Corporations Legislation Amendment Act (No. 2) 1991 (Cth)
TABLE OF PROVISIONS PART 1—PRELIMINARY
Section
1. Short title
2. Commencement
PART 2—AMENDMENT OF THE CORPORATIONS ACT 1989
3. Amendment of section 52 of the
Corporations Act 1989 PART 3—AMENDMENTS OF THE CORPORATIONS LAW
4. Corporations Law
5. Amendments relating to the National Guarantee Fund
6. Amendments relating to fundraising
7. Amendments relating to registration numbers of companies and registrable bodies
8. Amendments relating to registration of charges
9. Miscellaneous substantive and technical amendments
10. Commencement and application of changes to the Corporations Law resulting from this Act
PART 4—AMENDMENT OF THE CORPORATIONS LEGISLATION AMENDMENT ACT 1990
11. Principal Act
12. Schedule 1
TABLE OF PROVISIONS—
continued
Section
PART 5—AMENDMENTS OF THE COMPANIES AND SECURITIES LEGISLATION (MISCELLANEOUS AMENDMENTS) ACT 1985
13. Principal Act
14. Repeal of sections 78, 80, 81, 83 and 116
PART 6—AMENDMENTS OF THE CO-OPERATIVE SCHEME LEGISLATION
AMENDMENT ACT 1989
15. Principal Act
16. Repeal of Parts 4 and 9
SCHEDULE 1
AMENDMENTS OF THE CORPORATIONS LAW RELATING TO THE NATIONAL GUARANTEE FUND
SCHEDULE 2
AMENDMENTS OF THE CORPORATIONS LAW RELATING TO FUNDRAISING
SCHEDULE 3
AMENDMENTS OF THE CORPORATIONS LAW RELATING TO REGISTRATION NUMBERS OF COMPANIES AND REGISTRABLE BODIES
SCHEDULE 4
AMENDMENTS OF THE CORPORATIONS LAW RELATING TO REGISTRATION OF CHARGES
SCHEDULE 5
MISCELLANEOUS SUBSTANTIVE AND TECHNICAL AMENDMENTS OF THE CORPORATIONS LAW
SCHEDULE
6
COMMENCEMENT AND APPLICATION OF CHANGES TO THE CORPORATIONS LAW RESULTING FROM THIS ACT
[
The Parliament of Australia enacts:
the
Section 5
AMENDMENTS OF THE CORPORATIONS LAW RELATING TO THE NATIONAL GUARANTEE FUND
After "6,", insert "6A, 6B, 6C,".
After "money" insert ", securities".
After "a transaction" insert "(other than a guaranteed securities loan)".
Omit the definition, substitute:
"
Insert:
"
(a) except in Division 7—includes marketable securities, or marketable rights, within the meaning of Division 3 of Part 7.13; and
(b) in Division 7—has the meaning given by subsection 955(1);
a transfer of securities of a particular kind and number to another person or partnership by:
(a) the first-mentioned person or partnership transferring securities of that kind and number to a clearing nominee of the participating exchange; and
(b) the clearing nominee transferring securities of that kind and number to the other person or partnership;
Insert in Division 1 of Part 7.10:
"924.(1) This section has effect for the purposes of this Part (other than Division 7).
"(2) A person (called the '
(a) except in the case of marketable rights within the meaning of Division 3 of Part 7.13—to become registered as the holder of the securities; or
(b) in the case of such marketable rights—to obtain the issue to the transferee of the securities to which the marketable rights relate;
without the transferor doing anything more, or causing anything more to be done, by way of executing or supplying documents.
"(3) If a person:
(a) causes property (other than securities or money) to be transferred to another person; or
(b) causes documents that are sufficient to enable another person to become the legal owner of property (other than securities or money) to be delivered to another person;
the first-mentioned person is taken to have transferred the property to the other person.
"(4) If a person causes money to be paid to another person, the first-mentioned person is taken to have paid the money to the other person.
"(5) In this section:
"924A. For the purposes of this Part, an agreement is novated if, and only if, because of the operation of a participating exchange's business rules, the agreement is discharged and replaced with one or more other agreements (each of which is called a '
"924B. If:
(a) either:
(i) a number of securities are transferred to a participating exchange or a member organisation of a participating exchange in respect of a number of transactions; or
(ii) a payment is made to a participating exchange or a member organisation of a participating exchange in respect of a number of transactions; and
(b) apart from this section, it is not possible to tell, for the purposes of this Part, how many of the securities are transferred, or how much of the payment is made, in respect of each of the transactions; and
(c) the business rules of the participating exchange include provisions determining how many of the securities are transferred, or how much of the payment is made, in respect of each of the transactions;
those provisions have effect accordingly for the purposes of this Part.".
After "954(5)" insert ", 954F(2), 954Q(2), 954Y(2), 959(3)".
Insert:
"(5A) A delegation under this section continues in force even if there is a change in the membership of the Board or of the sub-committee.".
Insert:
"927A.(1) A management sub-committee may delegate to:
(a) a member of the Board; or
(b) a member of the sub-committee; or
(c) an officer of SEGC;
all or any of the powers, authorities and discretions that have been delegated under subsection 927(2) to the sub-committee.
"(2) A delegation must be in writing signed by a majority of the members of the sub-committee.
"(3) A delegation may be varied or revoked at any time by writing signed by a majority of the members of the sub-committee.
"(4) A delegation continues in force even if there is a change in the membership of the sub-committee.
"(5) A power, authority or discretion performed or exercised by a person under a delegation is taken to have been exercised by the Board.
"(6) A delegation of a power, authority or discretion does not prevent the performance or exercise of the power, authority or discretion by the Board, or by the sub-committee that made the delegation.
"(7) Section 109ZE has effect in relation to a delegation subject to this section.
"(8) In this section:
Insert in Division 3 of Part 7.10:
"928A. In this Division, a reference to borrowing money includes a reference to obtaining credit.".
