70.
164 In Fontana Films, the parties arguing against validity had sought to distinguish[1] between a law which regulates or prohibits trading activities of a corporation (which was acknowledged to be a law with respect to the corporation) and a law which strikes at the activities of others because they interfere with the activities of such a corporation. They submitted that s 45D was of the latter character, and not a law with respect to corporations. Of this distinction, Mason J said[2]:
"When we speak of a law which regulates the trading activities of a trading corporation we mean a law which controls the subject matter by prohibiting the corporation from engaging in certain trading activities or permitting it so to do either absolutely or subject to condition. Such a law is within power because it necessarily operates directly on the subject of the power – it is a law about trading corporations. But when we speak of a law which protects the trading activities of a trading corporation our statement is not so specific. It may be understood as signifying a law which operates directly on the subject of the power. So understood the law is within power and valid. But it may be understood in a different sense so as to denote a law which, though it protects the trading activities of trading corporations, does so by a legal operation outside the subject matter of the power."
165 Because this was an important focus of argument, the reasons stated by the Court in Fontana Films are to be understood accordingly. In particular, the statements made by Gibbs CJ about laws relating to the trading and financial activities of trading and financial corporations being within power are to be understood as responding to the arguments advanced in that case. They are not to be read as attempting an exhaustive statement of the ambit of the power. Gibbs CJ explicitly denied[3] any intention of doing that. That said, it must be recognised that Gibbs CJ emphasised the importance of giving due weight to the words "foreign", "trading", and "financial" in considering the application of s 51(xx).
