Corporations Regulations (Amendment) (Cth)

Statutory Rules 1994

No. 302 1

__________________

Corporations Regulations 2(Amendment)

I, The Governor-General of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, make the following Regulations under the Corporations Act 1989.

Dated 30 August 1994.

BILL HAYDEN

Governor-General

By His Excellency’s Command,

M. LAVARCH

Attorney-General

____________

1. Amendment

1.1 The Corporations Regulations are amended as set out in these Regulations.

[NOTE: These Regulations commence on gazettal: see Acts Interpretation Act 1901, s. 48.]

2. New Part heading

2.1 After the heading to Chapter 1, insert:

“PART 1.0—MISCELLANEOUS”

3. New regulations 1.07A, 1.07B and 1.07C

3.1 After regulation 1.07, insert:

Information to accompany accounts etc. to be lodged by disclosing entities

1.07A. A document lodged under section 317A or 323K of the Corporations Law (including a document that, because of section 323A of the Law, is lodged under section 317A) in relation to a half-year must be accompanied by Form 1001 setting out the following information:

(a)
if the disclosing entity is a company:
(i)
the company’s Australian Company Number; and
(ii)
the dates on which the half-year to which the document relates begins and ends; and
(iii)
a statement of certification in accordance with regulation 1.12; or
(b)
if the disclosing entity is a body (other than a company):
(i)
the body’s Australian Registered Body Number; and
(ii)
the dates on which the half-year to which the document relates begins and ends; and
(iii)
a statement of certification in accordance with regulation 1.12; or
(c)
if the disclosing entity is an undertaking to which prescribed interests or units of prescribed interests relate:
(i)
the identifying number ascribed to that undertaking by the Commission; and
(ii)
the dates on which the half-year to which the document relates begins and ends; and
(iii)
the name of the management company (or, if there is no management company, the name of the trustee or representative) and the name, if any, of the scheme or undertaking to which those prescribed interests or units relate; and
(iv)
a statement of certification in accordance with regulation 1.12.

“1.07B.

A document lodged under section 317A or 323K of the Corporations Law (including a document that, because of section 323A of the Law, is lodged under section 317A) in relation to a financial year must be accompanied by Form 1002 setting out the following information:

(a)
if the disclosing entity is a company:
(i)
the company’s Australian Company Number; and
(ii)
the dates on which the financial year to which the document relates begins and ends; and
(iii)
a statement of certification in accordance with regulation 1.12; or
(b)
if the disclosing entity is a body (other than a company):
(i)
the body’s Australian Registered Body Number; and
(ii)
the dates on which the financial year to which the document relates begins and ends; and
(iii)
a statement of certification in accordance with regulation 1.12; or
(c)
if the disclosing entity is an undertaking to which prescribed interests or units of prescribed interests relate:
(i)
the identifying number ascribed to that undertaking by the Commission; and
(ii)
the dates on which the financial year to which the document relates begins and ends; and
(iii)
the name of the management company (or, if there is no management company, the name of the trustee or representative) and the name, if any, of the scheme or undertaking to which those prescribed interests or units relate; and
(iv)
a statement of certification in accordance with regulation 1.12.

“1.07C.

A document lodged under section 1001B of the Corporations Law must be accompanied by Form 1003 setting out the following information:

(a)
if the disclosing entity is a body:
(i)
the body’s Australian Company Number or Australian Registered Body Number; and
(ii)
a statement of certification in accordance with regulation 1.12; or
(b)
if the disclosing entity is an undertaking to which prescribed interests or units of prescribed interests relate:
(i)
the identifying number ascribed to that undertaking by the Commission; and
(ii)
the name of the management company (or, if there is no management company, the name of the trustee or representative) and the name, if any, of the scheme or undertaking to which those prescribed interests or units relate; and
(iii)
a statement of certification in accordance with regulation 1.12.”.

4. New

Part 1.2.

4.1 After regulation 1.16, insert:

“PART 1.2—DISCLOSING ENTITIES

Securities declared not to be ED securities

“1.2.01.

For the purposes of section 111AJ of the Corporations Law, securities:

(a)
of a body that, under Listing Rule 1B of the listing rules of the Australian Stock Exchange Limited, is an exempt foreign company; or
(b)
that are quoted on Australian Bloodstock Exchange Limited;
are declared not to be ED securities.

Foreign companies issuing securities under foreign scrip offers etc. exempt from disclosing entity provisions

“1.2.02.