Insert:
"(fa) money paid into the Fund under subsection 930B(2);".
Omit the paragraph, substitute:
"(j) money paid to SEGC for the purposes of a claim under Division 6, 6A or 6C; and".
Insert:
"930A.(1) If the Board considers that, in the interests of the sound financial management of the Fund, money should be borrowed for the purpose of meeting a payment due out of the Fund, SEGC may borrow money for that purpose on such terms and conditions as the Board thinks appropriate.
"(2) SEGC may give security, including security over the assets of the Fund, in respect of SEGC's obligations in relation to a borrowing under subsection (1).
"(3) If:
(a) money borrowed under subsection (1) is a loan from a participating exchange; and
(b) the participating exchange borrowed money for the purpose of making the loan to SEGC;
SEGC may give security, including security over the assets of the Fund, in relation to the participating exchange's obligations in respect of the borrowing referred to in paragraph (b).
"930B.(1) This section applies where money borrowed by SEGC under subsection 930A(1) is paid to SEGC.
"(2) SEGC must pay the money into the Fund.
"(3) If:
(a) the money was borrowed for the purpose of meeting a payment due out of the Fund; and
(b) the borrowed money has been paid into the Fund; and
(c) the payment due out of the Fund has not yet been made; then, for the purposes of Division 4, the amount in the Fund is taken to be reduced by the amount of the borrowed money.
"930C.(1) This section applies where money borrowed by SEGC under subsection 930A(1) is not paid to SEGC but is payable to other persons at the direction of SEGC.
"(2) SEGC must not direct that any of the money be paid to a person unless the payment is of a kind that can, under section 932, be made out of the Fund.".
Insert:
"(ba) money payable to a person or partnership under section 972A;".
Insert:
"(da) to the extent that the money referred to in section 935 is insufficient for the purpose, payments of principal, interest and other amounts payable by SEGC in respect of money borrowed, and security given, under section 930A;".
After "Division 6" insert ", 6A, 6B, 6C".
Add at the end:
"; and (c) principal, interest and other amounts payable by SEGC in respect of money borrowed, and security given, under section 930A.".
Add at the end:
"; or (iii) in the case of a guaranteed securities loan—the borrower;".
Omit the definition.
Insert:
"
(a) a sale or purchase of securities by a person or partnership where, as at the time when the agreement for the sale or purchase is made:
(i) the sale or purchase is a reportable transaction as defined in subsection 920(1); and
(ii) the person or partnership is a member organisation of a participating exchange and carries on a securities business in this jurisdiction; or
(b) a guaranteed securities loan where, as at the time when the loan is entered into, the borrower carries on a securities business in this jurisdiction.".
Omit "reportable", substitute "leviable".
Insert:
"948A. If:
(a) under an agreement for the sale or purchase of securities, or under a replacement agreement in relation to such an agreement that has been novated, a person or partnership is obliged to transfer securities of a particular kind and number to another person or partnership; and
(b) for the purpose of discharging the obligation, the first-mentioned person or partnership:
(i) elects, in accordance with the transfer delivery service provisions of a participating exchange, to bring about a transfer of securities of that kind and number to the other person or partnership by the means provided for in those provisions; and
(ii) for the purpose of so bringing about that transfer, transfers securities of that kind and number to the TDS nominee;
then, for the purposes of the application of this Division in relation to the sale or purchase, the obligation of the first-mentioned person or partnership to supply settlement documents in relation to the sale or purchase is taken to be discharged by the transfer of securities to the TDS nominee.".
Omit "Exchange subsidiary", substitute "Exchange body".
Omit "that subsidiary" (wherever occurring), substitute "that body".
After "a dealer" insert "who is a member organisation of the Exchange".
Add at the end:
"(7) In this section:
Insert:
"(1A) A dealer may make a single claim under this section in respect of 2 or more purchases.
"(1B) A claim made under subsection (1A) is to be treated for the purposes of subsection (2) as if it consisted of a separate claim in respect of each of the purchases to which it relates.".
Insert:
"950A.(1) Where:
(a) a dealer (in this section called the 'buyer') agrees to buy securities from another dealer (in this section called the 'seller'); and
(b) the purchase is a reportable transaction; and
(c) the agreement for the purchase is novated; and
(d) under a replacement agreement, the seller becomes obliged to transfer securities to the buyer;
this section has effect for the purposes of:
(e) making a claim under section 950 in respect of the purchase; and
(f) the application of this Part (other than section 980) in relation to such a claim.
"(2) Subject to subsections (3) and (4), the novation is to be disregarded.
"(3) If:
(a) the buyer's obligation to supply to the seller, under the agreement for the purchase, the consideration for the purchase is replaced by an obligation under a replacement agreement to pay an amount; and
(b) that obligation under the replacement agreement has been, or is to be, taken into account for the purposes of provisions of the business rules of a participating exchange that are of the kind referred to in subsection 954N(1);
the buyer is taken to have so supplied the consideration for the purchase.
"(4) If the replacement agreement or agreements is or are discharged or otherwise terminated, the agreement for the purchase is taken to be discharged or otherwise terminated.".
Omit all the words after paragraph (c), substitute:
"SEGC must satisfy the claim by paying to the claimant the amount that, when the claimant became entitled to make the claim, was the amount of the actual pecuniary loss suffered by the claimant in respect of the purchase.".
Insert:
"
"954A.(1) In this Division:
(a) if the business rules of the lender as in force when the loan is made prescribe a period in relation to the obligation for the purposes of this paragraph—that period; or
(b) otherwise—a period that is reasonable having regard to the obligation and all the circumstances relating to the loan;
(a) property (other than securities) or money transferred or paid to a person because the person is or was the holder of a security; or
(b) a right that a person has because the person is or was the holder of a security, including, for example:
(i) a right to be paid an amount or to be issued with additional securities; or
(ii) a right that arises out of a reduction of share capital, a scheme of arrangement or compromise or a takeover.
