Corporate Law Economic Reform Program Act 1999 (Cth)

Corporate Law Economic Reform Program Act 1999

Act No. 156 of 1999 as amended

This compilation was prepared on 22 May 2003

[This Act was amended by Act No. 146 of 1999

(as amended by Act No. 63 of 2002)]

Amendments from Act No. 146 of 1999

(as amended by Act No. 63 of 2002)

[Schedule 1 (item 339) amended Schedule 5 (item 11)

Schedule 2 (item 22) of Act No. 63 of 2002 further amended

Schedule 1 (item 339)

The amendments commenced on 5 December 1999]

Prepared by the Office of Legislative Drafting,

Attorney‑General’s Department, Canberra

Contents

An Act to amend the Corporations Law and the Australian Securities and Investments Commission Act 1989, and for related purposes

[Assented to 24 November 1999]

The Parliament of Australia enacts:

1Short title

This Act may be cited as the Corporate Law Economic Reform Program Act 1999.

2Commencement

(1)
Sections 1 and 2 commence on the day on which this Act receives the Royal Assent.
(2)
The following provisions commence on a day or days to be fixed by Proclamation:
(a)
section 3;
(b)
the items in Schedules 1 to 7 (other than item 18 of Schedule 7);
(c)
the items in Schedules 10, 11 and 12.
(3)
If any of the following provisions does not commence under subsection (2) within the period of 6 months beginning on the day on which this Act receives the Royal Assent, it commences on the first day after the end of that period:
(a)
section 3;
(b)
an item in Schedules 1 to 7 (other than item 18 of Schedule 7);
(c)
an item in Schedule 10.
(4)
If an item in Schedule 11 or 12 does not commence under subsection (2) within the period of 12 months beginning on the day on which this Act receives the Royal Assent, it commences on the first day after the end of that period.
(5)
Item 18 of Schedule 7 is taken to have commenced on the day on which the Financial Sector Reform (Consequential Amendments) Act 1998 received the Royal Assent.
(6)
The items in Schedule 8 (other than item 3) are taken to have commenced immediately after the Managed Investments Act 1998.
(7)
Item 3 of Schedule 8 is taken to have commenced immediately after section 27 of the Corporate Law Reform Act 1992.
(8)
Item 1 of Schedule 9 is taken to have commenced on the day on which the Company Law Review Act 1998 received the Royal Assent.
(9)
Item 2 of Schedule 9 is taken to have commenced on the day on which the Managed Investments Act 1998 received the Royal Assent.

3Schedule(s)

(1)
Subject to section 2, the Corporations Law set out in section 82 of the Corporations Act 1989 is amended as set out in Schedules 1, 3, 6, 8 and 11 to this Act, and any other item in those Schedules has effect according to its terms.
(2)
Subject to section 2, each Act that is specified in another Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in the Schedule has effect according to its terms.

Schedule 1Main amendments of the Corporations Law

Chapters 2D and 2E

Repeal the Chapters, substitute:

Chapter 2D—Officers and employees

Part 2D.1—Duties and powers

179Background to duties of directors, other officers and employees

(1)
This Part sets out some of the most significant duties of directors, secretaries, other officers and employees of corporations. Other duties are imposed by other provisions of this Law and other laws (including the general law).
(2)
Section 9 defines both director and officer. Officer includes, as well as directors and secretaries, some other people who manage the corporation or its property (such as receivers and liquidators).

Division 1—General duties

180Care and diligence—civil obligation only

Care and diligence—directors and other officers
(1)
A director or other officer of a corporation must exercise their powers and discharge their duties with the degree of care and diligence that a reasonable person would exercise if they:
(a)
were a director or officer of a corporation in the corporation’s circumstances; and
(b)
occupied the office held by, and had the same responsibilities within the corporation as, the director or officer.
Note: This subsection is a civil penalty provision (see section 1317E).
Business judgment rule
(2)
A director or other officer of a corporation who makes a business judgment is taken to meet the requirements of subsection (1), and their equivalent duties at common law and in equity, in respect of the judgment if they:
(a)
make the judgment in good faith for a proper purpose; and
(b)
do not have a material personal interest in the subject matter of the judgment; and
(c)
inform themselves about the subject matter of the judgment to the extent they reasonably believe to be appropriate; and
(d)
rationally believe that the judgment is in the best interests of the corporation.
The director’s or officer’s belief that the judgment is in the best interests of the corporation is a rational one unless the belief is one that no reasonable person in their position would hold.
Note: This subsection only operates in relation to duties under this section and their equivalent duties at common law or in equity (including the duty of care that arises under the common law principles governing liability for negligence)—it does not operate in relation to duties under any other provision of this Law or under any other laws.
(3)
In this section:
business judgment means any decision to take or not take action in respect of a matter relevant to the business operations of the corporation.

181Good faith—civil obligations

Good faith—directors and other officers
(1)
A director or other officer of a corporation must exercise their powers and discharge their duties:
(a)
in good faith in the best interests of the corporation; and
(b)
for a proper purpose.
Note 1: This subsection is a civil penalty provision (see section 1317E).
Note 2: Section 187 deals with the situation of directors of wholly‑owned subsidiaries.
(2)
A person who is involved in a contravention of subsection (1) contravenes this subsection.
Note 1: Section 79 defines involved.
Note 2: This subsection is a civil penalty provision (see section 1317E).

182Use of position—civil obligations

Use of position—directors, other officers and employees
(1)
A director, secretary, other officer or employee of a corporation must not improperly use their position to:
(a)
gain an advantage for themselves or someone else; or
(b)
cause detriment to the corporation.
Note: This subsection is a civil penalty provision (see section 1317E).
(2)
A person who is involved in a contravention of subsection (1) contravenes this subsection.
Note 1: Section 79 defines involved.
Note 2: This subsection is a civil penalty provision (see section 1317E).

183Use of information—civil obligations

Use of information—directors, other officers and employees
(1)
A person who obtains information because they are, or have been, a director or other officer or employee of a corporation must not improperly use the information to:
(a)
gain an advantage for themselves or someone else; or
(b)
cause detriment to the corporation.
Note 1: This duty continues after the person stops being an officer or employee of the corporation.
Note 2: This subsection is a civil penalty provision (see section 1317E).
(2)
A person who is involved in a contravention of subsection (1) contravenes this subsection.
Note 1: Section 79 defines involved.
Note 2: This subsection is a civil penalty provision (see section 1317E).

184Good faith, use of position and use of information—criminal offences

Good faith—directors and other officers
(1)
A director or other officer of a corporation commits an offence if they:
(a)
are reckless; or
(b)
are intentionally dishonest;
and fail to exercise their powers and discharge their duties:
(c)
in good faith in the best interests of the corporation; or
(d)
for a proper purpose.
Note: Section 187 deals with the situation of directors of wholly-owned subsidiaries.
Use of position—directors, other officers and employees
(2)
A director, other officer or employee of a corporation commits an offence if they use their position dishonestly:
(a)
with the intention of directly or indirectly gaining an advantage for themselves, or someone else, or causing detriment to the corporation; or
(b)
recklessly as to whether the use may result in themselves or someone else directly or indirectly gaining an advantage, or in causing detriment to the corporation.
Use of information—directors, other officers and employees
(3)
A person who obtains information because they are, or have been, a director or other officer or employee of a corporation commits an offence if they use the information dishonestly:
(a)
with the intention of directly or indirectly gaining an advantage for themselves, or someone else, or causing detriment to the corporation; or
(b)
recklessly as to whether the use may result in themselves or someone else directly or indirectly gaining an advantage, or in causing detriment to the corporation.

185Interaction of sections 180 to 184 with other laws etc.

Sections 180 to 184:
(a)
have effect in addition to, and not in derogation of, any rule of law relating to the duty or liability of a person because of their office or employment in relation to a corporation; and
(b)
do not prevent the commencement of civil proceedings for a breach of a duty or in respect of a liability referred to in paragraph (a).
This section does not apply to subsections 180(2) and (3) to the extent to which they operate on the duties at common law and in equity that are equivalent to the requirements of subsection 180(1).

186Territorial application of sections 180 to 184

Sections 180 to 184 do not apply to an act or omission by a director or other officer or employee of a foreign company unless the act or omission occurred in connection with:
(a)
the foreign company carrying on business in Australia; or
(b)
an act that the foreign company does, or proposes to do, in Australia; or
(c)
a decision by the foreign company whether or not to do, or refrain from doing, an act in Australia.

187Directors of wholly‑owned subsidiaries

A director of a corporation that is a wholly‑owned subsidiary of a body corporate is to be taken to act in good faith in the best interests of the subsidiary if:
(a)
the constitution of the subsidiary expressly authorises the director to act in the best interests of the holding company; and
(b)
the director acts in good faith in the best interests of the holding company; and
(c)
the subsidiary is not insolvent at the time the director acts and does not become insolvent because of the director’s act.

188Responsibility of secretaries and directors for certain contraventions

Secretary’s functions
(1)
A secretary of a company contravenes this subsection if the company contravenes:
(a)
section 142 (requirement for companies to have registered office); or
(b)
section 145 (requirement for registered office of public company to be open to public); or
(c)
section 345 (annual returns); or
(d)
section 205B (lodgment of notices with ASIC).
Note: See section 203C for the circumstances in which a company must have a secretary.
Consequence if director of proprietary company without secretary does not fulfil secretary’s function
(2)
Each director of a proprietary company contravenes this subsection if:
(a)
the proprietary company contravenes section 142, 145, 205B or 345; and
(b)
the proprietary company does not have a secretary when it contravenes that section.
Defence
(3)
A person does not contravene subsection (1) or (2) if they show that they took all reasonable steps to ensure that the company complied with the section.

189Reliance on information or advice provided by others

If:
(a)
a director relies on information, or professional or expert advice, given or prepared by:
(i)
an employee of the corporation whom the director believes on reasonable grounds to be reliable and competent in relation to the matters concerned; or
(ii)
a professional adviser or expert in relation to matters that the director believes on reasonable grounds to be within the person’s professional or expert competence; or
(iii)
another director or officer in relation to matters within the director’s or officer’s authority; or
(iv)
a committee of directors on which the director did not serve in relation to matters within the committee’s authority; and
(b)
the reliance was made:
(i)
in good faith; and
(ii)
after making an independent assessment of the information or advice, having regard to the director’s knowledge of the corporation and the complexity of the structure and operations of the corporation; and
(c)
the reasonableness of the director’s reliance on the information or advice arises in proceedings brought to determine whether a director has performed a duty under this Part or an equivalent general law duty;
the director’s reliance on the information or advice is taken to be reasonable unless the contrary is proved.

190Responsibility for actions of delegate

(1)
If the directors delegate a power under section 198D, a director is responsible for the exercise of the power by the delegate as if the power had been exercised by the directors themselves.
(2)
A director is not responsible under subsection (1) if:
(a)
the director believed on reasonable grounds at all times that the delegate would exercise the power in conformity with the duties imposed on directors of the company by this Law and the company’s constitution (if any); and
(b)
the director believed:
(i)
on reasonable grounds; and
(ii)
in good faith; and
(iii)
after making proper inquiry if the circumstances indicated the need for inquiry;
that the delegate was reliable and competent in relation to the power delegated.