(1) For the purposes of section 111AS of the Corporations Law, a foreign company is exempt from the disclosing entity provisions in respect of ED securities under section 111AG of the Law if:

(a)
the company issues the securities in connection with a foreign takeover offer or foreign scheme of arrangement; and
(b)
the securities issued are, at the time of issue, securities in a class of securities quoted on an approved foreign exchange; and
(c)
the terms and conditions of the issue to citizens and Australian permanent residents are the same as those applying to each other person receiving securities that are in the same class; and
(d)
the same notices, documents or other information (or, where applicable, an English translation of these) (modified, if necessary, to include any additional information for the purposes of complying with Division 2 of Part 7.12 of the Corporations Law) are given to Australian citizens or permanent residents as are given to each other person; and
(e)
the notices, documents and other information are given to Australian citizens and permanent residents at the same time, or as soon as practicable after, they are given to those other persons; and
(f)
in relation to the issue—the company complies with all legislative and stock exchange requirements in the place in which is located:
(i)
the approved foreign exchange; or
(ii)
if more than one—the principal approved exchange;
on which the company’s securities are quoted.

“(2)

In this regulation:

‘approved foreign exchange’ includes:

(a)
American Stock Exchange Inc.;
(b)
New York Stock Exchange Inc.;
(c)
New Zealand Stock Exchange;
(d)
The Stock Exchange of Hong Kong Ltd;
(e)
Stock Exchange of Singapore Limited;
(f)
The Amsterdam Stock Exchange;
(g)
the Frankfurt Stock Exchange
(h)
The International Stock Exchange of the United Kingdom and the Republic of Ireland Limited;
(i)
the Milan Stock Exchange;
(j)
the NASDAQ National Market;
(k)
the Paris Bourse;
(l)
the Tokyo Stock Exchange;
(m)
the Toronto Stock Exchange;
(n)
the Zurich Stock Exchange;

‘foreign scheme of arrangement’ means a compromise or arrangement that is subject to court approval under subsection 411 (6) of the Corporations Law, between:

(a)
a foreign company and a class of its creditors; or
(b)
a foreign company and a class of its members;

‘foreign takeover offer’ means an offer made to acquire all or some of the shares of:

(a)
all holders of a class of shares in a foreign company; or
(b)
all holders other than:
(i)
the offerer; or
(ii)
the offerer and its associates (within the meaning of Division 2 of Part 1.2 of the Corporations Law).

Foreign companies issuing securities under employee share scheme exempt from the disclosing entity provisions

“1.2.03.

(1) For the purposes of section 111AS of the Corporations Law, a foreign company is exempt from the disclosing entity provisions in respect of:

(a)
offers for subscription, or invitations to subscribe for, shares in the company made to employees of the company or of an associated body corporate, under an employee share scheme, and a prospectus issued in relation to the shares that is lodged with the Commission; and
(b)
offers for purchase, or invitations to buy, shares of the company made to employees of the company or of an associated body corporate, under an employee share scheme and a secondary trading notice issued under section 1043C or 1043D of the Corporations Law.

“(2)

Subregulation (1) is not affected by any action of an employee, the result of which is that another person who is not an employee acquires an interest in a share issued under the employee share scheme.

“(3)

In this regulation:

(a)
an ‘employee share scheme’ is a scheme under which a company:
(i)
offers for subscription, or issues invitations to subscribe for, shares (or options over issued shares) in the company only to persons who are full-time or part-time employees of the company or of an associated body corporate (including directors) at the time that the offer or invitation is made; and
(ii)
offers for purchase, or issues invitations to buy, shares (or options over issued shares) in the company only to persons who are full-time or part-time employees of the company or of an associated body corporate (including directors) at the time that the offer or the invitation is made; and
(b)
a body corporate is an ‘associated body corporate’ in relation to a foreign company if:
(i)
the body corporate is related to the company within the meaning of section 50 of the Corporations Law; or
(ii)
the body corporate is entitled to at least 20% of the voting shares of the company; or
(iii)
the company is entitled to at least 20% of the voting shares of the body corporate.

Financial institutions exempt from disclosing entity provisions

“1.2.04.

(1) For the purposes of section 111AS of the Corporations Law, if a financial institution that is a disclosing entity complies with the accounting requirements of section 272 of the Financial Institutions Code, the financial institution is exempt from the requirements set out in sections 297, 298 and 299 of the Law (as applied by section 323A of the Law).

(2)

In this regulation:

‘financial institution’ means a body, or an entity, within the meaning of Part 3.6 of the Corporations Law, that is a financial institution for the purposes of a Financial Institutions Code;

‘financial institutions code’ includes:

(a)
the Financial Institutions (NSW) Code;
(b)
the Financial Institutions (Victoria) Code;
(c)
the Financial Institutions (Queensland) Code;
(d)
the Financial Institutions (Western Australia) Code;
(e)
the Financial Institutions (South Australia) Code;
(f)
the Financial Institutions (Tasmania) Code;
(g)
the Financial Institutions (ACT) Code;
(h)
the Financial Institutions (NT) Code.”.