"(2) A reference in the definition of 'security benefit' in subsection (1) to a right is a reference to a right, whether existing or future, and whether contingent or not.
"954B.(1) For the purposes of this Part, an agreement is a guaranteed securities loan if:
(a) under the agreement:
(i) a participating exchange is to transfer securities of a
specified kind and number to, or as directed by, a person or partnership; and
(ii) in order to put the participating exchange in the same position (as nearly as practicable) as if the agreement had not been made, the person or partnership is later to transfer to, or as directed by, the participating exchange such securities and security benefits as the agreement requires; and
(b) the person or partnership is a member organisation of the participating exchange on the day when the agreement is entered into; and
(c) the agreement is entered into after the commencement of this section; and
(d) the agreement is of a kind that, according to the business rules of the participating exchange, is to be guaranteed under this Division.
"(2) For the purposes of the application of this Part in relation to a guaranteed securities loan:
(a) the participating exchange referred to in subparagraph (1)(a)(i) is the
lender ; and(b) the person or partnership referred to in subparagraph (1)(a)(i) is the
borrower ; and(c) the securities transferred as mentioned in subparagraph (1)(a)(i) are
borrowed securities .
"(3) The fact that an agreement includes obligations in addition to those mentioned in subsection (1) does not prevent the agreement from being a guaranteed securities loan.
"954C. If:
(a) under a guaranteed securities loan, or under a replacement agreement in relation to a guaranteed securities loan that has been novated, a person or partnership is obliged to transfer securities of a particular kind to, or as directed by, another person or partnership; and
(b) for the purpose of wholly or partly discharging the obligation, the first-mentioned person or partnership:
(i) elects, in accordance with the transfer delivery service provisions of a participating exchange, to bring about a transfer of a particular number of securities of that kind to, or as directed by, the other person or partnership by the means provided for in those provisions; and
(ii) for the purpose of so bringing about that transfer, transfers that number of securities of that kind to the TDS nominee;
then, for the purposes of the application of this Division in relation to the guaranteed securities loan, the obligations of the first-mentioned person or partnership to transfer securities under the loan are taken to be discharged, to the extent of that number of securities of that kind, by the transfer of securities to the TDS nominee.
"954D.(1) If, as at the end of the compliance period in relation to an obligation of the borrower under a guaranteed securities loan to transfer or pay securities or security benefits, or to pay some other amount (except an excluded amount):
(a) the lender has transferred borrowed securities in accordance with the agreement; and
(b) the obligation remains undischarged to any extent;
the lender may, subject to section 954J, make a claim in respect of the obligation.
"(2) A participating exchange may make a single claim under this section in respect of a number of obligations, whether arising under the same or different guaranteed securities loans.
"(3) A claim made under subsection (2) is to be treated for the purposes of sections 954G and 954H as if it were a separate claim in respect of each of the obligations to which it relates.
"954E.(1) Where:
(a) an agreement is novated; and
(b) before the novation, the agreement was a guaranteed securities loan;
this section has effect for the purposes of:
(c) making a claim under section 954D in respect of the loan; and
(d) the application of this Part (other than section 980) in relation to such a claim.
"(2) Subject to subsections (3) and (4), the novation is to be disregarded.
"(3) If:
(a) an obligation under the loan to pay an amount is replaced by an obligation under a replacement agreement to pay an amount; and
(b) that obligation under the replacement agreement has been, or is to be, taken into account for the purposes of provisions of the business rules of a participating exchange that are of the kind referred to in subsection 954N(1);
the obligation to pay that amount under the loan is taken to be discharged.
"(4) If the replacement agreement or agreements is or are discharged or otherwise terminated, the loan agreement is taken to be discharged or otherwise terminated.
"954F.(1) A claim must be in writing and must be served on SEGC within 6 months after the day when the claimant became entitled to make the claim.
"(2) A claim that is not made within the period required by subsection (1) is barred unless the Board otherwise determines.
"954G.(1) Subject to section 954K, SEGC must allow a claim in respect of an obligation under a guaranteed securities loan to transfer securities or security benefits (other than money) if the Board is satisfied that:
(a) the claimant is entitled to make the claim; and
(b) the obligation is still undischarged to the extent of a particular number of securities or security benefits of a particular kind (in this section called the '
outstanding items' ).
"(2) Subject to subsection (3), if:
(a) SEGC allows the claim; and
(b) the claimant has:
(i) under the guaranteed securities loan, paid as directed by the borrower; or
(ii) for the purposes of the claim, paid to SEGC;
each amount (if any) required to be paid under the loan by the claimant upon the discharge of the obligation;
SEGC must transfer to, or as directed by, the claimant, securities or security benefits of the same kind and number as the outstanding items.
"(3) If:
(a) SEGC allows the claim; and
(b) either:
(i) paragraph (2)(b) is not satisfied; or
(ii) paragraph (2)(b) is satisfied but the Board is satisfied that it is not reasonably practicable for SEGC to obtain securities or security benefits of the same kind and number as the outstanding items within the pre-cash settlement period;
SEGC must satisfy the claim by paying to the claimant the amount that, as at the time when the Board decides it is so satisfied, is the actual pecuniary loss suffered by the claimant in respect of the failure to discharge the obligation.
"(4) In working out the amount of the actual pecuniary loss suffered in respect of the failure to discharge the obligation, regard may be had to the cost to the claimant of any securities or security benefits of the same kind as the outstanding items that the claimant obtained because the obligation was not discharged.
"(5) In this section:
(a) if the business rules of the claimant, as in force when the Board allows the claim, prescribe a period, for the purposes of this section, in relation to a class of claims that includes the claim— that period; or
(b) otherwise—such period as the Board, having regard to all the circumstances of the claim, considers reasonable.