Division 2—Disclosure of, and voting on matters involving, material personal interests

191Material personal interest—director’s duty to disclose

Director’s duty to notify other directors of material personal interest when conflict arises
(1)
A director of a company who has a material personal interest in a matter that relates to the affairs of the company must give the other directors notice of the interest unless subsection (2) says otherwise.
(2)
The director does not need to give notice of an interest under subsection (1) if:
(a)
the interest:
(i)
arises because the director is a member of the company and is held in common with the other members of the company; or
(ii)
arises in relation to the director’s remuneration as a director of the company; or
(iii)
relates to a contract the company is proposing to enter into that is subject to approval by the members and will not impose any obligation on the company if it is not approved by the members; or
(iv)
arises merely because the director is a guarantor or has given an indemnity or security for all or part of a loan (or proposed loan) to the company; or
(v)
arises merely because the director has a right of subrogation in relation to a guarantee or indemnity referred to in subparagraph (iv); or
(vi)
relates to a contract that insures, or would insure, the director against liabilities the director incurs as an officer of the company (but only if the contract does not make the company or a related body corporate the insurer); or
(vii)
relates to any payment by the company or a related body corporate in respect of an indemnity permitted under section 199A or any contract relating to such an indemnity; or
(viii)
is in a contract, or proposed contract, with, or for the benefit of, or on behalf of, a related body corporate and arises merely because the director is a director of the related body corporate; or
(b)
the company is a proprietary company and the other directors are aware of the nature and extent of the interest and its relation to the affairs of the company; or
(c)
all the following conditions are satisfied:
(i)
the director has already given notice of the nature and extent of the interest and its relation to the affairs of the company under subsection (1)
(ii)
if a person who was not a director of the company at the time when the notice under subsection (1) was given is appointed as a director of the company—the notice is given to that person
(iii)
the nature or extent of the interest has not materially increased above that disclosed in the notice; or
(d)
the director has given a standing notice of the nature and extent of the interest under section 192 and the notice is still effective in relation to the interest.
Note: Subparagraph (c)(ii)—the notice may be given to the person referred to in this subparagraph by someone other than the director to whose interests it relates (for example, by the secretary).
(3)
The notice required by subsection (1) must:
(a)
give details of:
(i)
the nature and extent of the interest; and
(ii)
the relation of the interest to the affairs of the company; and
(b)
be given at a directors’ meeting as soon as practicable after the director becomes aware of their interest in the matter.
The details must be recorded in the minutes of the meeting.
Effect of contravention by director
(4)
A contravention of this section by a director does not affect the validity of any act, transaction, agreement, instrument, resolution or other thing.
Section does not apply to single director proprietary company
(5)
This section does not apply to a proprietary company that has only 1 director.

192Director may give other directors standing notice about an interest

Power to give notice
(1)
A director of a company who has an interest in a matter may give the other directors standing notice of the nature and extent of the interest in the matter in accordance with subsection (2). The notice may be given at any time and whether or not the matter relates to the affairs of the company at the time the notice is given.
Note: The standing notice may be given to the other directors before the interest becomes a material personal interest.
(2)
The notice under subsection (1) must:
(a)
give details of the nature and extent of the interest; and
(b)
be given:
(i)
at a directors’ meeting (either orally or in writing); or
(ii)
to the other directors individually in writing.
The standing notice is given under subparagraph (b)(ii) when it has been given to every director.
Standing notice must be tabled at meeting if given to directors individually
(3)
If the standing notice is given to the other directors individually in writing, it must be tabled at the next directors’ meeting after it is given.
Nature and extent of interest must be recorded in minutes
(4)
The director must ensure that the nature and extent of the interest disclosed in the standing notice is recorded in the minutes of the meeting at which the standing notice is given or tabled.
Dates of effect and expiry of standing notice
(5)
The standing notice:
(a)
takes effect as soon as it is given; and
(b)
ceases to have effect if a person who was not a director of the company at the time when the notice was given is appointed as a director of the company.
A standing notice that ceases to have effect under paragraph (b) commences to have effect again if it is given to the person referred to in that paragraph.
Note: The notice may be given to the person referred to in paragraph (b) by someone other than the director to whose interests it relates (for example, by the secretary).
Effect of material increase in nature or extent of interest
(6)
The standing notice ceases to have effect in relation to a particular interest if the nature or extent of the interest materially increases above that disclosed in the notice.
Effect of contravention by director
(7)
A contravention of this section by a director does not affect the validity of any act, transaction, agreement, instrument, resolution or other thing.

193Interaction of sections 191 and 192 with other laws etc.

Sections 191 and 192 have effect in addition to, and not in derogation of:
(a)
any general law rule about conflicts of interest; and
(b)
any provision in a company’s constitution (if any) that restricts a director from:
(i)
having a material personal interest in a matter; or
(ii)
holding an office or possessing property;
involving duties or interests that conflict with their duties or interests as a director.

194Voting and completion of transactions—directors of proprietary companies (replaceable rule—see section 135)

If a director of a proprietary company has a material personal interest in a matter that relates to the affairs of the company and:

(a)
under section 191 the director discloses the nature and extent of the interest and its relation to the affairs of the company at a meeting of the directors; or
(b)
the interest is one that does not need to be disclosed under section 191;
then:
(c)
the director may vote on matters that relate to the interest; and
(d)
any transactions that relate to the interest may proceed; and
(e)
the director may retain benefits under the transaction even though the director has the interest; and
(f)
the company cannot avoid the transaction merely because of the existence of the interest.
If disclosure is required under section 191, paragraphs (e) and (f) apply only if the disclosure is made before the transaction is entered into.
Note: A director may need to give notice to the other directors if the director has a material personal interest in a matter relating to the affairs of the company (see section 191).

195Restrictions on voting—directors of public companies only

Restrictions on voting and being present
(1)
A director of a public company who has a material personal interest in a matter that is being considered at a directors’ meeting must not:
(a)
be present while the matter is being considered at the meeting; or
(b)
vote on the matter;
unless:
(c)
subsection (2) or (3) allows the director to be present; or
(d)
the interest does not need to be disclosed under section 191.
Participation with approval of other directors
(2)
The director may be present and vote if directors who do not have a material personal interest in the matter have passed a resolution that:
(a)
identifies the director, the nature and extent of the director’s interest in the matter and its relation to the affairs of the company; and
(b)
states that those directors are satisfied that the interest should not disqualify the director from voting or being present.
Participation with ASIC approval
(3)
The director may be present and vote if they are so entitled under a declaration or order made by ASIC under section 196.
Director may consider or vote on resolution to deal with matter at general meeting
(4)
If there are not enough directors to form a quorum for a directors’ meeting because of subsection (1), 1 or more of the directors (including those who have a material personal interest in that matter) may call a general meeting and the general meeting may pass a resolution to deal with the matter.
Effect of contravention by director
(5)
A contravention by a director of:
(a)
this section; or
(b)
a condition attached to a declaration or order made by ASIC under section 196;
does not affect the validity of any resolution.

196ASIC power to make declarations and class orders

ASIC’s power to make specific declarations
(1)
ASIC may declare in writing that a director of a public company who has a material personal interest in a matter that is being, or is to be, considered at a directors’ meeting may, despite the director’s interest, be present while the matter is being considered at the meeting, vote on the matter, or both be present and vote. However, ASIC may only make the declaration if:
(a)
the number of directors entitled to be present and vote on the matter would be less than the quorum for a directors’ meeting if the director were not allowed to vote on the matter at the meeting; and
(b)
the matter needs to be dealt with urgently, or there is some other compelling reason for the matter being dealt with at the directors’ meeting, rather than by a general meeting called under subsection 195(4).
(2)
The declaration may:
(a)
apply to all or only some of the directors; or
(b)
specify conditions that the company or director must comply with.
ASIC’s power to make class orders
(3)
ASIC may make an order in writing that enables directors who have a material personal interest in a matter to be present while the matter is being considered at a directors’ meeting, vote on that matter, or both be present and vote. The order may be made in respect of a specified class of public companies, directors, resolutions or interests.
(4)
The order may be expressed to be subject to conditions.
(5)
Notice of the making, revocation or suspension of the order must be published in the Gazette.

Division 3—Duty to discharge certain trust liabilities

197Directors liable for debts and other obligations incurred by corporation as trustee

(1)
A person who is a director of a corporation when it incurs a liability while acting, or purporting to act, as trustee, is liable to discharge the whole or a part of the liability if the corporation:
(a)
has not, and cannot, discharge the liability or that part of it; and
(b)
is not entitled to be fully indemnified against the liability out of trust assets.
This is so even if the trust does not have enough assets to indemnify the trustee. The person is liable both individually and jointly with the corporation and anyone else who is liable under this subsection.
(2)
The person is not liable under subsection (1) if the person would be entitled to have been fully indemnified by 1 of the other directors against the liability had all the directors of the corporation been trustees when the liability was incurred.
(3)
This section does not apply to a liability incurred outside Australia by a foreign company.

Division 4—Powers

198APowers of directors (replaceable rule—see section 135)

(1)
The business of a company is to be managed by or under the direction of the directors.
Note: See section 198E for special rules about the powers of directors who are the single director/shareholder of proprietary companies.
(2)
The directors may exercise all the powers of the company except any powers that this Law or the company’s constitution (if any) requires the company to exercise in general meeting.
Note: For example, the directors may issue shares, borrow money and issue debentures.

198BNegotiable instruments (replaceable rule—see section 135)

(1)
Any 2 directors of a company that has 2 or more directors, or the director of a proprietary company that has only 1 director, may sign, draw, accept, endorse or otherwise execute a negotiable instrument.
(2)
The directors may determine that a negotiable instrument may be signed, drawn, accepted, endorsed or otherwise executed in a different way.

198CManaging director (replaceable rule—see section 135)

(1)
The directors of a company may confer on a managing director any of the powers that the directors can exercise.
(2)
The directors may revoke or vary a conferral of powers on the managing director.

198DDelegation

(1)
Unless the company’s constitution provides otherwise, the directors of a company may delegate any of their powers to:
(a)
a committee of directors; or
(b)
a director; or
(c)
an employee of the company; or
(d)
any other person.
Note: The delegation must be recorded in the company’s minute book (see section 251A).
(2)
The delegate must exercise the powers delegated in accordance with any directions of the directors.
(3)
The exercise of the power by the delegate is as effective as if the directors had exercised it.

198ESingle director/shareholder proprietary companies

Powers of director
(1)
The director of a proprietary company who is its only director and only shareholder may exercise all the powers of the company except any powers that this Law or the company’s constitution (if any) requires the company to exercise in general meeting. The business of the company is to be managed by or under the direction of the director.
Note: For example, the director may issue shares, borrow money and issue debentures.
Negotiable instruments
(2)
The director of a proprietary company who is its only director and only shareholder may sign, draw, accept, endorse or otherwise execute a negotiable instrument. The director may determine that a negotiable instrument may be signed, drawn, accepted, endorsed or otherwise executed in a different way.

198FRight of access to company books

Right while director
(1)
A director of a company may inspect the books of the company (other than its financial records) at all reasonable times for the purposes of a legal proceeding:
(a)
to which the person is a party; or
(b)
that the person proposes in good faith to bring; or
(c)
that the person has reason to believe will be brought against them.
Note: Section 290 gives the director a right of access to financial records.
Right during 7 years after ceasing to be director
(2)
A person who has ceased to be a director of a company may inspect the books of the company (including its financial records) at all reasonable times for the purposes of a legal proceeding:
(a)
to which the person is a party; or
(b)
that the person proposes in good faith to bring; or
(c)
that the person has reason to believe will be brought against them.
This right continues for 7 years after the person ceased to be a director of the company.
Right to take copies
(3)
A person authorised to inspect books under this section for the purposes of a legal proceeding may make copies of the books for the purposes of those proceedings.
Company not to refuse access
(4)
A company must allow a person to exercise their rights to inspect or take copies of the books under this section.
Interaction with other rules
(5)
This section does not limit any right of access to company books that a person has apart from this section.