5. New subregulation 3.6.02 (4):

5.1 After subregulation 3.6.02 (3), insert:

“(4)

Subregulation (2) does not apply to a half-year accounting period of a disclosing entity unless it is a borrowing corporation.”.

6. New regulation 3.6.02A

6.1 After regulation, 3.6.02, insert:

Section 309—Benefits under contracts with directors (accounting period)

“3.6.02A.

For the purposes of section 111AV of the Corporations Law, subsection 309 (3) of the Law applies, as modified in item 1 in Schedule 9A, to a company that is a disclosing entity.”.

7. New regulation 3.6.06

7.1 After regulation 3.6.05, insert:

Section 331B—Are the financial statements properly drawn up?

“3.6.06. For the purposes of section 111AV of the Corporations Law, paragraph 331B (1) (c) and subsection 331B (2) of the Law apply, as modified in items 2 and 3 in Schedule 9A, to a financial institution that is a disclosing entity.”.

8. Regulation 3.8.02 (Documents that are to accompany an annual return)

8.1 Add at the end:

“(2)

This regulation does not apply to a disclosing entity that lodges copies of documents for an accounting period under subsection 317A (1) of the Corporations Law.”.

9. Regulation 6.12.02 (Prescribed matters for the purposes of clause 18 of a Part A Statement)

9.1 Omit the regulation, substitute:

Prescribed matters—clause 18 of a Part A Statement

“6.12.02.

(1) For the purposes of clause 18 of the Part A Statement set out in section 750 of the Corporations Law, the matters referred to in subregulations (2), (3) and (4) are prescribed.

“(2)

The matters prescribed in relation to offers of the kind specified in paragraph 6.12.01 (a) are, if for shares or debentures:

(a)
that are being offered as consideration are quoted ED securities; and
(b)
in respect of which the requirements of subsection 1022AA (1) of the Law are satisfied;

the matters that would, because of section 1022AA of the Law, be required to be included in the statement if the statement were a prospectus that:

(c)
complies with that section; and
(d)
was issued on the date on which that statement was registered under section 644 of the Law.

“(3)

The matters prescribed in relation to offers of the kind specified in paragraph 6.12.01 (a) (other than those referred to in subregulation (2)) and offers of the kind specified in paragraph 6.12.01 (d) are the matters that would, because of section 1022 of the Law, be required to be included in the statement if:

(a)
the statement were a prospectus that:
(i)
complies with that section; and
(ii)
was issued on the date on which the statement was registered under section 644 of the Law; and
(b)
paragraph 1022 (3) (b) of the Corporations Law were omitted and the following paragraph substituted:
‘(b) the fact that shares or debentures are only being offered to shareholders of the target company;’; and
(c)
paragraph 1022 (3) (d) of the Corporations Law were omitted.

“(4)

The matters prescribed in relation to offers of the kind specified in paragraph 6.12.01 (b) are:

(a)
the matters referred to in subregulation (2) or (3), as the case requires; and
(b)
the matters that would, because of subsection 1045 (3) of the Law, be required to be included in the statement if the statement were a prospectus issued on the date on which the statement is registered under section 644 of the Law.

“(5)

The matters prescribed in relation to offers of the kind specified in paragraph 6.12.01 (c) are:

(a)
the matters referred to in subregulation (2) or (3), as the case requires; and
(b)
the matters that would, because of subsection 1045 (3) of the Law, be required to be included in the statement if the statement were a prospectus issued on the date on which the statement is registered under section 644 of the Law.”.

10. New Part 7.2

10.1 After regulation 7.1.03, insert:

“PART 7.2—SECURITIES EXCHANGES

Securities Exchanges—information exempt from lodgement requirements

“7.2.01.

(1) For the purposes of subsection 776 (2C) of the Corporations Law, subsection 776 (2B) of the Corporations Law does not apply to the following information:

(a)
a Stock Exchange Automated Trading System notification message;
(b)
an Australian Stock Exchange voiceline announcement.”.

“(2)

In this regulation:

‘Stock Exchange Automated Trading System notification message’ means a brief message that is transmitted to computer terminals of persons linked to the Stock Exchange Automated Trading System, that is a summary of information lodged with the Australian Stock Exchange by a company or other entity that is included in the official list of a stock exchange;

‘Australian Stock Exchange voiceline announcement’ means a message from the Australian Stock Exchange spoken over an announcement system, that is a summary of information lodged with the Australian Stock Exchange by a company or other entity that is included in the official list of a stock exchange.”.