"954H.(1) Subject to section 954K, SEGC must allow a claim in respect of an obligation under a guaranteed securities loan to pay a security benefit that is an amount of money, or to pay some other amount, if the Board is satisfied that:
(a) the claimant is entitled to make the claim; and
(b) the obligation is still undischarged to the extent of a particular amount (in this section called the '
outstanding amount' ).
"(2) If SEGC allows the claim, it must pay to, or as directed by, the claimant an amount equal to the outstanding amount.
"954J. A participating exchange may not make a claim in respect of a guaranteed securities loan unless:
(a) the borrower was carrying on a securities business in this jurisdiction on the day when the loan was entered into; or
(b) if the borrower was not so carrying on such a business and was not carrying on a securities business in any other jurisdiction on that day—the last securities business that the borrower
carried on in a jurisdiction before that day was carried on in this jurisdiction.
"954K. If SEGC allows a claim under section 954D of the Corporations Law of another jurisdiction in respect of a failure to discharge an obligation, SEGC must not allow a claim under section 954D of the Corporations Law of this jurisdiction in respect of the same failure.
"
"954L. In this Division:
'
"954M. If:
(a) a person or partnership (in this section called the '
transferor' ) is, under provisions of a kind referred to in subsection 954P(1), obliged to transfer securities of a particular kind to another person or partnership (in this section called the 'transferee' ); and(b) for the purpose of wholly or partly discharging the obligation, the transferor:
(i) elects, in accordance with the transfer delivery service provisions of a participating exchange, to bring about a transfer of a particular number of securities of that kind to the transferee by the means provided for in those provisions; and
(ii) for the purpose of so bringing about the transfer, transfers that number of securities of that kind to the TDS nominee;
then, for the purposes of the application of this Division, the obligation is taken to have been discharged, to the extent of that number of securities of that kind, by the transfer of securities to the TDS nominee.
"954N.(1) If:
(a) under provisions of the business rules of a participating exchange, the total of the amounts that become due and payable to a dealer by a subsidiary of the participating exchange on a
particular day in respect of transactions (as denned in the business rules) of a kind or kinds specified in the business rules is set off against the total of the amounts that become due and payable by the dealer to the subsidiary on that day in respect of transactions (as so defined) of that kind or those kinds; and
(b) depending on which of those totals is the greater, the provisions oblige:
(i) the dealer to pay to the subsidiary, or to some other dealer or dealers nominated under the provisions; or
(ii) the subsidiary, or some other dealer or dealers nominated under the provisions, to pay to the dealer;
within a specified period, the difference between those totals; and
(c) as at the end of that period, that obligation remains undischarged to the extent of a particular amount;
the person or partnership to which the amount is payable may, subject to section 954U, make a claim in respect of the obligation.
"(2) Entitlement to make the claim is not affected by a dealer ceasing to be a member organisation of the participating exchange after the obligation arose.
"(3) For the purposes of this section, a total may be a nil amount.
"954P.(1) This section applies if:
(a) under provisions of the business rules of a participating exchange, the total number of securities of a particular kind to be transferred on a particular day to a dealer by a subsidiary of the participating exchange in respect of transactions (as defined in the business rules) of a kind or kinds specified in the business rules is set off against the total number of securities of that kind to be transferred on that day by the dealer to the subsidiary in respect of transactions (as so defined) of that kind or those kinds; and
(b) depending on which of those totals is the greater, the provisions oblige:
(i) the dealer to transfer to some other dealer or dealers nominated under the provisions; or
(ii) some other dealer or dealers nominated under the provisions to transfer to the dealer;
within a specified period, securities of that kind equal in number to the difference between those totals; and
(c) as at the end of that period, the obligation to transfer, or any of the obligations to transfer, as the case requires, remains undischarged to the extent of a particular number of securities of that kind (in this section called the 'default securities').
"(2) If the participating exchange has not taken action as mentioned in subsection (3), the person or partnership to which the default securities should have been transferred may, subject to section 954U, make a claim in respect of the failure to transfer the default securities.
"(3) If, for the purpose of remedying the failure to transfer the default securities, the participating exchange has transferred securities of the same kind and number as the default securities to the person or partnership to which the default securities should have been transferred:
(a) the participating exchange is subrogated to all the rights and remedies of the person or partnership in relation to the failure to transfer the default securities; and
(b) the participating exchange may, subject to section 954U, make a claim in respect of its actions to remedy the failure; and
(c) any claim made under subsection (2) in respect of the failure is taken not to have been entitled to be made.
"(4) Entitlement to make a claim is not affected by a dealer ceasing to be a member organisation of the participating exchange after the obligation to transfer arose.
"(5) For the purposes of this section, a total number of marketable securities of a particular kind may be zero.
"954Q.(1) A claim must be in writing and must be served on SEGC within 6 months after the day on which the claimant became entitled to make the claim.
"(2) A claim that is not made within the period required by subsection (1) is barred unless the Board otherwise determines.
"954R.(1) Subject to section 954V, SEGC must allow a claim under subsection 954N(1) if the Board is satisfied that:
(a) the claimant is entitled to make the claim; and
(b) the obligation referred to in paragraph 954N(1)(c) still remains undischarged to the extent of a particular amount.
"(2) If SEGC allows the claim, SEGC must pay to the claimant the amount referred to in paragraph (1)(b).
"954S.(1) Subject to section 954V, SEGC must allow a claim under subsection 954P(2) if the Board is satisfied that:
(a) the claimant is entitled to make the claim; and
(b) the obligation referred to in paragraph 954P(1)(c) still remains undischarged to the extent of a particular number of securities of a particular kind (in this section called the '
outstanding securities' ).
"(2) Subject to subsection (3), if SEGC allows the claim, it must transfer to the claimant securities of the same kind and number as the outstanding securities.