Part 2D.2—Restrictions on indemnities, insurance and termination payments

Division 1—Indemnities and insurance for officers and auditors

199AIndemnification and exemption of officer or auditor

Exemptions not allowed
(1)
A company or a related body corporate must not exempt a person (whether directly or through an interposed entity) from a liability to the company incurred as an officer or auditor of the company.
When indemnity for liability (other than for legal costs) not allowed
(2)
A company or a related body corporate must not indemnify a person (whether by agreement or by making a payment and whether directly or through an interposed entity) against any of the following liabilities incurred as an officer or auditor of the company:
(a)
a liability owed to the company or a related body corporate
(b)
a liability for a pecuniary penalty order under section 1317G or a compensation order under section 1317H
(c)
a liability that is owed to someone other than the company or a related body corporate and did not arise out of conduct in good faith.
This subsection does not apply to a liability for legal costs.
When indemnity for legal costs not allowed
(3)
A company or related body corporate must not indemnify a person (whether by agreement or by making a payment and whether directly or through an interposed entity) against legal costs incurred in defending an action for a liability incurred as an officer or auditor of the company if the costs are incurred:
(a)
in defending or resisting proceedings in which the person is found to have a liability for which they could not be indemnified under subsection (2); or
(b)
in defending or resisting criminal proceedings in which the person is found guilty; or
(c)
in defending or resisting proceedings brought by ASIC or a liquidator for a court order if the grounds for making the order are found by the court to have been established; or
(d)
in connection with proceedings for relief to the person under this Law in which the Court denies the relief.
Paragraph (c) does not apply to costs incurred in responding to actions taken by ASIC or a liquidator as part of an investigation before commencing proceedings for the court order.
Note 1: Paragraph (c)—This includes proceedings by ASIC for an order under section 206C, 206D or 206E (disqualification), section 232 (oppression), section 1317E, 1317G or 1317H (civil penalties) or section 1324 (injunction).
Note 2: The company may be able to give the person a loan or advance in respect of the legal costs (see section 212).
(4)
For the purposes of subsection (3), the outcome of proceedings is the outcome of the proceedings and any appeal in relation to the proceedings.

199BInsurance premiums for certain liabilities of director, secretary, other officer or auditor

A company or a related body corporate must not pay, or agree to pay, a premium for a contract insuring a person who is or has been an officer or auditor of the company against a liability (other than one for legal costs) arising out of:
(a)
conduct involving a wilful breach of duty in relation to the company; or
(b)
a contravention of section 182 or 183.
This section applies to a premium whether it is paid directly or through an interposed entity.

199CCertain indemnities, exemptions, payments and agreements not authorised and certain documents void

(1)
Sections 199A and 199B do not authorise anything that would otherwise be unlawful.
(2)
Anything that purports to indemnify or insure a person against a liability, or exempt them from a liability, is void to the extent that it contravenes section 199A or 199B.

Division 2—Termination payments

200AWhen benefit given in connection with retirement from office

(1)
For the purposes of this Division:
(a)
a benefit is given in connection with a person’s retirement from an office if the benefit is given:
(i)
by way of compensation for, or otherwise in connection with, the loss by the person of the office; or
(ii)
in connection with the person’s retirement from the office; and
(b)
giving a benefit includes:
(i)
if the benefit is a payment—making the payment; and
(ii)
if the benefit is an interest in property—transferring the interest; and
(c)
a person gives a benefit even if the person is obliged to give the benefit under a contract; and
(d)
a pension or lump sum is paid or payable in connection with the person’s retirement from an office if the pension or lump sum is paid or payable:
(i)
by way of compensation for, or otherwise in connection with, the loss by the person of the office; or
(ii)
in connection with the person’s retirement from the office; and
(e)
retirement from an office includes:
(i)
loss of the office; and
(ii)
resignation from the office; and
(iii)
death of a person at a time when they hold the office.
(2)
For the purposes of this Division, if:
(a)
a person (person A) gives another person a benefit (benefit A); and
(b)
person A gives benefit A for the purpose, or for purposes including the purpose, of enabling or assisting someone to give a person a benefit in connection with the retirement of a person (person B) from an office;
person A is taken to give benefit A in connection with the person B’s retirement from that office.

200BRetirement benefits generally need membership approval

Benefits in connection with retirement from board or managerial office
(1)
The following must not give a person a benefit in connection with that person’s, or someone else’s, retirement from a board or managerial office in a company, or a related body corporate, without member approval under section 200E:
(a)
the company
(b)
an associate of the company (other than a body corporate that is related to the company and is itself a company)
(c)
a prescribed superannuation fund in relation to the company.
Note 1: Sections 200F, 200G and 200H provide for exceptions to this rule.
Note 2: Section 9 defines board or managerial office.
Prescribed superannuation funds
(2)
For the purposes of this section:
(a)
a superannuation fund is taken to be a prescribed superannuation fund in relation to a company if the company, or an associate of the company, gives a benefit to the superannuation fund in prescribed circumstances; and
(b)
if a prescribed superannuation fund in relation to a company gives a benefit to another superannuation fund in prescribed circumstances, the other superannuation fund is taken to be a prescribed superannuation fund in relation to the company.
Prescribed circumstances
(3)
For the purposes of this section, if:
(a)
a company, or an associate of a company, gives a benefit to a superannuation fund solely for the purpose of enabling or assisting the superannuation fund to give to a person a benefit in connection with a person’s retirement from an office in the company or a related body corporate; or
(b)
a superannuation fund gives a benefit to another superannuation fund solely for the purpose of enabling or assisting the other superannuation fund to give to a person a benefit in connection with a person’s retirement from an office in a company or a related body corporate;
the benefit first referred to in paragraph (a) or (b) is taken to be given in prescribed circumstances.
(4)
In this section:
superannuation fund means a provident, benefit, superannuation or retirement fund.

200CBenefits on transfer of undertaking or property need membership approval

A person must not give a benefit to a person who:
(a)
holds, or has at any previous time held, a board or managerial office in a company or a related body corporate; or
(b)
is the spouse of a person referred to in paragraph (a); or
(c)
is a relative of a person referred to in paragraph (a) or of the spouse of such a person; or
(d)
is an associate of a person referred to in paragraph (a) or the spouse of an associate of such a person;
in connection with the transfer of the whole or any part of the undertaking or property of the company without member approval under section 200E.
Note: Section 9 defines board or managerial office.

200DContravention to receive benefit without member approval

A person who:
(a)
holds, or has at any previous time held, a board or managerial office in a company or related body corporate; or
(b)
is the spouse of a person referred to in paragraph (a); or
(c)
is a relative of a person referred to in paragraph (a) or of the spouse of such a person; or
(d)
is an associate of a person referred to in paragraph (a) or the spouse of an associate of such a person;
must not receive a benefit if the giving of the benefit contravenes section 200B or 200C.
Note: Section 9 defines board or managerial office.

200EApproval by members

(1)
If section 200B or 200C requires member approval for giving a person a benefit, it must be approved by a resolution passed at a general meeting of:
(a)
the company; and
(b)
if the company is a subsidiary of a listed domestic corporation—the listed corporation; and
(c)
if the company has a holding company that:
(i)
is a domestic corporation that is not listed; and
(ii)
is not itself a subsidiary of a domestic corporation—the holding company.
(2)
Details of the benefit must be set out in, or accompany, the notice of the meeting at which the resolution is to be considered. The details must include:
(a)
if the proposed benefit is a payment:
(i)
the amount of the payment; or
(ii)
if that amount cannot be ascertained at the time of the disclosure—the manner in which that amount is to be calculated and any matter, event or circumstance that will, or is likely to, affect the calculation of that amount; and
(b)
otherwise:
(i)
the money value of the proposed prescribed benefit; or
(ii)
if that value cannot be ascertained at the time of the disclosure—the manner in which that value is to be calculated and any matter, event or circumstance that will, or is likely to, affect the calculation of that value.
These requirements are in addition to, and not in derogation of, any other law that requires disclosure to be made with respect to giving or receiving a benefit.
(3)
The approval extends to the giving of another benefit to the person if:
(a)
the other benefit is given to the person instead of the proposed benefit; and
(b)
the amount or money value of the benefit is less than the amount or money value of the proposed benefit.
(4)
The approval does not relieve a director of a body corporate from any duty to the body corporate (whether under section 180,181,182,183 or 184 or otherwise and whether of a fiduciary nature or not) in connection with the giving of the benefit.

200FExempt benefits and benefits given in certain circumstances

Subsection 200B(1) does not apply to:
(a)
a benefit given in connection with a person’s retirement from an office in relation to a company if the benefit is:
(i)
given under an agreement entered into before 1 January 1991 if giving the benefit in accordance with the agreement would have been lawful if the benefit were given when the agreement was entered into; or
(ii)
a genuine payment by way of damages for breach of contract; or

(iii)
given to the person under an agreement made between the company and the person before the person became the holder of the office as the consideration, or part of the consideration, for the person agreeing to hold the office; or
(iv)
a payment made in respect of leave of absence to which the person is entitled under an industrial instrument; or
(b)
a benefit given in prescribed circumstances.

200GGenuine payments of pension and lump sum

(1)
Subsection 200B(1) does not apply to a benefit if:
(a)
the benefit is a payment in connection with a person’s retirement from a board or managerial office (the relevant office) in a company or a related body corporate; and
(b)
the payment is for past services the person rendered to:
(i)
the company; or
(ii)
a related body corporate; or
(iii)
a body that was a related body corporate of the company when the past services were rendered; and
(c)
the value of the benefit, when added to the value of all other payments (if any) already made or payable in connection with the person’s retirement from board or managerial offices in the company and related bodies corporate does not exceed the payment limit set by subsection (1A).
In applying paragraph (c), disregard any pensions or lump sums that section 200F applies to.
(2)
The payment limit is:
(a)
the amount worked out under subsection (3) if the person:
(i)
was an eligible employee in relation to the company at the time when the person retired from the relevant office; and
(ii)
has been an eligible employee in relation to the company throughout a period (the relevant period), or throughout periods totalling a period (also the relevant period), of more than 3 years; or
(b)
otherwise—the total remuneration of the person from the company and related bodies corporate during the period of 3 years ending when the person retired from the relevant office.
Note: Section 9 defines remuneration.
(3)
The amount worked out under this subsection is the amount worked out using the formula:
where:
total remuneration is the amount of the total remuneration of the person from the company and related bodies corporate during the last 3 years of the relevant period.
relevant period is the number of years in the relevant period or 7, whichever is the lesser number.
(4)
In determining for the purposes of paragraph (1)(c) the value of a pension or lump sum payment, disregard any part of the pension or lump sum payment that is attributable to:
(a)
a contribution made by the person; or
(b)
a contribution made by a person other than:
(i)
the company; or
(ii)
a body corporate (a relevant body corporate) that is a related body corporate of the company, or that was, when the contribution was made, such a related body corporate; or
(iii)
an associate of the company, or of a relevant body corporate, in respect of:
(A)
the payment of the pension, or the making of the lump sum payment, as the case may be; or
(B)
the making of the contribution.
(5)
For the purposes of subparagraph (2)(a), a person is taken to have been an eligible employee in relation to a company at a particular time if:
(a)
the person was a genuine full‑time employee of the company at that time; or
(b)
the person was a genuine full‑time employee of a body corporate at that time and the body corporate was related to the company at that time.
(6)
In this section:
payment means a payment by way of pension or lump sum and includes a superannuation, retiring allowance, superannuation gratuity or similar payment.

200HBenefits required by law

Subsection 200B(1) does not apply to a benefit given by a person if failure to give the benefit would constitute a contravention of a law in force in Australia or elsewhere (otherwise than because of breach of contract or breach of trust).

200JBenefits to be held in trust for company

(1)
If giving a benefit to a person contravenes section 200B, then:
(a)
if the benefit is a payment—the amount of the payment; or
(b)
otherwise—the money value of the prescribed benefit;
is taken to be received by the person in trust for the company concerned.
(2)
Subsection (1) applies to the whole of the amount of a payment or of the money value of the benefit even though giving the benefit would not have contravened section 200B if that amount or value of the benefit had been less.

Part 2D.3—Appointment, remuneration and cessation of appointment of directors

Division 1—Appointment of directors

201AMinimum number of directors

Proprietary companies
(1)
A proprietary company must have at least 1 director. That director must ordinarily reside in Australia.
Public companies
(2)
A public company must have at least 3 directors (not counting alternate directors). At least 2 directors must ordinarily reside in Australia.

201BWho can be a director

(1)
Only an individual who is at least 18 may be appointed as a director of a company.
(2)
A person who is disqualified from managing corporations under Part 2D.6 may only be appointed as director of a company if the appointment is made with permission granted by ASIC under section 206F or leave granted by the Court under section 206G.

