Strict licensing conditions apply for the operation of tourism enterprises in Arnhem Land in

the Northern Territory. In 2012, Antipodean Tours Ltd wanted to extend operations in this

area. To enhance its chances of gaining the necessary licenses, it incorporated a subsidiary

called Arnhem Land Antipodean Tours Pty Ltd with a 49% shareholding vested in people of

indigenous decent from Arnhem Land. It appointed three of the five directors to the board as

its nominees. The other two directors are local indigenous men with a good network and

relationship with the elders in the region, as well as experience in the tourism industry.

In November 2019, the restrictions on tourism are lifted and the licensing requirements for

operations in Arnhem Land falls away. Antipodean Tours Ltd no longer needs to work through

a subsidiary to operate in the area. Moreover, they no longer need the contacts of the two

indigenous directors appointed to the board of Arnhem Land Antipodean Tours Pty Ltd,

because they have built their own network in the past seven years.

With the full knowledge of its nominee directors, Antipodean Tours Ltd starts offering its own

tours to Arnhem Land in competition with the subsidiary. It also withdraws all systems and

marketing support to Arnhem Land Antipodean Tours Pty Ltd. When the two indigenous

directors want to institute action for breach of contract, the nominee directors refuse to take

any legal action against Antipodean Tours Ltd. It seems that the liquidation of Arnhem Land

Antipodean Tours Pty Ltd is imminent.

Consider whether the nominee directors breached any of their general or statutory law

duties. as per corporate governance.