"(3) If the Board is satisfied that it is not reasonably practicable for SEGC to obtain securities of the same kind and number as the outstanding securities within the pre-cash settlement period, SEGC must satisfy the claim by paying to the claimant the amount that, as at the time when the Board decides it is so satisfied, is the actual pecuniary loss suffered by the claimant in respect of the failure to transfer the outstanding securities.
"(4) In working out the amount of the actual pecuniary loss suffered in respect of the failure to transfer the outstanding securities, regard may be had to the cost to the claimant of any securities of the same kind as the outstanding securities that the claimant obtained because the outstanding securities were not transferred.
"(5) In this section:
(a) if the business rules of the participating exchange that is referred to in paragraph 954P(1)(a), as in force when the Board allows the claim, prescribe a period, for the purposes of this section, in relation to a class of claims that includes the claim—that period; or
(b) otherwise—such period as the Board, having regard to all the circumstances of the claim, considers reasonable.
"954T.(1) Subject to section 954V, SEGC must allow a claim by a participating exchange under subsection 954P(3) if the Board is satisfied that:
(a) the participating exchange is entitled to make the claim; and
(b) the participating exchange has paid or transferred to SEGC any money or property it has obtained because of the right of subrogation given by paragraph 954P(3)(a) in relation to the failure to transfer the default securities.
"(2) If SEGC allows the claim, it must pay to the participating exchange the amount that, as at the time when the claim is allowed, is the actual pecuniary loss suffered by the participating exchange because of the actions it has taken to remedy its subsidiary's default.
"(3) In working out the amount of the actual pecuniary loss suffered in respect of the actions taken by the participating exchange to remedy its subsidiary's default, regard may be had to the cost to the participating exchange of obtaining the securities transferred as mentioned in subsection 954P(3).
"(4) Money or property paid or transferred to SEGC under paragraph (1)(b) forms part of the Fund.
"954U. A person or partnership may not make a claim in respect of a failure by a person or partnership (in this section called the
(a) the defaulter was carrying on a securities business in this jurisdiction on the day on which the obligation arose; or
(b) if the defaulter was not so carrying on such a business and was not carrying on a securities business in any other jurisdiction on that day—the last securities business that the defaulter carried on in a jurisdiction before that day was carried on in this jurisdiction.
"954V.(1) If SEGC allows a claim under subsection 954N(1) of the Corporations Law of another jurisdiction in respect of a failure to pay an amount, SEGC must not allow a claim under the corresponding subsection of the Corporations Law of this jurisdiction that relates to the same failure.
"(2) If SEGC allows a claim under section 954P of the Corporations Law of this or another jurisdiction in respect of a failure to transfer securities, SEGC must not allow a claim, or another claim, as the case requires, under section 954P of the Corporations Law of this jurisdiction that relates to the same failure.
"954W. In this Division:
(a) an obligation to transfer securities under an agreement for the purchase of securities, where the purchase is, for the purposes of Division 6, a reportable transaction; or
(b) an obligation to transfer securities under a replacement agreement in relation to an agreement of the kind referred to in paragraph (a) that has been novated; or
(c) an obligation to transfer securities under a guaranteed securities loan; or
(d) an obligation to transfer securities under a replacement agreement in relation to a guaranteed securities loan that has been novated; or
(e) an obligation to transfer securities that arose as mentioned in paragraph 954P(1)(b);
(a) except in the case of a purchase obligation—discharge the whole or a part of the obligation; or
(b) in the case of a purchase obligation—discharge the whole of the obligation;
"954X.(1) This section applies if:
(a) a person or partnership (in this Division called the '
transferor' ) is obliged to transfer securities of a particular kind to, or as directed by, another person or partnership (in this Division called the 'transferee' ); and(b) the obligation is a claimable obligation; and
(c) for the purpose of discharging the obligation, the transferor:
(i) elects, in accordance with the transfer delivery service provisions of a participating exchange, to bring about a transfer of a particular number of securities of that kind to, or as directed by, the transferee by the means provided for in those provisions; and
(ii) for the purpose of so bringing about the transfer, transfers that number of securities of that kind to the TDS nominee; and
(d) for the purpose of bringing about the transfer of securities referred to in subparagraph (c)(i) by the means provided for in those provisions, the TDS nominee later purports to transfer that number of securities of that kind to, or as directed by, the transferee; and
(e) the TDS nominee is in default under the transfer delivery
service provisions because the transfer documents in relation to the purported transfer, so far as they relate to a particular number of securities of that kind (in this Division called the
'default securities' ), are not sufficient for the purpose referred to in subsection 924(2); and(f) if the obligation is a purchase obligation—the transferee has paid, or is ready, willing and able to pay, to the transferor, under the agreement for the purchase, the consideration for the purchase.
"(2) If the participating exchange has not taken action as mentioned in paragraph (3)(a) or (b), the transferee (even if it is the participating exchange) may, subject to section 954ZB, make a claim in respect of the TDS nominee's default.
"(3) If the participating exchange has, for the purpose of remedying the TDS nominee's default:
(a) where the participating exchange is also the transferee—obtained marketable securities of the same kind and number as the default securities; or
(b) otherwise—transferred securities of the same kind and number as the default securities to, or as directed by, the transferee;
the following provisions have effect:
(c) unless the participating exchange is also the transferee—the participating exchange is subrogated to all the rights and remedies of the transferee in relation to the purported transfer of securities by the TDS nominee;
(d) the participating exchange may, subject to section 954ZB, make a claim in respect of its actions to remedy the default;
(e) any claim made under subsection (2) in respect of the TDS nominee's default is taken not to have been entitled to be made.
"(4) A person or partnership may make a single claim under subsection (2) or (3) in respect of 2 or more defaults.
"(5) A claim made under subsection (4) is to be treated for the purposes of sections 954Z and 954ZA as if it were a separate claim in respect of each of the defaults to which it relates.