11. Regulation 7.12.02 (Exemptions from Chapter 7 of the Corporations Law)

11.1 After “Division 2”, insert “and Division 3A”.

11.2 Omit “does”, substitute “do”.

12. Regulation 7.12.07 (Agents authority to be lodged)

12.1 Omit “lodged under paragraph 1024 (1) (b)”, substitute “or replacement prospectus lodged under subsection 1023B (2) or 1024 (2)”.

13. New regulations 7.12.08A, 7.12.08B, and 7.12.08C

13.1 After regulation 7.12.08, insert:

Information required in section 1043B notice—limitation

“7.12.08A. (1)

For the purposes of subsection 1043C (3) of the Corporations Law, the information that, under subsection 1043C (2) of the Law, must be contained in a notice lodged under section 1043B is limited to the information described in subregulation (2), having regard to:

(a)
the nature of the shares and of the corporation that issued the shares; and
(b)
the kinds of person likely to consider buying the shares; and
(c)
the fact that certain matters may reasonably be expected to be known to professional advisers of any kind whom those persons may reasonably be expected to consult; and
(d)
whether the persons to whom the offers or invitations are to be made or issued are the holders of shares in the corporation and, if they are, to what extent (if any) relevant information has previously been given to them by the corporation under any law or otherwise; and
(e)
any information that may reasonably be expected to be known to investors or their professional advisers by virtue of any Act, State Act or law of a Territory.

“(2)

The required information is information known to, or that could reasonably be expected to be obtained by enquiry by:

(a)
the seller; or
(b)
if the notice includes a statement that purports to be, or to be based on, a statement made by an expert and the expert gave, and did not withdraw, consent to the issue of the notice—that expert; or
(c)
a person named in the notice, with the consent of the person, as stockbroker, sharebroker or underwriter of the seller in relation to the sale of the shares; or
(d)
a person named in the notice, with the consent of the person, as an auditor, banker or solicitor of the seller in relation to the sale of the shares;
(e)
a person named in the notice, with the consent of the person, as having performed, or performing, any function in a professional, advisory or other capacity not mentioned in subparagraph (b), (c), or (d); or
(f)
if the seller is a corporation—a person who was a director of the corporation at the time that the notice was issued; or
(g)
a person who authorised or issued the notice.

Section 1043B notice—application of applicable provisions

“7.12.08B. For the purposes of subsection 1043C (5) of the Corporations Law, the provisions referred to in paragraphs 1043C (6) (a) and (b) of the Law apply, as modified in Part 2 of Schedule 9A, to a notice to which section 1043C applies.

Section 1043B notice—other sales

“7.12.08C. (1) For the purposes of subsection 1043D (2) of the Corporations Law the information that must be contained in a notice under section 1043B (except a notice in relation to prescribed interests) is:

(a)
if the securities to which the offer or invitation relates are shares—whether those shares are fully paid up and, if not fully paid up, to what extent they are paid up; and
(b)
if the securities are units of shares or units of debentures:
(i)
the names and addresses of the persons in whom the shares or debentures are vested; and
(ii)
the date of, and the parties to, any document defining the terms on which those shares or debentures are held; and
(iii)
an address in Australia where the document or a copy of that document can be inspected; and
(c)
a statement that the seller of the securities is acting as principal or as agent of the corporation whose securities are the subject of the notice, as the case may be; and
(d)
if the seller is acting as agent:
(i)
the name of the seller’s principal; and
(ii)
an address in Australia where the principal can be served with process; and
(iii)
details of the remuneration payable by the principal to the seller in relation to the offer or invitation; and
(e)
the date and place of incorporation of the corporation whose securities are the subject of the notice; and
(f)
the address of the registered or principal office of the corporation whose securities are the subject of the notice:
(i)
in the place in which incorporation took place; or
(ii)
if that place is outside Australia—within Australia; and
(g)
the:
(i)
authorised share capital; and
(ii)
issued share capital; and
(iii)
paid-up share capital; and
(iv)
classes into which share capital is divided; and

(v)
rights of each class of shareholders in respect of capital, dividends and voting;
of the corporation whose securities are the subject of the notice; and
(h)
the dividends (if any) paid in respect of each class of shares in each of the 5 financial years preceding the offer or invitation; and
(j)
if no amount has been paid out in respect of the rights or interests of a particular class in the 5 years preceding the offer or invitation—a statement to that effect; and
(k)
the number of any outstanding debentures of the corporation whose securities are the subject of the notice and the rate of interest payable on those debentures; and
(l)
if:
(i)
section 325 or 326 of the Corporations Law applies to the corporation—a copy of the last balance sheet of the corporation; and
(ii)
in any other case—a copy of the most recent audited balance-sheet of the corporation; and
(m)
the names and addresses of the directors of the corporation whose securities are the subject of the notice.