201CDirectors of public companies, or subsidiaries, over 72

(1)
A person who has turned 72 may only be appointed or act as a director of:
(a)
a public company; or
(b)
a company that is a subsidiary of a public company;
if authorised to do so under this section.
(2)
A person may act as a director of a company during the period that:
(a)
starts on the day on which they turn 72; and
(b)
ends at the conclusion of the AGM beginning next after that day.
(3)
The office of a director of a public company, or of a subsidiary of a public company, becomes vacant at the conclusion of the AGM of the public company, or the subsidiary, beginning next after the director turns 72.
(4)
If a proprietary company is a subsidiary of a public company:
(a)
subsection (3) does not apply to it; and
(b)
a person may continue to act as a director of the proprietary company until the next AGM of the public company after the person turns 72; and
(c)
the person’s office of director becomes vacant at the end of that meeting.
Note: Proprietary companies do not need to hold annual general meetings (see section 250N).
(5)
An act done by a person as a director is valid even if it is afterwards discovered that they had turned 72 at the time when they were appointed or that their appointment had terminated under subsection (3) or (4).
(6)
If the office of a director has become vacant under subsection (3) or (4), no provision for the automatic re‑appointment of retiring directors in default of another appointment applies in relation to that director.
(7)
If a vacancy created under subsection (3) or (4) is not filled at the meeting at which the office became vacant, the office may be filled as a casual vacancy.
(8)
Subject to subsections (9) and (10), a person who has turned 72 may by special resolution be appointed or re‑appointed as a director of that company to hold office until the conclusion of the company’s next AGM company if:
(a)
the resolution states the person’s age; and
(b)
the notice of meeting states that the person is a candidate for election who has turned 72 and states the person’s age.
(9)
If the company is a subsidiary of a public company, the appointment or re‑appointment referred to in subsection (8) does not have effect unless:
(a)
the person appointed or re‑appointed is a director of the public company; or
(b)
the appointment or re‑appointment of the person as a director of the company has been approved by a special resolution of the public company and the notice of meeting states that the person is a candidate for election as a director of the company who has turned 72 and states the person’s age.
(10)
If the subsidiary is a proprietary company:
(a)
the person may be appointed or re‑appointed as a director of the subsidiary until the end of the next AGM of the holding company; and
(b)
the appointment does not need a resolution under subsection (8); and
(c)
the appointment must satisfy either paragraph (9)(a) or (b).
(11)
If:
(a)
the constitution of a company limited by guarantee provides for the holding of postal ballots for the election of a director or directors; and
(b)
a postal ballot for the election of a director or directors is held and in the ballot:
(i)
the members entitled to vote have been given notice in writing by the company stating that a candidate for election has turned 72 and stating the age of the candidate; and
(ii)
that candidate is elected by a majority of not less than 75% of the members who, being entitled to vote, vote in the ballot;
that candidate may be appointed or re‑appointed as a director to hold office until the conclusion of the next AGM of the company.
(12)
If:
(a)
the constitution of a company limited by guarantee provides for the election or appointment of a director or directors otherwise than by members at a general meeting or by postal ballot of members; and
(b)
ASIC declares in writing that this section does not apply to the company or its directors;
then, subject to the conditions (if any) that ASIC specifies in the declaration, this section does not so apply.
(13)
A vacancy in the office of a director occurring under subsection (3) or (4) is not to be taken into account in determining when other directors are to retire.
(14)
Nothing in this section limits, or affects the operation of, any provision of a company’s constitution that prevents any person from being appointed as a director or requiring any director to vacate their office at any age less than 72 years.

201DConsent to act as director

(1)
A company contravenes this subsection if a person does not give the company a signed consent to act as a director of the company before being appointed.
(2)
The company must keep the consent.

201ESpecial rules for the appointment of public company directors

(1)
A resolution passed at a general meeting of a public company appointing or confirming the appointment of 2 or more directors is void unless:
(a)
the meeting has resolved that the appointments or confirmations may be voted on together; and
(b)
no votes were cast against the resolution.
(2)
This section does not affect:
(a)
a resolution to appoint directors by an amendment to the company’s constitution (if any); or
(b)
a ballot or poll to elect 2 or more directors if the ballot or poll does not require members voting for 1 candidate to vote for another candidate.
(3)
For the purposes of paragraph (2)(b), a ballot or poll does not require a member to vote for a candidate merely because the member is required to express a preference among individual candidates in order to cast a valid vote.

201FSpecial rules for the appointment of directors for single director/single shareholder proprietary companies

(1)
The director of a proprietary company who is its only director and only shareholder may appoint another director by recording the appointment and signing the record.
Appointment of new director on death, mental incapacity or bankruptcy
(2)
If a person who is the only director and the only shareholder of a proprietary company:
(a)
dies; or
(b)
cannot manage the company because of the person’s mental incapacity;
and a personal representative or trustee is appointed to administer the person’s estate or property, the personal representative or trustee may appoint a person as the director of the company.
(3)
If:
(a)
the office of the director of a proprietary company is vacated under subsection 206B(3) or (4) because of the bankruptcy of the director; and
(b)
the person is the only director and the only shareholder of the company; and
(c)
a trustee in bankruptcy is appointed to the person’s property;
the trustee may appoint a person as the director of the company.
(4)
A person who has a power of appointment under subsection (2) or (3) may appoint themselves as director.
(5)
A person appointed as a director of a company under subsection (2), (3) or (4) holds office as if they had been appointed in the usual way.

201GCompany may appoint a director (replaceable rule—see section 135)

A company may appoint a person as a director by resolution passed in general meeting.

201HDirectors may appoint other directors (replaceable rule—see section 135)

Appointment by other directors
(1)
The directors of a company may appoint a person as a director. A person can be appointed as a director in order to make up a quorum for a directors’ meeting even if the total number of directors of the company is not enough to make up that quorum.
Proprietary company—confirmation by meeting within 2 months
(2)
If a person is appointed under this section as a director of a proprietary company, the company must confirm the appointment by resolution within 2 months after the appointment is made. If the appointment is not confirmed, the person ceases to be a director of the company at the end of those 2 months.
Public company—confirmation by next AGM
(3)
If a person is appointed by the other directors as a director of a public company, the company must confirm the appointment by resolution at the company’s next AGM. If the appointment is not confirmed, the person ceases to be a director of the company at the end of the AGM.

201JAppointment of managing directors (replaceable rule—see section 135)

The directors of a company may appoint 1 or more of themselves to the office of managing director of the company for the period, and on the terms (including as to remuneration), as the directors see fit.

201KAlternate directors (replaceable rule—see section 135)

(1)
With the other directors’ approval, a director may appoint an alternate to exercise some or all of the director’s powers for a specified period.
(2)
If the appointing director requests the company to give the alternate notice of directors’ meetings, the company must do so.
(3)
When an alternate exercises the director’s powers, the exercise of the powers is just as effective as if the powers were exercised by the director.
(4)
The appointing director may terminate the alternate’s appointment at any time.
(5)
An appointment or its termination must be in writing. A copy must be given to the company.
Note: ASIC must be given notice of the appointment and termination of appointment of an alternate (see subsections 205B(2) and (5)).

201LSignpost—ASIC to be notified of appointment

Under section 205B, a company must notify ASIC within 14 days if a person is appointed as a director or as an alternate director.

201MEffectiveness of acts by directors

(1)
An act done by a director is effective even if their appointment, or the continuance of their appointment, is invalid because the company or director did not comply with the company’s constitution (if any) or any provision of this Law.
(2)
Subsection (1) does not deal with the question whether an effective act by a director:
(a)
binds the company in its dealings with other people; or
(b)
makes the company liable to another person.
Note: The kinds of acts that this section validates are those that are only legally effective if the person doing them is a director (for example, calling a meeting of the company’s members or signing a document to be lodged with ASIC or minutes of a meeting). Sections 128‑130 contain rules about the assumptions people are entitled to make when dealing with a company and its officers.

Division 2—Remuneration of directors

202ARemuneration of directors (replaceable rule—see section 135)

(1)
The directors of a company are to be paid the remuneration that the company determines by resolution.
Note: Chapter 2E makes special provision for the payment of remuneration to the directors of public companies.
(2)
The company may also pay the directors’ travelling and other expenses that they properly incur:
(a)
in attending directors’ meetings or any meetings of committees of directors; and
(b)
in attending any general meetings of the company; and
(c)
in connection with the company’s business.

202BMembers may obtain information about directors’ remuneration

(1)
A company must disclose the remuneration paid to each director of the company or a subsidiary (if any) by the company or by an entity controlled by the company if the company is directed to disclose the information by:
(a)
members with at least 5% of the votes that may be cast at a general meeting of the company; or
(b)
at least 100 members who are entitled to vote at a general meeting of the company.
The company must disclose all remuneration paid to the director, regardless of whether it is paid to the director in relation to their capacity as director or another capacity.
(2)
The company must comply with the direction as soon as practicable by:
(a)
preparing a statement of the remuneration of each director of the company or subsidiary for the last financial year before the direction was given; and
(b)
having the statement audited; and
(c)
sending a copy of the audited statement to each person entitled to receive notice of general meetings of the company.

202CSpecial rule for single director/single shareholder proprietary companies

A person who is the only director and the only shareholder of a proprietary company is to be paid any remuneration for being a director that the company determines by resolution. The company may also pay the director’s travelling and other expenses properly incurred by the director in connection with the company’s business.

Division 3—Resignation, retirement or removal of directors

203ADirector may resign by giving written notice to company (replaceable rule—see section 135)

A director of a company may resign as a director of the company by giving a written notice of resignation to the company at its registered office.

203BSignpost to consequences of disqualification from managing corporations

A person ceases to be a director of a company if the person becomes disqualified from managing corporations under Part 2D.6 (see subsection 206A(2)) unless ASIC or the Court allows them to manage the company (see sections 206F and 206G).

203CRemoval by members—proprietary companies (replaceable rule—see section 135)

A proprietary company:
(a)
may by resolution remove a director from office; and
(b)
may by resolution appoint another person as a director instead.

203DRemoval by members—public companies

Resolution for removal of director
(1)
A public company may by resolution remove a director from office despite anything in:
(a)
the company’s constitution (if any); or
(b)
an agreement between the company and the director; or
(c)
an agreement between any or all members of the company and the director.
If the director was appointed to represent the interests of particular shareholders or debenture holders, the resolution to remove the director does not take effect until a replacement to represent their interests has been appointed.
Note: See sections 249C to 249G for the rules on who may call meetings, sections 249H to 249M on how to call meetings and sections 249N to 249Q for rules on members’ resolutions.
Notice of intention to move resolution for removal of director
(2)
Notice of intention to move the resolution must be given to the company at least 2 months before the meeting is to be held. However, if the company calls a meeting after the notice of intention is given under this subsection, the meeting may pass the resolution even though the meeting is held less than 2 months after the notice of intention is given.
Note: Short notice of the meeting cannot be given for this resolution (see subsection 249H(3)).
Director to be informed
(3)
The company must give the director a copy of the notice as soon as practicable after it is received.
Director’s right to put case to members
(4)
The director is entitled to put their case to members by:
(a)
giving the company a written statement for circulation to members (see subsections (5) and (6)); and
(b)
speaking to the motion at the meeting (whether or not the director is a member of the company).
(5)
The written statement is to be circulated by the company to members by:
(a)
sending a copy to everyone to whom notice of the meeting is sent if there is time to do so; or
(b)
if there is not time to comply with paragraph (a)—having the statement distributed to members attending the meeting and read out at the meeting before the resolution is voted on.

(6)
The director’s statement does not have to be circulated to members if it is more than 1,000 words long or defamatory.
Time of retirement
(7)
If a person is appointed to replace a director removed under this section, the time at which:
(a)
the replacement director; or
(b)
any other director;
is to retire is to be worked out as if the replacement director had become director on the day on which the replaced director was last appointed a director.

203EDirector cannot be removed by other directors—public companies

A resolution, request or notice of any or all of the directors of a public company is void to the extent that it purports to:
(a)
remove a director from their office; or
(b)
require a director to vacate their office.

203FTermination of appointment of managing director (replaceable rule—see section 135)

(1)
A person ceases to be managing director if they cease to be a director.
(2)
The directors may revoke or vary an appointment of a managing director.

Part 2D.4—Appointment of secretaries

204AMinimum number of secretaries

Proprietary companies
(1)
A proprietary company is not required to have a secretary but, if it does have 1 or more secretaries, at least 1 of them must ordinarily reside in Australia.
Public companies
(2)
A public company must have at least 1 secretary. At least 1 of them must ordinarily reside in Australia.