"(6) Entitlement to make a claim in respect of a claimable obligation is not affected by a person or partnership ceasing after the obligation arose to be a member organisation of a participating exchange.
"954Y.(1) A claim must be in writing and must be served on SEGC within 6 months after the day on which the claimant became entitled to make the claim.
"(2) A claim that is not made within the period required by subsection (1) is barred unless the Board otherwise determines.
"954Z.(1) Subject to section 954ZC, SEGC must allow a claim under subsection 954X(2) if the Board is satisfied that:
(a) the claimant is entitled to make the claim; and
(b) if paragraph 954X(1)(f) applies—the claimant has:
(i) paid to the transferor; or
(ii) for the purposes of the claim, paid to SEGC;
the consideration, under the agreement for the purchase, for the purchase.
"(2) Subject to subsection (3), if SEGC allows the claim, it must transfer to, or as directed by, the claimant securities of the same kind and number as the default securities.
"(3) If the Board is satisfied that it is not reasonably practicable for SEGC to obtain securities of the same kind and number as the default securities within the pre-cash settlement period, SEGC must satisfy the claim by paying to the claimant the amount that, as at the time when the Board decides that it is so satisfied, is the actual pecuniary loss suffered by the claimant in respect of the TDS nominee's default.
"(4) In working out the amount of the actual pecuniary loss suffered in respect of the TDS nominee's default, regard may be had to the cost to the claimant of any securities of the same kind as the default securities that the claimant obtained because the TDS nominee failed to transfer the default securities.
"(5) In this section:
(a) if the business rules of the participating exchange concerned, as in force when the Board allows the claim, prescribe a period, for the purposes of this section, in relation to a class of claims that includes the claim—that period; or
(b) otherwise—such period as the Board, having regard to all the circumstances of the claim, considers reasonable.
"954ZA.(1) Subject to section 954ZD, SEGC must allow a claim under subsection 954X(3) if the Board is satisfied that:
(a) the claimant is entitled to make the claim; and
(b) if paragraph 954X(1)(f) applies—the transferee has paid to the transferor the consideration payable, under the agreement for the purchase, for the purchase; and
(c) the claimant has paid or transferred to SEGC any money or property it has obtained because of the right of subrogation given by paragraph 954X(3)(c) in relation to the purported transfer of securities by the TDS nominee.
"(2) If SEGC allows the claim, it must pay to the claimant the amount that, as at the time when the claim is allowed, is the actual pecuniary loss suffered by the claimant because of the actions it has taken to remedy the TDS nominee's default.
"(3) In working out the amount of the actual pecuniary loss suffered in respect of actions taken by the claimant to remedy the TDS nominee's default, regard may be had to the cost to the claimant of obtaining the securities obtained or transferred as mentioned in paragraph 954X(3)(a) or (b), as the case requires.
"(4) Money or property paid or transferred to SEGC under paragraph (1)(c) forms part of the Fund.
"954ZB. A person or partnership may not make a claim under subsection 954X(2) or (3) unless:
(a) in the case of the participating exchange referred to in that subsection—the participating exchange was carrying on business in this jurisdiction on the day of the purported transfer referred to in paragraph 954X(1)(d); or
(b) otherwise:
(i) the person or partnership was carrying on a securities business in this jurisdiction on the day of the purported transfer referred to in paragraph 954X(1)(d); or
(ii) if the person or partnership was not so carrying on such a business and was not carrying on a securities business in any other jurisdiction on that day—the last securities business that the person or partnership carried on in a jurisdiction before that day was carried on in this jurisdiction.
"954ZC. If SEGC allows a claim under section 954X of the Corporations Law of this or another jurisdiction in respect of a purported transfer of securities, SEGC must not allow, under section 954X of the Corporations Law of this jurisdiction, a claim, or another claim, as the case requires that relates to the same purported transfer.".
Repeal the section, substitute:
"959.(1) A claim must:
(a) be in writing; and
(b) be served on SEGC:
(i) if a notice under subsection (4) applies to the claim— before the end of the last application day specified in the notice; or
(ii) in any other case—within 6 months after the day on which the claimant first became aware that the claimant had suffered loss as a result of the unauthorised execution.
"(2) For the purposes of subsection (1), a notice under subsection (4) applies to a claim if the claim is in respect of an unauthorised execution, by the dealer named in the notice, during the applicable period specified in the notice.
"(3) A claim that is not served on SEGC by the time required by paragraph (1)(b) is barred unless the Board otherwise determines.
"(4) SEGC may publish, in each State and Territory in a daily newspaper circulating in that State or Territory, a notice that:
(a) is in the prescribed form; and
(b) names a particular dealer; and
(c) requires that all claims in respect of unauthorised executions, by the named dealer, during a period (in this section called the
'applicable period' ) specified in the notice in accordance with subsection (5) must be served on SEGC before the day (in this section called the'last application day' ) specified in the notice in accordance with subsection (6).
"(5) The applicable period must be a period that starts and ends before:
(a) if each publication of the notice occurs on the same day—the day on which the notice is published; or
(b) in any other case—the first day on which the notice is published.
"(6) The last application day must be at least 3 months after:
(a) if each publication of the notice occurs on the same day—the day on which the notice is published; or
(b) in any other case—the last day on which the notice is published.
"(7) SEGC, a member of the Board and any employee of, or person acting on behalf of, SEGC each have qualified privilege in respect of the publication of a notice under subsection (4).".
(a) After "such a business" insert "and was not carrying on a securities business in any other jurisdiction on that day".
(b) After "carried on" insert "in a jurisdiction".
(a) After "such a business" insert "and was not carrying on a securities business in any other jurisdiction on that day".
(b) After "carried on" insert "in a jurisdiction".
