the afr headline and article we need to see

The Great Chinese Iron Ore Swindle

Is it possible to acquire an Australian Iron Ore company without actually paying for it?

Such a statement would sound ludicrous, but for Australian iron ore player Brockman Resources this has now become a disturbing reality.

In what has exposed a veritable "black hole" in Australian corporate law, Wah Nam have successfully gained control of Brockman Resources by offering only scrip in their small limousine business who's largest asset is ......Brockman Resources itself.

By actually offering shareholders 30 Wah Nam shares for each Brockman share, Wah Nam have proved that it is actually possible to pay off your mortgage by issuing shares in your own house.

"How?" you may ask do you actually convince people that by diluting their shareholding in Brockman they are better off. You don't bother. You simply acquire shares on market via a complicated web of overseas company's and trading accounts then vote to support your own bid. And, it appears the Takeovers Panel is powerless to stop you as the onus of proof rests with the complainant.

In Brockman's case some of the accused were even arrogant enough to simply refuse to answer the Takeover's Panel's questions at all. Futhermore the fact that 99% of the bid acceptances emanated from overseas is apparently insufficient evidence for the Takeovers Panel to intervene.

Australian shareholders clearly do not want the Chinese to own Brockman Resources, yet that fact appears irrelevant.

Whilst Brockman now contemplates a long and protracted legal battle, the broader question remains :-

"For how long will the Federal Government and corporate regulators sit idle while foreign companies simply ignore our corporate laws and take control of our nation's assets?"