204BWho can be a secretary

(1)
Only an individual who is at least 18 may be appointed as a secretary of a company.
(2)
A person who is disqualified from managing corporations under Part 2D.6 may only be appointed as a secretary of a company if the appointment is made with permission granted by ASIC under section 206F or leave granted by the Court under section 206G.

204CConsent to act as secretary

(1)
A company contravenes this subsection if a person does not give the company a signed consent to act as secretary of the company before being appointed.
(2)
The company must keep the consent.

204DHow a secretary is appointed

A secretary is to be appointed by the directors.
Note 1: The company must notify ASIC of the appointment within 14 days (see subsection 205B(1)).
Note 2: Section 188 deals with the responsibilities of secretaries for contraventions by the company.

204EEffectiveness of acts by secretaries

(1)
An act done by a secretary is effective even if their appointment, or the continuance of their appointment, is invalid because the company or secretary did not comply with the company’s constitution (if any) or any provision of this Law.
(2)
Subsection (1) does not deal with the question whether an effective act by a secretary:
(a)
binds the company in its dealings with other people; or
(b)
makes the company liable to another person.
Note: The kinds of acts that this section validates are those that are only legally effective if the person doing them is a secretary (for example, signing and sending out a notice of a meeting of directors if the company’s constitution authorises the secretary to do so or signing a document to be lodged with ASIC). Sections 128‑130 contain rules about the assumptions people are entitled to make when dealing with a company and its officers.

204FTerms and conditions of office for secretaries (replaceable rule—see section 135)

A secretary holds office on the terms and conditions (including as to remuneration) that the directors determine.

204GSignpost to consequences of disqualification from managing corporations

A person ceases to be a secretary of a company if the person becomes disqualified from managing corporations under Part 2D.6 (see subsection 206A(2)) unless ASIC or the Court allows them to manage the company (see sections 206F and 206G).

Part 2D.5—Public information about directors and secretaries

205ADirector, secretary or alternate director may notify ASIC of resignation or retirement

(1)
If a director, secretary or alternate director retires or resigns, they may give ASIC written notice of the retirement or resignation. The notice must be in the prescribed form.
(2)
To be effective, a notice of resignation must be accompanied by a copy of the letter of resignation given to the company.
(3)
Nothing in this section affects the company’s obligations to notify ASIC of the resignation or retirement.

205BNotice of name and address of directors and secretaries to ASIC

New directors or secretaries
(1)
A company must lodge with ASIC a notice of the personal details of a director or secretary within 14 days after they are appointed. The notice must be in the prescribed form.
Note 1: If a person becomes a director under subsection 120(1) there is no appointment and no notice is required under this subsection.
Note 2: If a person who was appointed as an alternate director becomes a director under the terms of their appointment as an alternate director, there is no appointment as a director and no notice is required under this subsection.
New alternate directors
(2)
A company must lodge with ASIC a notice of:
(a)
the personal details of a person who is appointed as an alternate director; and
(b)
the terms of their appointment (including terms about when the alternate director is to act as a director);
within 14 days after their appointment as an alternate director. The notice must be in the prescribed form.
Personal details
(3)
The personal details of a director, alternate director, or secretary are:
(a)
their given and family names; and
(b)
all of their former given and family names; and
(c)
their date and place of birth; and
(d)
their address.
Note: For address see section 205D.
Changes in details
(4)
The company must lodge with ASIC notice of any change in the personal details of a director, alternate director or secretary within 14 days after the change. The notice must be in the prescribed form.
Notice required if person stops being a director or secretary
(5)
If a person stops being a director, alternate director or secretary of the company, the company must lodge with ASIC notice of the fact within 14 days. The notice must be in the prescribed form. However, the company does not need to lodge a notice if the person was an alternate director who stopped being a director in accordance with the terms of their appointment as an alternate director.

205CDirector and secretary must give information to company

(1)
A director, alternate director or secretary must give the company any information the company needs to comply with subsection 205B(1) or (2) within 7 days after their initial appointment unless they have previously given the information to the company.
(2)
A director, alternate director or secretary must give the company any information the company needs to comply with subsection 205B(4) within 7 days after any change in their personal details.

205DAddress for officers

Address is normally residential address
(1)
A person’s address for the purposes of a notice or application under subsection 205B(1), (2), (3) or (5) or 117(2) or 601BC(2) must be their usual residential address unless they are entitled to have an alternative address substituted for their usual residential address under subsection (2).
Entitlement to have alternative address
(2)
The person is entitled to have an alternative address substituted for their usual residential address if:
(a)
their name, but not their residential address, is on an electoral roll under the Commonwealth Electoral Act 1918 because of section 104 of that Act; or
(b)
their name is not on an electoral roll under that Act and ASIC determines, in writing, that including their residential address in the notice or application would put at risk their personal safety or the personal safety of members of their family.
This alternative address must be in Australia and be one at which documents can be served on the person. At any particular time, a person is entitled to have only 1 alternative address under this section.
Note: See subsection 109X(2) on the status of the alternative address as an address for service.
(3)
A person who takes advantage of subsection (2) must:
(a)
before or at the same time as the alternative address is first included in a notice or application, lodge with ASIC notice of the person’s usual residential address; and
(b)
lodge with ASIC notice of any change in the person’s usual residential address within 14 days after the change.
A notice under this subsection must be in the prescribed form.
(4)
If a court gives a judgment for payment of a sum of money against a person who is taking advantage of subsection (2), ASIC may give details of the person’s usual residential address to an officer of the court for the purposes of enforcing the judgment debt.

205EASIC’s power to ask for information about person’s position as director or secretary

(1)
ASIC may ask a person, in writing, to inform ASIC:
(a)
whether the person is a director or secretary of a particular company; and
(b)
if the person is no longer a director or secretary of the company—the date on which the person stopped being a director or secretary.
(2)
The person must give the information to ASIC in writing by the date specified in the request.

205FDirector must give information to company

A director must give the company any information affecting or relating to the director that the company needs, or will need, to comply with Chapter 6. The director must give the information to the company as soon as practicable after becoming aware that the company needs, or will need, the information. The company must give the information to each of the other directors of the company within 7 days of receiving it.

205GListed company—director to notify securities exchange of shareholdings etc.

Notifiable interests
(1)
A director of a listed public company must notify the relevant securities exchange under subsections (3) and (4) of the following interests of the director:
(a)
relevant interests in securities of the company or a related body corporate
(b)
contracts:
(i)
to which the director is a party or under which the director is entitled to a benefit; and
(ii)
that confer a right to call for or deliver shares in, debentures of, or interests in a collective investment scheme made available by, the company or a related body corporate.
(2)
A notice of a relevant interest in securities under paragraph (1)(a) must give details of:
(a)
the number of securities; and
(b)
the circumstances giving rise to the relevant interest.
Occasions for initial notification
(3)
The director must notify the exchange within 14 days after each of the following occasions:
(a)
appointment as a director of the company
(b)
the listing of the company.
Paragraph (a) does not apply to a director who retires and is then reappointed at the same meeting.
Updating notices
(4)
The director must notify the exchange within 14 days after any change in the director’s interests.
(5)
The director need not give the information to the exchange under this section if the director has already given the information to the exchange.
ASIC’s power to make class orders
(6)
ASIC may make an order in writing relieving a director of the obligation to notify the relevant securities exchange of an interest in a security or contract. The order may be made in respect of a specified class of companies, directors, securities or contracts.
(7)
The order may be expressed to be subject to conditions.
(8)
Notice of the making, revocation or suspension of the order must be published in the Gazette.

Part 2D.6—Disqualification from managing corporations

206ADisqualified person not to manage corporations

(1)
A person who is disqualified from managing corporations under this Part commits an offence if:
(a)
they make, or participate in making, decisions that affect the whole, or a substantial part, of the business of the corporation; or
(b)
they exercise the capacity to affect significantly the corporation’s financial standing; or
(c)
they communicate instructions or wishes (other than advice given by the person in the proper performance of functions attaching to the person’s professional capacity or their business relationship with the directors or the corporation) to the directors of the corporation:
(i)
knowing that the directors are accustomed to act in accordance with the person’s instructions or wishes; or
(ii)
intending that the directors will act in accordance with those instructions or wishes.
It is a defence to the contravention if the person had permission to manage the corporation under either section 206F or 206G and their conduct was within the terms of that permission.
Note: Under section 1274AA, ASIC is required to keep a record of persons disqualified from managing corporations.
(2)
A person ceases to be a director, alternate director or a secretary of a company if:
(a)
the person becomes disqualified from managing corporations under this Part; and
(b)
they are not given permission to manage the corporation under section 206F or 206G.
Note: If a person ceases to be a director, alternate director or a secretary under subsection (2) the company must notify ASIC (see subsection 205B(1)).

206BAutomatic disqualification

Convictions
(1)
A person becomes disqualified from managing corporations if the person:
(a)
is convicted on indictment of an offence that:
(i)
concerns the making, or participation in making, of decisions that affect the whole or a substantial part of the business of the corporation; or
(ii)
concerns an act that has the capacity to affect significantly the corporation’s financial standing; or
(b)
is convicted of an offence that:
(i)
is a contravention of the Corporations Law and is punishable by imprisonment for a period greater than 12 months; or
(ii)
involves dishonesty and is punishable by imprisonment for at least 3 months; or
(c)
is convicted of an offence against the law of a foreign country that is punishable by imprisonment for a period greater than 12 months.
The offences covered by paragraph (a) and subparagraph (b)(ii) include offences against the law of a foreign country.
(2)
The period of disqualification under subsection (1) starts on the day the person is convicted and lasts for:
(a)
if the person does not serve a term of imprisonment—5 years after the day on which they are convicted; or
(b)
if the person serves a term of imprisonment—5 years after the day on which they are released from prison.
Bankruptcy, deed of arrangement or composition with creditors
(3)
A person is disqualified from managing corporations if the person is an undischarged bankrupt under the law of Australia, its external territories or another country.
(4)
A person is disqualified from managing corporations if:
(a)
the person has executed a deed of arrangement under Part X of the Bankruptcy Act 1966 (or a similar law of an external territory or another country) and the terms of the deed have not been fully complied with; or
(b)
the person’s creditors have accepted a composition under Part X of the Bankruptcy Act 1966 (or a similar law of an external territory or another country) and final payment has not been made under the composition.

206CCourt power of disqualification—contravention of civil penalty provision

(1)
On application by ASIC, the Court may disqualify a person from managing corporations for a period that the Court considers appropriate if:
(a)
a declaration is made under section 1317E (civil penalty provision) that the person has contravened a civil penalty provision; and
(b)
the Court is satisfied that the disqualification is justified.
Note: The civil penalty provisions are subsection 180(1) and (2), 181(1) and (2), 182(1) and (2), 183(1) and (2), 209(2), 254L(2), 256D(3), 259F(2), 260D(2) or 344(1) or section 588G.
(2)
In determining whether the disqualification is justified, the Court may have regard to:
(a)
the person’s conduct in relation to the management, business or property of any corporation; and
(b)
any other matters that the Court considers appropriate.

206DCourt power of disqualification—insolvency and non‑payment of debts

(1)
On application by ASIC, the Court may disqualify a person from managing corporations for up to 10 years if:
(a)
within the last 7 years, the person has been an officer of 2 or more corporations when they have failed; and
(b)
the Court is satisfied that:
(i)
the manner in which the corporation was managed was wholly or partly responsible for the corporation failing; and
(ii)
the disqualification is justified.
(2)
For the purposes of subsection (1), a corporation fails if:
(a)
a Court orders the corporation to be wound up under section 459B because the Court is satisfied that the corporation is insolvent; or
(b)
the corporation enters into voluntary liquidation and creditors are not fully paid or are unlikely to be fully paid; or
(c)
the corporation executes a deed of company arrangement and creditors are not fully paid or are unlikely to be fully paid; or
(d)
the corporation ceases to carry on business and creditors are not fully paid or are unlikely to be fully paid; or
(e)
a levy of execution against the corporation is not satisfied; or
(f)
a receiver, receiver and manager, or provisional liquidator is appointed in relation to the corporation; or
(g)
the corporation enters into a compromise or arrangement with its creditors under Part 5.1; or
(h)
the corporation is wound up and a liquidator lodges a report under subsection 533(1) about the corporation’s inability to pay its debts.
Note: To satisfy paragraph (h), a corporation must begin to be wound up while the person is an officer or within 12 months after the person ceases to be an officer. However, the report under subsection 533(1) may be lodged by the liquidator at a time that is more than 12 months after the person ceases to be an officer. Sections 513A to 513D contain rules about when a company begins to be wound up.
(3)
In determining whether the disqualification is justified, the Court may have regard to:
(a)
the person’s conduct in relation to the management, business or property of any corporation; and
(b)
any other matters that the Court considers appropriate.

