FEDERAL AND STATE LEGISLATION IN REGARD TO COMPANIES. 485 



ipsissima verba) that it is entrusted with the regulation of 

 the conduct of existing corporations, whether State or 

 foreign, in their transactions with, or as affecting the public, 

 and even respecting the conditions under which the com- 

 pany may trade in the State which created it ; that though 

 the Commonwealth cannot create, it can entirely forbid a 

 foreign corporation doing business In Australia except on 

 such conditions as it proscribes — that it can, for instance, 

 proscribe conditions as to paid-up capital, as to securities 

 to be deposited, and as to the official reports and returns to 

 be made to Government; all of which functions have 

 hitherto come under what may be called the existing "police 

 provisions " of the current State Acts regarding companies. 

 The field of domestic trade, which was reserved to the 

 States, is in effect, claimed as having been transferred to 

 the Commonwealth. On the other hand it has been also 

 judicially contended that sovereign States alone can create 

 corporations; and it should follow accordingly that the 

 States hold the dominant position in regard to such legisla- 

 tion. Where the Federal authority invades the sphere of 

 State legislation, and steps outside the ambit of the Com- 

 monwealth powers— then, to quote a judicial allusion, 

 " although a dog can wag the tail, it by no means follows 

 that the tail can wag the dog." 



It will perhaps help in the consideration of this important 

 point if we consider what has been already decided by the 

 High Court. The full Court (in Huddarc Parker & Co. v. 

 Moorehead), held that Section 51 (20) "does not confer on 

 the Commonwealth Parliament power to create corpor- 

 ations, but the power is limited to legislation as to foreign 

 corporations and trading and financial corporations created 

 by State law." We may notice that such corporations do 

 not include all kinds of corporations; they include insurance 

 companies, but not manufacturing companies, mining com- 