“(2)

For the purposes of subsection 1043D (2) of the Corporations Law, the information that must be contained in a notice under section 1043B that relates to prescribed interests is:

(a)
a statement that the seller of the securities is acting as principal or as agent in relation to the securities that are the subject of the notice, as the case may be; and
(b)
if the seller is acting as agent:
(i)
the name of the seller’s principal; and
(ii)
an address in Australia where the principal can be served with process; and
(iii)
details of the remuneration payable by the principal to the seller in relation to the offer or invitation; and
(c)
the date and place of incorporation of the corporation whose securities are the subject of the notice; and
(d)
the address of the registered or principal office of the corporation whose securities are the subject of the notice:
(i)
in the place in which incorporation took place; or
(ii)
if that place is outside Australia—within Australia; and
(e)
if the trustee or representative for the holders of the prescribed interests is:
(i)
a corporation—the name, date and place of incorporation of the corporation; or
(ii)
a natural person—the name and address of the person; and
(f)
if the trustee or representative is a corporation:
(i)
the address of the registered or principal office of the corporation within Australia; or
(ii)
if that address is outside Australia—an address within Australia at which documents may be served; and
(g)
the date on which the prescribed interest scheme was established and the scheme’s duration (if the deed governing the scheme so provides); and
(h)
a place where the deed governing the scheme may be inspected; and
(j)
the capital contributed to the scheme, any limitation to further contribution and the extent of the liability of the interest holders to make further contribution; and
(k)
the classes into which rights and interests in the scheme are divided and the rights of each class of holders in relation to capital, income and voting; and
(m)
the amount (if any) paid to interest holders in each of the 5 financial years preceding the offer or invitation; and
(n)
if no amount has been paid out in respect of the rights or interests of a particular class in the 5 financial years preceding the offer or invitation—a statement to that effect; and
(o)
the total amount of outstanding debentures issued by the trustee, representative or management company for the purposes of the scheme and rate of interest payable in respect of the debentures; and
(p)
the names and addresses of the directors of:
(i)
the management company; and
(ii)
if the trustee or representative is a corporation—the trustee or representative; and
(q)
a statement that there is liability to make further payments (in the form of capital or otherwise) in respect of the prescribed interests, or that there is not, as the case may be; and
(r)
a copy of the most recent audited balance-sheet for the scheme.”.

14. Regulation 7.12.11 (Section 1021 (Specific provisions applicable to all prospectuses))

14.1 Omit paragraph 1021(6) (a) of the Corporations Law, as modified, substitute:

“(a)
the nature and extent of each interest:
(i)
that exists when the prospectus is lodged, or that existed within 2 years before the prospectus was lodged with the Commission; and
(ii)
that is, or was, an interest of:
(A)
the trustee, or representative or management company in relation to the arrangement, common enterprise, financial or business undertaking, investment contract or scheme; or
(B)
any director or proposed director of the trustee, representative or management company or any promoter or expert;
in the promotion, or in property proposed to be acquired for the purpose of that arrangement, common enterprise, financial or business undertaking, investment contract or scheme in connection with its formation or promotion; or”.

14.2 Paragraph 1021(6) (b) of the Corporations Law, as modified:

Insert “or consisted” after “consists”.

15. New regulation 7.12.14A

15.1 After regulation 7.12.14, insert:

When financial year reports must be sent

“7.12.14A. For the purposes of paragraph 1069 (1) (f) of the Corporations Law, the prescribed period is 90 days.”.

16. Regulation 7.12.15 (Prescribed covenants: paragraph 1069 (1) (n) of the Corporations Law)

16.1 Paragraph (1) (b):

Omit “6 months”, substitute “12 months”.

16.2 Paragraph (5) (o):

Omit the paragraph, substitute:

“(o)
a covenant that the trustee will ensure that:
(i)
a copy of the accounts and the report referred to in subparagraph 1069 (1) (f) (ia) of the Corporations Law; or
(ii)
the statement of the accounts referred to in subparagraph 1069 (1) (f) (i) of the Law;
is given to holders of the prescribed interests, not more than 90 days after the end of the financial year to which the accounts relate.

16.3 Paragraph (7) (a):

Omit “2 months”, substitute “90 days”.

17. New regulation 7.12.15B

17.1 After regulation 7.12.15A, insert:

Management companies—period within which returns must be lodged

“7.12.15B. For the purposes of paragraphs 1071 (1) (a) and (b) of the Corporations Law, the prescribed period is 90 days.”.