206ECourt power of disqualification—repeated contraventions of Law

(1)
On application by ASIC, the Court may disqualify a person from managing corporations for the period that the Court considers appropriate if:
(a)
the person:
(i)
has at least twice been an officer of a body corporate that has contravened this Law while they were an officer of the body corporate and each time the person has failed to take reasonable steps to prevent the contravention; or
(ii)
has at least twice contravened this Law while they were an officer of a body corporate; or
(iii)
has been an officer of a body corporate and has done something that would have contravened subsection 180(1) or section 181 if the body corporate had been a corporation; and
(b)
the Court is satisfied that the disqualification is justified.
(2)
In determining whether the disqualification is justified, the Court may have regard to:
(a)
the person’s conduct in relation to the management, business or property of any corporation; and
(b)
any other matters that the Court considers appropriate.

206FASIC’s power of disqualification

Power to disqualify
(1)
ASIC may disqualify a person from managing corporations for up to 5 years if:
(a)
within 7 years immediately before ASIC gives a notice under paragraph (b)(i):
(i)
the person has been an officer of 2 or more corporations; and
(ii)
while the person was an officer, or within 12 months after the person ceased to be an officer of those corporations, each of the corporations was wound up and a liquidator lodged a report under subsection 533(1) about the corporation’s inability to pay its debts; and
(b)
ASIC has given the person:
(i)
a notice in the prescribed form requiring them to demonstrate why they should not be disqualified; and
(ii)
an opportunity to be heard on the question; and
(c)
ASIC is satisfied that the disqualification is justified.
Grounds for disqualification
(2)
In determining whether disqualification is justified, ASIC:
(a)
must have regard to whether any of the corporations mentioned in subsection (1) were related to one another; and
(b)
may have regard to:
(i)
the person’s conduct in relation to the management, business or property of any corporation; and
(ii)
any other matters that ASIC considers appropriate.

Schedule 2 to the old Law continues to apply in relation to the application
6	before commencement, a person was granted leave under subclause 8(2) of Schedule 2 to the old Law	the leave has effect as if it were granted under subsection 27C(4) of the new Law

4Contraventions of, and offences against, civil penalty provisions

(1)
Schedule 2 to the old Law continues to apply in relation to:
(a)
a contravention of a civil penalty provision listed in clause 2 of Schedule 2 to the old Law; or
(b)
an offence committed against one of those civil penalty provisions;
despite its repeal.
(2)
Schedule 2 to the new Law applies in relation to a contravention of a civil penalty provision listed in subclause 1(1) of Schedule 2 to the new law.

5Civil penalty orders made under old Law

(1)
An order in force under paragraph 4(a) of Schedule 2 to the old Law immediately before commencement continues to have effect after commencement as if it were made under section 27C of the new Law.
(2)
An order in force under paragraph 4(b) of Schedule 2 to the old Law immediately before commencement continues to have effect after commencement as if it were made under clause 3 of Schedule 2 to the new Law.

Commonwealth Serum Laboratories Act 1961

Subsection 19B(3)

Repeal the subsection, substitute:
(3)
For the purposes of this Part, a person has a relevant interest in a share if, and only if, the person would be taken to have a relevant interest in the share for the purposes of the Corporations Law if paragraph 608(3)(a) of that Law were disregarded.

Corporations Act 1989

After subsection 17(1)

Insert:
(1A)
Chapters 6, 6A, 6B, 6C and 6D of the Corporations Law of the Capital Territory:
(a)
bind the Crown in right of the Commonwealth; and
(b)
do not bind the Crown in right of any State, of the Capital Territory, of the Northern Territory or of Norfolk Island.

At the end of section 18

Add:
(2)
Chapters 6, 6A, 6B, 6C and 6D of the Corporations Law of each jurisdiction other than the Capital Territory bind the Crown in right of the Commonwealth.

Section 30

After “Chapter” (wherever occurring), insert “6D,”.
Note: The heading to section 30 is altered by inserting “6D,” after “Chapter”.

Income Tax Assessment Act 1997

Paragraph 166-245(1)(a)

Omit “709”, substitute “671B”.

Paragraph 166-245(1)(b)

Omit “710”, substitute “671B”.

Paragraph 166-245(2)(a)

Omit “710”, substitute “671B”.

Paragraph 166-245(2)(b)

Omit “711”, substitute “671B”.
21
Section 995-1 (definition of relevant interest)
Repeal the definition, substitute:
relevant interest has the same meaning as in the Corporations Law.

Life Insurance Act 1995

Section 238

Omit “Part 7.12”, substitute “Chapter 6D”.

Section 238

Omit “prospectus”, substitute “disclosure document”.
Note: The heading to section 238 is altered by omitting “Prospectus” and substituting “Disclosure document”.

Subsection 239(1)

Repeal the subsection, substitute:
(1)
This section applies if:
(a)
a life company or the holding company of a life company:
(i)
lodges a document, or a copy of a document, with ASIC; or
(ii)
is given a document, or a copy of a document;
for the purposes of a provision in Parts 6.4 to 6.8 of the Corporations Law of a State or an internal Territory; and
(b)
the document:
(i)
relates to an off-market bid; and
(ii)
is not given under section 641 of that Law.
Note: The heading to section 239 is altered by omitting “takeover schemes” and substituting “off-market takeover bids”.

Subsection 239(2)

Omit “paragraph (1)(a) or (b)”, substitute “subsection (1)”.

Qantas Sale Act 1992

Subsection 7(2)

Repeal the subsection, substitute:
(2)
For the purposes of this section, a person has a relevant interest in a share if, and only if, the person would be taken to have a relevant interest in the share for the purposes of the Corporations Law if paragraph 608(3)(a) of that Law were disregarded.

Subsection 9(3)

Repeal the subsection, substitute:
(3)
For the purposes of this section, a person has a relevant interest in a share if, and only if, the person would be taken to have a relevant interest in the share for the purposes of the Corporations Law if paragraph 608(3)(a) of that Law were disregarded.

Schedule 6Miscellaneous amendments of the Corporations Law

1
Section 9 (at the end of the definition of contributory)
Add:
1. (c)
  in relation to a no liability company—subject to section 385, a member of the company.
2
Section 9 (both definitions of financial statements)
Repeal the definitions, substitute:
financial statements means annual financial statements under section 295 or half‑year financial statements under section 303.

Before paragraph 66A(6)(c)

Insert:
(a)
the Cullen Bay Marina Management Corporation;

Subsection 227(3)

Repeal the subsection.

After subsection 249D(1)

Insert:
(1A)
The regulations may prescribe a different number of members for the purposes of the application of paragraph (1)(b) to:
(a)
a particular company; or
(b)
a particular class of company.
Without limiting this, the regulations may specify the number as a percentage of the total number of members of the company.

After subsection 249N(1)

Insert:
(1A)
The regulations may prescribe a different number of members for the purposes of the application of paragraph (1)(b) to:
(a)
a particular company; or
(b)
a particular class of company.
Without limiting this, the regulations may specify the number as a percentage of the total number of members of the company.

After subsection 249P(2)

Insert:
(2A)
The regulations may prescribe a different number of members for the purposes of the application of paragraph (2)(b) to:
(a)
a particular company; or
(b)
a particular class of company.
Without limiting this, the regulations may specify the number as a percentage of the total number of members of the company.

After subsection 252B(1)

Insert:
(1A)
The regulations may prescribe a different number of members for the purposes of the application of paragraph (1)(b) to:
(a)
a particular scheme; or
(b)
a particular class of scheme.
Without limiting this, the regulations may specify the number as a percentage of the total number of members of the scheme.

After subsection 252L(1)

Insert:
(1A)
The regulations may prescribe a different number of members for the purposes of the application of paragraph (1)(b) to:
(a)
a particular scheme; or
(b)
a particular class of scheme.
Without limiting this, the regulations may specify the number as a percentage of the total number of members of the scheme.

10 After subsection 252N(2)

Insert:
(2A)
The regulations may prescribe a different number of members for the purposes of the application of paragraph (2)(b) to:
(a)
a particular scheme; or
(b)
a particular class of scheme.
Without limiting this, the regulations may specify the number as a percentage of the total number of members of the scheme.

Subsection 329(1)

Omit “special notice”, substitute “notice under subsection (1A)”.

Subsection 329(2)

Omit “special notice”, substitute “notice under subsection (1A)”.

Subsection 340(1)

Omit “and 2M.3”, substitute “, 2M.3 and 2M.4”.

Subsection 341(1)

Omit “and 2M.3”, substitute “, 2M.3 and 2M.4”.

Subsection 342(1)

Omit “and 2M.3”, substitute “, 2M.3 and 2M.4”.

Subsection 1209(6)

Repeal the subsection, substitute:
(6)
A futures broker must not deal with property deposited by the broker in safe custody under subsection (3) except:
(a)
in accordance with the terms and conditions on which it was deposited with, or received by, the broker; or
(b)
for the purpose of meeting obligations incurred by the broker in connection with margining, guaranteeing, securing, transferring, adjusting or settling dealings in futures contracts effected by the broker on behalf of clients only.

Schedule 7Miscellaneous amendments of other Acts

Australian Securities and Investments Commission Act 1989

Subsection 12GB(1)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.
Note: The heading to section 12GB is altered by omitting “or E”.

Paragraph 12GB(2)(a)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Paragraph 12GB(3)(a)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Subsection 12GB(4)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Section 12GE

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Subsection 12GF(1)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Subsection 12GI(1)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Subsection 12GI(4)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Subsection 12GI(4)

Omit “or E” (second occurring).

Paragraph 12GM(5)(b)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Paragraph 12GN(1)(c)

Omit “Subdivision D or E (sections 12DA to 12ED)”, substitute “Subdivision D (sections 12DA to 12DN)”.

Section 123

Repeal the section, substitute:

123Members to disclose certain interests to Minister

(1)
A member must, in accordance with this section, disclose to the Minister:
(a)
any direct or indirect pecuniary interest that the member has or acquires in:
(i)
a body corporate carrying on business in Australia; or
(ii)
a business in Australia; and
(b)
any direct or indirect pecuniary interest that the member has or acquires in interests (including securities, futures contracts or other financial products) regulated by the Commission; and
(c)
any agreement, understanding or expectation that the member will:
(i)
resume a previous business relationship (whether or not that relationship existed immediately before the member’s appointment); or
(ii)
enter into a new business relationship;
when the member ceases to be a member; and
(d)
any severance arrangement or ongoing financial arrangement that takes account of an agreement, understanding or expectation that must be disclosed under paragraph (c).
(2)
For the purpose of paragraph (1)(b), interests are regulated by the Commission if the Commission has a function or power in relation to any aspect of the acquisition, holding, disposal or provision of the interests, or of interests of that kind.
(3)
In disclosing an indirect pecuniary interest in securities, futures contracts or other financial products, the member must identify the particular securities, futures contracts or products.
(4)
Paragraphs (1)(c) and (d) apply to agreements or understandings entered into, or expectations arising, before or after the member’s appointment.
(5)
Paragraph (1)(c) does not require a member to disclose an expectation to enter into a new business relationship unless the member can identify the other party, or one or more other parties, to the relationship. Disclosure is required whether or not the field of business or legal nature of the relationship has been determined.
(6)
A disclosure under this section must be made in writing.

Paragraph 124(1)(b)

Omit “or other interest”, substitute “interest, or a direct or indirect interest of any other kind,”.