Omit the heading, substitute:
"
Insert:
"970A. If:
(a) a person (in this section called the
'claimant' ) has made a claim in respect of a liability of another person (in this section called the'defaulter' ); and(b) the claimant has a right, whether under an agreement or otherwise, to set off a liability of the claimant to the defaulter against the liability referred to in paragraph (a);
SEGC may refuse to allow the claim until the claimant has exercised the right.
"970B.(1) If:
(a) SEGC allows a claim by a person (in this section called the
'claimant' ) in respect of a liability of another person (in this section called the 'defaulter' ); and(b) the liability of the defaulter to the claimant has been reduced, by an amount of money or a number of securities (in this section called the '
set-off reduction' ), because of:(i) the exercise by the claimant or the defaulter of a right of set-off, whether under an agreement or otherwise; or
(ii) the operation of an agreement so far as it provides for the automatic set-off of liabilities; and
(c) but for this section, the reduction of the defaulter's liability
would not be taken into account when working out the obligations of SEGC in respect of the claim;
this section applies for the purposes of working out those obligations.
"(2) If:
(a) SEGC is required to satisfy the claim by paying an amount; and
(b) the set-off reduction consists of an amount;
the amount SEGC must pay in respect of the claim is reduced by the amount of the set-off reduction.
"(3) If:
(a) SEGC is required to satisfy the claim by paying an amount; and
(b) the set-off reduction consists of a number of securities; then:
(c) the Board must work out the value of the securities; and
(d) the amount SEGC must pay in respect of the claim is reduced by the value worked out under paragraph (c).
"(4) If:
(a) SEGC is required to satisfy the claim by transferring securities of a particular kind; and
(b) the set-off reduction consists of a number of securities of that kind;
the number of securities that SEGC must transfer in respect of the claim is reduced by the number referred to in paragraph (b).
"(5) If:
(a) SEGC is required to satisfy the claim by transferring securities of a particular kind; and
(b) the set-off reduction consists of a number of securities that are not of that kind;
then:
(c) the Board must work out:
(i) the value of the securities that constitute the set-off reduction; and
(ii) the number of securities of the kind referred to in paragraph (a) that are equal in value to the value worked out under subparagraph (i); and
(d) the number of securities that SEGC is required to transfer in respect of the claim is reduced by the number worked out under subparagraph (c)(ii).
"(6) If:
(a) SEGC is required to satisfy the claim by transferring securities of a particular kind; and
(b) the set-off reduction consists of an amount of money; then:
(c) the Board must work out the number of securities of that kind that are equal in value to that amount; and
(d) the number of securities that SEGC must transfer in respect of the claim is reduced by the number worked out under paragraph (c).".
Omit "prescribed", substitute "determined in writing by the Board".
Insert:
"(1A) A rate of interest determined by the Board for the purposes of subsection (1):
(a) must not exceed the rate that, when the determination is made, is fixed by Rules of Court for the purposes of paragraph 52(2)(a) of the
Federal Court of Australia Act 1976 ; and(b) must not be less than 5% per year.
"(1B) As soon as practicable after determining a rate of interest for the purposes of subsection (1), the Board must cause a copy of the determination to be published in the
Insert:
"972A.(1) If the Board is satisfied that:
(a) a person or partnership (in this section called the '
defaulter' ) has failed to discharge an obligation to transfer securities to another person or partnership (in this section called the 'entitled entity' ); and(b) the entitled entity:
(i) has made a claim under Division 6, 6A, 6B or 6C in respect of the failure and has had securities transferred to it, or an amount paid to it, in satisfaction of the claim; or
(ii) unless it is a participating exchange—would have been
entitled to make a claim under Division 6B or 6C in respect of the failure if a participating exchange had not transferred securities to it for the purpose of remedying the failure; or
(iii) if it is a participating exchange—would have been entitled to make a claim under Division 6C in respect of the failure if it had not obtained securities for the purpose of remedying the failure; and
(c) if the defaulter had duly transferred securities in accordance with the obligation, an amount would have been paid, or property would have been transferred, to the entitled entity as the holder of the securities; and
(d) the entitled entity has not received, and is not entitled to receive (otherwise than from the defaulter):
(i) the amount or property; or
(ii) an equivalent amount or equivalent property in respect of securities transferred or obtained as mentioned in paragraph (b); and
(e) if subparagraph (b)(i) applies and an amount has been paid in satisfaction of the claim—the amount paid does not adequately compensate the entitled entity for the loss of the amount or property referred to in paragraph (c);
the Board may determine in writing that there be paid to the entitled entity, in respect of the loss of the amount or property referred to in paragraph (c), a specified amount that the Board considers to be fair and reasonable in all the circumstances.
"(2) If a determination is made under subsection (1), SEGC must pay to the entitled entity the amount specified in it.".
Omit "or 952(3)", substitute ", 952(3), 954G(2), 954S(2) or 954Z(2)".
Omit the subsection, substitute:
"(3) If:
(a) SEGC buys securities for the purpose of complying, in relation to a claim, with a provision referred to in paragraph (1)(a); and
(b) SEGC satisfies the claim by paying an amount to the claimant;
SEGC must, as soon as practicable after satisfying the claim, sell the securities and pay the proceeds of the sale into the Fund.
"(4) In this section:
Omit the paragraph, substitute:
"(a) a cash settlement provision requires SEGC to pay an amount in respect of a claim; and".
Omit "person", substitute "claimant".
Insert:
"(1A) Where:
(a) in relation to a claim, paragraph 970B(3)(c), (5)(c) or (6)(c) requires the Board to work out the value of securities, or the number of securities that are equal in value to some other value or amount; and
(b) the value or number cannot be determined by agreement between the Board and the claimant;
the value or number is to be determined by arbitration in accordance with this section.".
Add at the end:
"(7) In this section:
Insert:
"(1A) The Board may, for the purposes of section 970A or 970B, by notice in writing served on a person, require the person to give SEGC specified information relating to the existence or exercise of rights of set-off.".
After "(1)" insert "or (1A)".