18. Regulation 7.12.16 (Return to be lodged under subsection 1071 (1) of the Corporations Law)

18.1 Add at the end:

“(2)

Paragraph 7.12.16 (1) (a) does not apply in relation to a return if it is a return to which section 323K of the Corporations Law applies.”.

19. Regulation 7.12.17 (Prescribed invitation or offer: subsection 1078 (4) of the Corporations Law)

19.1 After paragraph 7.12.17 (b), insert:

“(ba)
an invitation or offer that is:
(i)
made in, or accompanied by, a notice that complies with Division 3A of Part 7.12 of that Law and that has been lodged with the Commission; and
(ii)
sent by post.”.

20. Schedule 1 (List of Forms in Schedule 2)

20.1 Before item 1, insert:

“1AA.	Regulation 1.07A	Information to accompany documents to be lodged	1001
1AB.	Regulation 1.07B	Information to accompany documents to be lodged	1002
1AB.	Regulation 1.07C	Information to accompany documents to be lodged	1003”.

21. Schedule 2 (Forms)

21.1 Before Form 911, insert:

*Australian Company Number/

*Australian Registered Body Number/

*Prescribed Interest Number:

FORM 1001

Corporations Law

INFORMATION TO ACCOMPANY DOCUMENTS TO BE LODGED

(Insert here details specified in regulation 1.07A)

Dated

.....................................................

Signature of *Director/ *Secretary/ *Principal Executive Officer

*Omit if not applicable

___________

*Australian Company Number/

*Australian Registered Body Number/

*Prescribed Interest Number:

FORM 1002

Corporations Law

INFORMATION TO ACCOMPANY DOCUMENTS TO BE LODGED

(Insert heredetails specified in regulation 1.07B)

Dated

.....................................................

Signature of *Director/ *Secretary/ *Principal Executive Officer

* Omit if not applicable

___________

*Australian Company Number/

*Australian Registered Body Number/

*Prescribed Interest Number:

FORM 1003

Corporations Law

INFORMATION TO ACCOMPANY DOCUMENTS TO BE LODGED

(Insert heredetails specified in regulation 1.07C)

Dated

.....................................................

Signature of *Director/ *Secretary/ *Principal Executive Officer

* Omit if not applicable

___________

22. Schedule 7 Chapter 4 (Various Corporations)

22.1 Part 4.2, item 2, column 2:

Omit “bank, banker, banking or words having the same or similar meaning”, substitute:

“bank, banker, banking or words having the same or similar meaning in any language, whether used alone or as part of another word or in combination with other words, letters or symbols”.

23. Schedule

23.1 After Schedule 9, insert:

SCHEDULE 9A

Regulations 3.6.02A

and 7.12.08B

MODIFICATIONS OF CORPORATIONS LAW

PART 1–DISCLOSING ENTITIES

1. Subsection 309 (3) of the Corporations Law is modified by the omission of paragraph (a) and the substitution of the following paragraphs:

“(a) a benefit included in the aggregate amount of emoluments received, or due and receivable, by directors:
(i)
shown, in accordance with regulations in force for the purposes of section 297, in the company’s financial statements for an accounting period that is a financial year; or
(ii)
being received, or due and receivable, in an accounting period that is a half-year, intended to be shown as described in subparagraph (i).”.

2. Paragraph 331B (1) (c) of the Corporations Law is modified as follows:

“(c) if the company is a financial institution that is affected by subregulation 1.2.04 (1)—in accordance with the accounting requirements of section 272 of the Financial Institutions Codes.”.

3. Subsection 331B(2) of the Corporations Law is modified as follows:

“(2)

If, in the auditor’s opinion, the financial statements are not drawn up in accordance with the accounting requirements of section 272 of the Financial Institutions Codes, the report must set out the quantified financial effect on the financial statements of the failure to do so.”.

PART 2—SECONDARY TRADING IN UNQUOTED SECURITIES

4. Section 994 of the Corporations Law is modified as follows:

Interpretation—Statement in a notice to which section 1043C applies

994.

For the purposes of this Part, a statement is taken to be in a notice to which section 1043C applies if it is:

(a)
contained in a report or memorandum that appears on the face of the notice; or
(b)
contained in a report or memorandum that is issued with the notice with the consent or knowledge of a person who authorised or caused the issue of the notice; or
(c)
incorporated by reference in the notice whether the reference occurs in the notice or in any other document.