Paragraph 127(1D)(c)

Repeal the paragraph.

Subsection 135(4)

Repeal the subsection, substitute:
(4)
This section and subsection 18(3) of the Commonwealth Authorities and Companies Act 1997 have effect subject to a provision that a national scheme law of this or any other jurisdiction makes about money or property that vests in the Commission under such a law.

At the end of subsection 138(1)

Add:
; and (d)
describe the performance indicators used by the Commission and the Commission’s performance against those indicators.

After subsection 243D(5)

Insert:
(5A)
If a cash dealer communicates to the Director, under subsection (1), information about the cash dealer’s suspicion in relation to a transaction to which the cash dealer is a party, the cash dealer must not, unless required to do so under the ASC Law, the Corporations Law or an Act of the Commonwealth, disclose to anyone else:
(a)
that the cash dealer has formed the suspicion; or
(b)
that information has been communicated to the Director; or
(c)
any other information from which the person to whom the information is disclosed could reasonably be expected to infer that:
(i)
the suspicion had been formed; or
(ii)
the first-mentioned information had been communicated.
(5B)
If a cash dealer gives further information pursuant to a request under subsection (4), the cash dealer must not, unless required to do so under the ASC Law or an Act of the Commonwealth, disclose to anyone else:
(a)
that the information has been given; or
(b)
any other information from which the person to whom the information is disclosed could reasonably be expected to infer that the first-mentioned information had been given.
(5C)
A cash dealer who contravenes subsection (5A) or (5B) is guilty of an offence punishable, upon conviction, by:
(a)
a fine of not more than 120 penalty units or imprisonment for not more than 2 years, or both, if the cash dealer is a natural person; or
(b)
a fine of not more than 600 penalty units if the cash dealer is a body corporate.
(5D)
Neither subsection (5A) nor subsection (5B) prohibits a cash dealer from communicating or disclosing a fact or information referred to in either of those subsections:
(a)
to the Australian Stock Exchange Limited; or
(b)
to the Commission; or
(c)
to a body corporate approved under section 769 of the Corporations Law as a stock exchange; or
(d)
to a body corporate approved under section 770 of the Corporations Law as an approved securities organisation; or
(e)
in accordance with conditions imposed by the Minister when approving under section 770A of the Corporations Law a stock market for electronic trading of interests in a registered scheme; or
(f)
in accordance with conditions imposed by the Minister when declaring a specified stock market to be an exempt stock market under section 771 of the Corporations Law; or
(g)
to a body corporate approved under section 779B of the Corporations Law as a securities clearing house; or
(h)
to a body corporate approved under section 1126 of the Corporations Law as a futures exchange; or
(i)
in accordance with conditions imposed by the Minister when declaring a specified futures market to be an exempt futures market under section 1127 of the Corporations Law; or
(j)
to a body corporate approved under section 1131 of the Corporations Law as a clearing house for a futures exchange; or
(k)
to a body corporate approved under section 1132 of the Corporations Law as a futures association.
(5E)
Neither subsection (5A) nor subsection (5B) prohibits a cash dealer from communicating or disclosing to any court any information, or matter, referred to in that subsection, but this subsection does not affect the operation of subsection (5F).
(5F)
In any legal proceeding (other than a prosecution for an offence against subsection 29(1) or 30(1) of the Financial Transaction Reports Act 1988 (which relate to false and misleading information or incomplete information) as applied by subsection (7) of this section):
(a)
none of the following is admissible in evidence:
(i)
a report prepared (whether before or after the commencement of this subsection) under subsection (1);
(ii)
a copy of such a report;
(iii)
a document purporting to set out information contained in such a report;
(iv)
a document given under subsection (4); and
(b)
evidence is not admissible as to:
(i)
whether or not a report was prepared under subsection (1); or
(ii)
whether or not a copy of a report prepared under that subsection, or a document purporting to set out information contained in such a report, was given to, or received by, the Director; or
(iii)
whether or not particular information was contained in a report prepared under that subsection; or
(iv)
whether or not particular information was given under subsection (4).
(5G)
In subsection (5F):
information includes the formation or existence of a suspicion referred to in subsection (1).

Financial Sector Reform (Consequential Amendments) Act 1998

Schedule 3 (heading)

Repeal the heading, substitute:

Schedule 3—Amendment of the Corporations Law set out in section 82 of the Corporations Act 1989

Note: The heading to section 12DL of the Australian Securities and Investments Commission Act 1989 is altered by omitting “credit and”.

Schedule 8Further amendment of the Corporations Law

Subsection 172(1)

After “this Chapter”, insert “that relates to a company”.

Subsection 172(1A)

Omit “Part”, substitute “Chapter”.

Subsection 243V(2)

Omit “(1)(d)”, substitute “(1)(e)”.

Paragraph 309(3)(b)

Omit “(d), (e) or (f)”, substitute “(b), (c) or (d)”.

At the end of section 314

Add:
(3)
If the accounting standards made for the purposes of paragraph (2)(a) require a discussion and analysis to be included in a concise financial report:
(a)
the auditor must report on whether the discussion and analysis complies with the requirements that the accounting standards lay down for the discussion and analysis; and
(b)
the auditor does not otherwise need to audit the statements made in the discussion and analysis.

Paragraph 334(4)(b)

After “ending”, insert “, or starting,”.

Heading to Part 2M.4

Repeal the heading, substitute:

Part 2M.4—Appointment and removal of auditors

After the Heading to Part 2M.4

Insert:

Division 1—Companies

Heading to Division 1A of Part 2M.4

Repeal the heading, substitute:

Division 2—Registered schemes

Paragraph 601CE(c)

Omit “242(3)”, substitute “242(2)”.

Paragraph 1085(1)(c)

Omit “constitution”, substitute “constitution (if any) and any replaceable rules that apply to the company”.

Section 601LA

Omit “Part 3.2A”, substitute “Chapter 2E”.
Note: The heading to section 601LA is altered by omitting “Part 3.2A” and substituting “Chapter 2E”.

Section 601LB

Omit “Part 3.2A”, substitute “Chapter 2E”.

Section 601LC

Omit “Part 3.2A”, substitute “Chapter 2E”.

Section 601LD

Omit “Part 3.2A”, substitute “Chapter 2E”.

Section 601LE

Omit “Part 3.2A”, substitute “Chapter 2E”.

Subsection 601QA(2)

Repeal the subsection, substitute:
(2)
The exemption or declaration may:
(a)
apply to all or specified provisions of this Chapter; and
(b)
apply to all persons, specified persons, or a specified class of persons; and
(c)
relate to all securities, specified securities or a specified class of securities; and
(d)
relate to any other matter generally or as specified.

Section 1465 (table item 1)

Omit “managed investment”, substitute “interest in a managed investment scheme”.
19
Division 11 of Part 11.2 (first occurring) (heading)
Repeal the heading, substitute:

Division 10A—Changes resulting from Schedule 5 to the Company Law Review Act 1998

Section 1451 (definition of old Law)

Omit “this law”, substitute “this Law”.

Schedule 3

Repeal the items relating to sections 1064, 1065, 1072 and 1074.

Schedule 9Further amendment of other legislation

Company Law Review Act 1998

Schedule 4

Omit “Australian Securities Commission Act 1989”, substitute “Australian Securities and Investments Commission Act 1989”.

Managed Investments Act 1998

2Part 2 of Schedule 2 (heading)

Repeal the heading, substitute:

Part 2—Amendment of the Australian Securities and Investments Commission Act 1989

Schedule 10—Amendments consequential on amendment of the Commonwealth Authorities and Companies Act 1997

Aboriginal and Torres Strait Islander Commission Act 1989

Paragraph 40(7)(e)

Omit “21”, substitute “27F or 27J”.

Paragraph 44(5)(a)

Omit “21”, substitute “27J”.

Subsection 44(13)

Omit “21”, substitute “27J”.

Paragraph 143S(6)(e)

Omit “21”, substitute “27F or 27J”.

Paragraph 144E(5)(a)

Omit “21”, substitute “27J”.

Subsection 144E(14)

Omit “21”, substitute “27J”.

Paragraph 165(2)(c)

Omit “21”, substitute “27F or 27J”.

Paragraph 167(3)(a)

Omit “21”, substitute “27J”.

Subsection 167(11)

Omit “21”, substitute “27J”.

Paragraph 192H(2)(e)

Omit “21”, substitute “27F or 27J”.

Paragraph 192J(3)(a)

Omit “21”, substitute “27J”.
Note: The heading to subsection 192J(3) is altered by omitting “21” and substituting “27J”.

Agricultural and Veterinary Chemicals (Administration) Act 1992

Paragraph 24(2)(b)

Omit “21”, substitute “27F or 27J”.

Australia Council Act 1975

Subparagraph 14(2)(a)(ii)

Omit “21”, substitute “27F or 27J”.

Subsection 15(6)

Omit “section 21”, substitute “sections 27F to 27L”.

Paragraph 19F(2)(e)

Omit “21”, substitute “27F or 27J”.

Subsection 27(2)

Omit “21”, substitute “27F or 27J”.

Australia New Zealand Food Authority Act 1991

Paragraph 52(2)(b)

Omit “21”, substitute “27F or 27J”.

Australian Broadcasting Corporation Act 1983

Subsection 17(1A)

Omit “21”, substitute “27F”.

Subparagraph 18(2)(a)(ii)

Omit “21”, substitute “27F or 27J”.

Australian Communications Authority Act 1997

Section 30

Omit “section 21”, substitute “sections 27F to 27L”.

Section 30

Omit “which deals with disclosure of interests”, substitute “which deal with disclosure of interests, restrictions on voting and access to records”.

Paragraph 37(4)(d)

Omit “21”, substitute “27F or 27J”.

Australian Film Commission Act 1975

Subparagraph 23(2)(a)(ii)

Omit “21”, substitute “27F or 27J”.

Australian Film, Television and Radio School Act 1973

Paragraph 18(c)

Omit “21”, substitute “27F or 27J”.

Paragraph 29(1)(c)

Omit “21”, substitute “27F or 27J”.

Australian Heritage Commission Act 1975

Paragraph 18(2)(c)

Omit “21”, substitute “27F or 27J”.

Section 19

Omit “section 21”, substitute “sections 27F to 27L”.
Note: The heading to section 19 is altered by omitting “section 21” and substituting “sections 27F to 27L”.

Paragraph 21(3)(a)

Omit “section 21”, substitute “sections 27F to 27L”.

Australian Horticultural Corporation Act 1987

Paragraph 24(2)(b)

Omit “21”, substitute “27F or 27J”.

Subsection 73(5)

Omit “Section 21”, substitute “Sections 27F to 27L”.

Subsection 73(5)

Omit “applies”, substitute “apply”.

Subsection 115ZB(5)

Omit “Section 21”, substitute “Sections 27F to 27L”.

Subsection 115ZB(5)

Omit “applies”, substitute “apply”.

Australian Institute of Aboriginal and Torres Strait Islander Studies Act 1989

Paragraph 21(2)(b)

Omit “21”, substitute “27F or 27J”.

Australian Institute of Health and Welfare Act 1987

Paragraph 13(2)(b)

Omit “21”, substitute “27F or 27J”.

Subsection 14(3)

Omit “Section 21”, substitute “Sections 27F and 27J”.

Subsection 14(3)

Omit “does”, substitute “do”.

Australian Institute of Marine Science Act 1972

Paragraph 16(c)

Omit “21”, substitute “27F or 27J”.

Paragraph 28(d)

Omit “21”, substitute “27F or 27J”.

Australian Law Reform Commission Act 1996

Paragraph 17(2)(b)

Omit “21”, substitute “27F or 27J”.

Australian Maritime Safety Authority Act 1990

Paragraph 21(2)(d)

Omit “21”, substitute “27F or 27J”.

Australian National Maritime Museum Act 1990

Paragraph 21(2)(c)

Omit “21”, substitute “27F or 27J”.

Subsection 23(6)

Omit “subsection 21(3)”, substitute “section 27J”.

Paragraph 36(2)(e)

Omit “21”, substitute “27F or 27J”.

Australian National University Act 1991

Paragraph 15(1)(e)

Omit “21”, substitute “27F or 27J”.