Insert:
"(1A) Where SEGC allows a claim under section 950 in respect of a purchase the agreement for which has been novated, SEGC is subrogated to all the rights and remedies of the claimant in relation to the replacement agreement or agreements.
"(1B) Where SEGC allows a claim under Division 6A in respect of an obligation under a guaranteed securities loan, SEGC is subrogated to all the claimant's rights and remedies in relation to that obligation.
"(1C) Where SEGC allows a claim under section 954D in respect of an obligation under a guaranteed securities loan that has been novated, SEGC is subrogated to all the claimant's rights and remedies in relation to the obligation, under a replacement agreement, that replaced the first-mentioned obligation.
"(1D) Where SEGC allows a claim under subsection 954N(1) or 954P(2) in respect of an obligation to pay an amount or to transfer securities, SEGC is subrogated to all the claimant's rights and remedies in relation to that obligation.
"(1E) Where SEGC allows a claim under subsection 954P(3) in respect of a failure to transfer securities, SEGC is subrogated to all the rights and remedies that the claimant has in relation to that failure because of the subrogation effected by paragraph 954P(3)(a).
"(1F) Where SEGC allows a claim under subsection 954Y(2) in respect of a purported transfer of securities, SEGC is subrogated to all the claimant's rights and remedies in relation to that purported transfer.
"(1G) Where SEGC allows a claim under subsection 954Y(3) in respect of a purported transfer of securities, SEGC is subrogated to:
(a) if the claimant is also the transferee referred to in that subsection—all the claimant's rights and remedies in relation to that purported transfer; or
(b) otherwise—all thè rights and remedies that the claimant has in relation to that purported transfer because of the subrogation effected by paragraph 954Y(3)(c).".
Omit all the words after "account", substitute "of the person as required by this Chapter or a corresponding previous law; or".
Omit all the words after "specified bank accounts", substitute "that the person holds or maintains (whether in Australia or elsewhere), subject to such terms and conditions as the Court imposes".
Section 10
COMMENCEMENT AND APPLICATION OF CHANGES TO THE CORPORATIONS LAW RESULTING FROM THIS ACT
Omit the paragraph.
Add at the end:
"1368.(1) The following provisions of this Law, as in force after the commencement of section 5 of the
(a) the definition of 'property' in subsection 920(1);
(b) subsection 927(5A);
(c) paragraph 961A(b);
(d) paragraph 966A(b).
"(2) The following provisions of this Law, as in force after the commencement of section 6 of the
(a) subparagraph 1069(1)(e)(iii);
(b) paragraph 1069(1)(f).
"(3) The following provisions of this Law, as in force immediately after the commencement of section 8 of the
(a) paragraphs (b) and (ba) of the definition of 'company' in section 9;
(b) subsection 261(1);
(c) subsections 265(4), (5), (6) and (9);
(d) subsections 272(1) and (3);
(e) subsections 273(1) and (4);
(f) subsections 275(2) and (4);
(g) sections 275A, 276, 276AA and 276A.
"(4) The following provisions of this Law, as in force after the commencement of section 9 of the
(a) paragraph (a) of the definition of 'clients' segregated account' in section 9;
(b) section 369;
(c) paragraph 874(1)(b);
(d) paragraph 1224(1)(c).
"1369.(1) In relation to a claim under Division 7 of Part 7.10 in respect of a loss that a person became aware of before the commencement of section 5 of the
(a) section 959 of this Law, as in force after that commencement, does not apply; and
(b) section 959 of this Law, as in force before that commencement, continues to apply.
"(2) In relation to a prospectus issued before the commencement of section 6 of the
(a) the following Division and sections of this Law, as in force after that commencement, do not apply:
(i) Division 4 of Part 7.11;
(ii) section 1029;
(iii) section 1029A;
(iv) section 1031;
(v) section 1040;
(vi) section 1041; and
(b) the following Division and sections of this Law as in force before that commencement continue to apply:
(i) Division 4 of Part 7.11;
(ii) section 1029;
(iii) section 1031;
(iv) section 1040;
(v) section 1041.".
1. No. 109, 1989, as amended. For previous amendments, see No. 110, 1990; and No. 110, 1991.
2. No. 110, 1990.
3. No. 192, 1985.
4. No. 92, 1989.
1. On the commencement of section 5 of this Act, the headings to sections 938 and 939 of the Corporations Law set out in section 82 of the
Corporations Act 1989 are altered by omitting "reportable ".2. On the commencement of section 6 of this Act, headings to sections of the Corporations Law set out in section 82 of the
Corporations Act 1989 are altered as follows:(a) the heading to section 1008 is omitted and the following heading is substituted:
"
(b) the heading to section 1009 is altered by adding at the end "
, auditors etc. ";(c) the heading to section 1023 is altered by inserting "
primary " before "prospectuses ";(d) the heading to section 1029 is omitted and the following heading is substituted:
"
Primary prospectuses—documents to be kept ";(e) the heading to section 1038 is altered by inserting "
primary " before "prospectus ";(f) the heading to section 1040 is altered by omitting "
or issued " and substituting ",issued or sold ";(g) the heading to section 1041 is altered by omitting "
or issue " and substituting ", issue or sale ".3. On the commencement of section 7 of this Act, the heading to section 362 of the Corporations Law set out in section 82 of the
Corporations Act 1989 is
altered by omitting "
4. On the commencement of section 9 of this Act, headings to sections of the Corporations Law set out in section 82 of the
Corporations Act 1989 are altered as follows:(a) the headings to sections 150 and 151 are altered by omitting "
or 3 " and substituting ",3 or 4 ";(b) the heading to section 323 is altered by inserting "
or 4" after "3 ";(c) the heading to section 1113 is altered by omitting "
Powers " and substituting "General powers ".
[
House of Representatives on 7 November 1991
Senate on 13 November 1991
0
0
0