5. Subsection 995 (2) of the Corporations Law is modified as follows:

(2)A person must not, in or in connection with:

(a)
any dealing in shares; or
(b)
without limiting the generality of paragraph (a):
(i) the issue of shares; or
(ii)
the issuing of a notice to which section 1043C applies or the publishing of any other notice in relation to shares; or
(iii)
the making of takeover offers or a takeover announcement, or the making of an evaluation of, or of a recommendation in relation to, takeover offers or offers constituted by a takeover announcement; or
(iv)
the carrying on of any negotiations, the making of any arrangements or the doing of any other act preparatory to or in any other way related to any matter referred to in subparagraph (i), (ii) or (iii);

engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

6. Subsection 996 (1) of the Corporations Law is modified as follows:

996. (1)A person must not authorise or cause the issue of a notice to which section 1043C applies if:

(a)
the notice has been, or is required to be, lodged under Part 7.12; and
(b)
either:
(i) a material statement in the notice is false or misleading; or
(ii)
there is a material omission from the notice.

7. Subsections 1006 (1) and (2) of the Corporations Law are modified as follows:

Civil liability for false or misleading statement in, or omission from, notice

1006. (1)This section applies for the purposes of an action under section 1005 in respect of the issue of a notice to which section 1043C applies:

(a)
in which there is a material statement that is false or misleading; or
(b)
from which there is a material omission.

(2) The reference in subsection 1005 (1) to any person involved in a contravention includes a reference to all or any of the following persons:

(a)
the seller;
(b)
if the seller is a corporation—a person who was a director of the corporation at the time the notice was issued;
(c)
if the notice includes a statement that purports to be, or is based on, a statement made by an expert and the expert gave, and did not withdraw, consent to the issue of the notice—that expert;
(d)
a person named, with the consent of the person, in the notice as stockbroker, sharebroker or underwriter of the seller, for or in relation to the sale of the shares;
(e)
a person named, with the consent of the person, in the notice as auditor, banker or solicitor of the seller, for or in relation to the sale of the shares;
(f)
a person named, with the consent of the person, in the notice as having performed, or performing, any function in a professional, advisory or other capacity not mentioned in paragraphs (c), (d) or (e) for the seller or in relation to the sale of the shares.

8. Sections 1007 and 1008 of the Corporations Law are modified as follows:

No liability to person with knowledge of relevant matter

1007. A person:

(a) referred to in subsection 1006 (2); or
(b)
who authorised or caused the issue of the notice concerned;

is not liable in an action under section 1005 to a person who suffered loss or damage as a result of a false or misleading statement in, or an omission from, the notice if it is proved that, when the last-mentioned person bought the shares to which the notice relates that person knew that the statement was false or misleading or was aware of the omitted matter.

Non-consenting directors not liable

1008. (1)A person referred to in paragraph 1006 (2) (b) is not, in the circumstances set out in the following provisions of this section, liable in an action under section 1005 to a person who suffered loss or damage as a result of a false or misleading statement in, or an omission from, the notice concerned.

(2)The person is not liable if it is proved that the notice was issued without the person’s knowledge or consent and, as the case may be:

(a)
as soon as practicable after the person became aware of the issue of the notice, the person gave reasonable public notice that it was issued without the person’s knowledge; or
(b)
as soon as practicable after the notice was issued, the person gave reasonable public notice that the notice was issued without the person’s consent.

(3)The person is not liable if it is proved that, after the issue of the notice and before any sale under the notice, the person, on becoming aware of any false or misleading statement in, or omission from, the notice, withdrew the person’s consent to the issue of the notice and gave reasonable public notice of the withdrawal and of the reason for the withdrawal.

9. Subsections 1008A (1) and (2) of the Corporations Law are modified as follows:

1008A. (1)A person referred to in paragraph 1006 (2) (b) is not, in the circumstances set out in the following provisions of this section, liable in an action under section 1005 to a person who suffered loss or damage as a result of:

(a)
a false or misleading statement in the notice concerned; or
(b)
an omission from a statement in the notice.

(2)If the statement referred to in paragraph (1) (a) or (b) (in this section called the “defective statement”):

(a)
purports to be, or to be based on, a statement made by an expert; or
(b)
is contained in what purports to be a copy of, or extract from, a report or valuation of an expert;
the person is not liable if it is proved that:
(c)
the defective statement fairly represented the statement referred to in paragraph (a), or the purported copy or extract was a correct and fair copy of, or extract from, the report or valuation, as the case may be; and
(d)
the person, after making such inquiries (if any) as were reasonable, had reasonable grounds to believe, and did believe until the time of the sale of the shares, that the person who made the statement referred to in paragraph (a), or who made the report or valuation, as the case may be:
(i)
was competent to make it; and
(ii)
had given the consent required by section 1032 to the issue of the notice; and
(iii)
had not withdrawn that consent.

10. Sections 1009, 1010, 1011 and 1012 of the Corporations Law are modified as follows:

Liability of experts, auditors etc.