Australian Nuclear Science and Technology Organisation Act 1987

Paragraph 14(2)(c)

Omit “21”, substitute “27F or 27J”.

Subsection 16(6)

Omit “subsection 21(3)”, substitute “section 27J”.

Paragraph 21C(2)(d)

Omit “21”, substitute “27F or 27J”.

Australian Postal Corporation Act 1989

Subsection 67(2)

Omit “21”, substitute “27J”.

Section 71

Omit “Section 21”, substitute “Sections 27F and 27J”.

Section 71

Omit “does”, substitute “do”.

Paragraph 79(2)(b)

Omit “21”, substitute “27F or 27J”.

Australian Prudential Regulation Authority Act 1998

Paragraph 31(2)(e)

Omit “21”, substitute “27F or 27J”.

Paragraph 40(1)(e)

Omit “21”, substitute “27F or 27J”.

Australian Securities and Investments Commission Act 1989

Subsection 124(7)

Omit “Section 21”, substitute “Sections 27F to 27L”.

Australian Sports Commission Act 1989

Paragraph 19(2)(b)

Omit “21”, substitute “27F or 27J”.

Subsection 22(7)

Omit “Section 21”, substitute “Sections 27F to 27L”.

Subsection 22(7)

Omit “applies”, substitute “apply”.

Australian Tourist Commission Act 1987

Paragraph 21(2)(b)

Omit “21”, substitute “27F or 27J”.

Subsection 23(8)

Omit “21”, substitute “27J”.

Australian Trade Commission Act 1985

Paragraph 20(2)(d)

Omit “21”, substitute “27F or 27J”.

Australian War Memorial Act 1980

Paragraph 14(2)(c)

Omit “21”, substitute “27F or 27J”.

Australian Wine and Brandy Corporation Act 1980

Paragraph 20(4)(b)

Omit “21”, substitute “27F or 27J”.

Subsection 21(4)

Omit “section 21”, substitute “sections 27F and 27J”.

Australian Wool Research and Promotion Organisation Act 1993

Subsection 30(3)

Omit “section 21”, substitute “sections 27F and 27J”.

Paragraph 33(2)(c)

Omit “21”, substitute “27F or 27J”.

Paragraph 42(4)(c)

Omit “21”, substitute “27F or 27J”.

Broadcasting Services Act 1992

Paragraph 9(3)(e) of Schedule 3

Omit “21”, substitute “27F or 27J”.

Civil Aviation Act 1988

Paragraph 42(2)(d)

Omit “21”, substitute “27F or 27J”.

Coal Mining Industry (Long Service Leave Funding) Act 1992

Paragraph 28(2)(c)

Omit “21”, substitute “27F or 27J”.

Dairy Produce Act 1986

Section 35

Omit “section 21”, substitute “sections 27F and 27J”.

Paragraph 38(3)(c)

Omit “21”, substitute “27F or 27J”.

Subsection 46(2)

Omit “Section 21”, substitute “Sections 27F to 27L”.

Subsection 46(2)

Omit “applies”, substitute “apply”.

Paragraph 47(4)(d)

Omit “21”, substitute “27F or 27J”.

Defence Housing Authority Act 1987

Subsection 20(4)

Omit “section 21”, substitute “sections 27F and 27J”.

Paragraph 21(2)(b)

Omit “21”, substitute “27F or 27J”.

Subsection 26(6)

Omit “Section 21”, substitute “Sections 27F to 27L”.

Subsection 26(6)

Omit “applies”, substitute “apply”.

Employment Services Act 1994

Paragraph 87(2)(e)

Omit “21”, substitute “27F or 27J”.

Paragraph 89(3)(a)

Omit “21”, substitute “27F or 27J”.

Export Finance and Insurance Corporation Act 1991

Paragraph 42(3)(c)

Omit “21”, substitute “27F or 27J”.

Family Law Act 1975

Paragraph 114J(2)(d)

Omit “21”, substitute “27F or 27J”.

Fisheries Administration Act 1991

Paragraph 21(2)(b)

Omit “21”, substitute “27F or 27J”.

Great Barrier Reef Marine Park Act 1975

Paragraph 16(2)(e)

Omit “21”, substitute “27F or 27J”.

Health Insurance Commission Act 1973

Paragraph 17(2)(b)

Omit “21”, substitute “27F or 27J”.

Paragraph 26(2)(b)

Omit “21”, substitute “27F or 27J”.

Hearing Services Act 1991

Paragraph 31(2)(b)

Omit “21”, substitute “27F or 27J”.

Paragraph 46(2)(b)

Omit “21”, substitute “27F or 27J”.

Horticultural Research and Development Corporation Act 1987

Paragraph 23(2)(b)

Omit “21”, substitute “27F or 27J”.

Subsection 54(5)

Omit “Section 21”, substitute “Sections 27F to 27L”.

Subsection 54(5)

Omit “applies”, substitute “apply”.

Maritime College Act 1978

Paragraph 17(2)(b)

Omit “21”, substitute “27F or 27J”.

National Gallery Act 1975

Paragraph 17(2)(c)

Omit “21”, substitute “27F or 27J”.

Paragraph 29(2)(aa)

Omit “21”, substitute “27F or 27J”.

National Health Act 1953

Section 82BA

Omit “21”, substitute “27F to 27L”.

Subsection 82ZRAA(2)

Omit “Section 21”, substitute “Sections 27F to 27L”.

Subsection 82ZRAA(2)

Omit “does”, substitute “do”.

National Library Act 1960

Paragraph 15(1)(e)

Omit “21”, substitute “27F or 27J”.

100

Paragraph 17E(1)(aa)

Omit “21”, substitute “27F or 27J”.

National Measurement Act 1960

101

Paragraph 18AC(2)(c)

Omit “21”, substitute “27F or 27J”.

National Museum of Australia Act 1980

102

Paragraph 17(2)(c)

Omit “21”, substitute “27F or 27J”.

103

Paragraph 27(2)(e)

Omit “21”, substitute “27F or 27J”.

National Occupational Health and Safety Commission Act 1985

104

Paragraph 14(3)(b)

Omit “21”, substitute “27F or 27J”.

105

Subsection 14(6)

Omit “21”, substitute “27F or 27J”.

National Parks and Wildlife Conservation Act 1975

106

Subsection 15A(2)

Omit “Section 21”, substitute “Sections 27F to 27L”.

107

Subsection 15A(2)

Omit “does”, substitute “do”.

Pig Industry Act 1986

108

Paragraph 14(2)(b)

Omit “21”, substitute “27F or 27J”.

109

Subsection 15(1)

Omit “section 21”, substitute “sections 27F and 27J”.

Primary Industries and Energy Research and Development Act 1989

110

Paragraph 73(1)(c)

Omit “21”, substitute “27F or 27J”.

111

Subsection 100(2)

Omit “Section 21”, substitute “Sections 27F to 27L”.

112

Subsection 100(2)

Omit “applies”, substitute “apply”.

113

Paragraph 138(1)(g)

Omit “21”, substitute “27F or 27J”.

Reserve Bank Act 1959

114

Paragraph 18(1)(e)

Omit “21”, substitute “27F or 27J”.

Safety, Rehabilitation and Compensation Act 1988

115

Subsection 90(1)

Omit “section 21”, substitute “sections 27F to 27L”.

Science and Industry Research Act 1949

116

Paragraph 10E(2)(b)

Omit “21”, substitute “27F or 27J”.

117

Paragraph 22(2)(c)

Omit “21”, substitute “27F or 27J”.

Snowy Mountains Hydro‑electric Power Act 1949

118

Subsection 26(1)

Omit “section 21”, substitute “sections 27F to 27L”.

Special Broadcasting Service Act 1991

119

Subparagraph 27(2)(c)(ii)

Omit “21”, substitute “27F or 27J”.

120

Paragraph 37(2)(d)

Omit “21”, substitute “27F or 27J”.

121

Subsection 40(2)

Omit “subsection 21(3)”, substitute “section 27J”.

Wheat Marketing Act 1989

122

Paragraph 8(2)(b)

Omit “21”, substitute “27F or 27J”.

Schedule 11Amendment of the Corporations Law to deal with ASC Law and ASC Regulations references

Part 1—ASC Law references

Amendment of the Corporations Law

The specified provisions of the Corporations Law listed in this Part of this Schedule are amended by omitting “ASC Law” (wherever occurring) and substituting “ASIC Law”.

Section 2

Section 9 (definition of Commission delegate)

4
Section 9 (paragraph (b) of the definition of law)
5
Section 9 (paragraph (b) of the definition of scheme property)
6
Section 9 (definition of scheme property) (note 2)

Subparagraphs 88A(1)(a)(i) and (ii)

Paragraph 246AA(1)(b)

Paragraph 461(1)(h)

Subsection 464(1)

Subsection 553(2)

Subparagraph 583(c)(iii)

Paragraph 589(2)(a)

Paragraph 601(b)

Subsection 1271(2)

Subsection 1317R(8)

Paragraph 1323(1)(a)

Paragraph 1438(2)(a)

Part 2—ASC Regulations references

Amendment of the Corporations Law

The specified provisions of the Corporations Law listed in this Part of this Schedule are amended by omitting “ASC Regulations” (wherever occurring) and substituting “ASIC Regulations”.
20
Section 9 (paragraph (b) of the definition of law)

Schedule 12Amendment of other Acts to deal with ASC Law and ASC Regulation references

Part 1—ASC Law references

Amendment of Acts

The specified provisions of the Acts listed in this Part of this Schedule are amended by omitting “ASC Law” (wherever occurring) and substituting “ASIC Law”.
Note: The heading to section 40A of the Acts Interpretation Act 1901 is altered by omitting “ASC Law” and substituting “ASIC Law”.

Acts Interpretation Act 1901

Section 40A

Administrative Appeals Tribunal Act 1975

Paragraph 27A(2)(e)

Australian Securities and Investments Commission Act 1989

Subsection 1B(1)

Subsections 1C(2) and (3)

Subsections 1D(1), (2) and (4)

Paragraphs 1E(a) and (b)

8
Subsection 5(1) (paragraph (b) of the definition of examination)

Section 6A

Subsections 6E(1), (2) and (3)

Paragraph 88(1A)(b)

Paragraph 243A(a)

Subsections 243D(5A) and (5B)

Subsection 251(3)

Corporations Act 1989

15
Subsection 4(1) (paragraph (b) of the definition of applicable provision)
16
Subsection 4(1) (definition of ASC Law and ASC Regulations)
17
Subsection 4(1) (definition of Commonwealth law)

Paragraph 9(1A)(c)

Paragraph 37(b)

20
Section 38 (paragraph (c) of the definition of corresponding law)

Subparagraph 50(2)(a)(ii)

Subparagraph 63(2)(a)(ii)

Paragraph 75(c)

Evidence Act 1995

Subsection 8(3)

Financial Transaction Reports Act 1988

25
Subsection 3(1) (paragraph (b) of the definition of FTR information)

Part 2—ASC Regulations references

Amendment of Acts

The specified provisions of the Acts listed in this Part of this Schedule are amended by omitting “ASC Regulations” (wherever occurring) and substituting “ASIC Regulations”.
Note: The heading to section 251 of the Australian Securities and Investments Commission Act 1989 is amended by omitting “ASC” and substituting “ASIC”.

Acts Interpretation Act 1901

Section 40A

Australian Securities and Investments Commission Act 1989

Subsection 1B(2)

Subsection 1C(3)

Subsections 1D(2) and (4)

Paragraphs 1E(a) and (b)

Subsection 5(1) (definition of regulations)

Corporations Act 1989

33
Section 4 (paragraph (b) of the definition of applicable provisions)
34
Section 4 (definition of ASC Law and ASC Regulations)

Paragraph 9(1A)(c)

36
Section 38 (paragraph (c) of the definition of corresponding law)

Subparagraph 50(2)(a)(iii)

Subparagraph 63(2)(a)(iii)

39
Subsection 80(1) (definition of national scheme regulations of the Capital Territory)

[Minister’s second reading speech made in—

House of Representatives on 3 December 1998

Senate on 21 June 1999]

(190/98)