1009. (1)A person referred to in paragraph 1006 (2)(c), (e) or (f) is liable in an action under section 1005 only in respect of:

(a)
a false or misleading statement in the notice concerned purporting to be made by the person as a person referred to in that paragraph, or to be based on a statement made by the person as a person referred to in that paragraph; or
(b)
in the case of a person referred to in paragraph 1006 (2) (c)—an omission of any material matter from a statement in the notice purporting to be made by the person as a person referred to in paragraph 1006 (2) (c) or to be based on a statement made by the person as such a person; or
(c)
in the case of a person referred to in paragraph 1006 (2) (e) or (f)—an omission from the notice of any material matter for which the person is responsible in his or her capacity or purported capacity as a person referred to in the applicable paragraph.

(2)A person referred to in paragraph 1006 (2) (c) is not liable in an action under section 1005 in respect of a false or misleading statement in, or an omission from, the notice if it is proved:

(a)
that, having given consent under section 1032 to the issue of the notice, the person withdrew it in writing before the notice was lodged; or
(b)
that, after the notice was lodged and before any sale under the notice, the person, on becoming aware of the false or misleading statement, or of the omission, as the case may be, withdrew his or her consent in writing and gave reasonable public notice of the withdrawal and of the reasons for the withdrawal; or
(c)
that the person was competent to make the statement and, after making such inquiries (if any) as were reasonable, had reasonable grounds to believe, and did, until the time of the sale of the shares, believe, that:
(i)
if the action is in respect of a false or misleading statement—the statement was true and not misleading; or
(ii)
if the action is in respect of an omission from a statement—there were no material omissions from the statement.

(3) A person referred to in paragraph 1006 (2) (e) or (f) is not liable in an action under section 1005 in respect of a false or misleading statement in, or an omission from, the notice if it is proved:

(a)
that, after the notice was lodged and before any sale under the notice, the person, on becoming aware of the false or misleading statement, or of the omission, as the case may be, withdrew his or her consent in writing and gave reasonable public notice of the withdrawal and of the reasons for the withdrawal; or
(b)
in the case of a statement—that the person was competent to make the statement and, after making such inquiries (if any) as were reasonable, had reasonable grounds to believe, and did, until the time of the sale of the shares, believe, that the statement was true and not misleading; or
(c)
in the case of an omission—that the person, after making such inquiries (if any) as were reasonable, had reasonable grounds to believe, and did, until the time of the sale of the shares, believe, that there were no omissions from the notice of material matters for which he or she was responsible in his or her capacity as a person referred to in the applicable paragraph and that he or she was competent to act in that capacity.

Liability of persons named in notice etc.

1010. (1) A person referred to in paragraph 1006 (2) (d), (e) or (f) or who is named in part only of the notice concerned is not liable in an action under section 1005 in respect of a false or misleading statement in, or an omission from, the notice if it is proved that:

(a)
the statement was not included in, or the matter was not omitted from, that part of the notice; or
(b)
in the case of a statement—the statement was not included in, or substantially in, the form and context that the person has agreed to.

(2)

For the purposes of subsection (1), a person referred to in paragraph 1006 (2), (d), (e) or (f) must not be taken to be named in part only of the notice unless the notice includes an express statement that the person was involved only in the preparation of that part.

(3)

A person who has authorised or caused the issue of part only of the notice is not liable in an action under section 1005 in respect of a false or misleading statement in, or an omission from, the notice if it is proved that:

(a)
the statement was not included in, or the matter was not omitted from, that part of the notice; or
(b)
in the case of a statement—the statement was not included in, or substantially in, the form and context that the person had agreed to.

(4)For the purposes of subsection (3), a person is not taken to have authorised or caused the issue of part only of a notice unless the notice includes an express statement that the person authorised or caused the issue of that part only.

No liability for mistake etc. if reasonable precautions taken

1011. (1)The seller, a person referred to in paragraph 1006 (2) (a) or (d) or a person who authorised or caused the issue of the notice concerned (in this section, called the “defendant”) is not liable in an action under section 1005 if it is proved that the false or misleading statement or the omission:

(a)
was due to a reasonable mistake; or
(b)
was due to reasonable reliance on information supplied by another person; or
(c)
was due to the act or default of another person, to an accident or to some other cause beyond the defendant’s control;

and, in a case to which paragraph (c) of this subsection applies, that the defendant took reasonable precautions and exercised due diligence to ensure that all statements to be included in the notice were true and not misleading and that there were no material omissions from the notice.

(2)

In paragraphs (1) (b) and (c);

“another person” does not include a person who, when the notice was issued, was:

(a)
a servant or agent of the defendant; or
(b)
if the defendant was the seller or another body corporate—a director, servant or agent of the defendant.

Indemnity

1012. If:

(a)
a notice to which section 1043C applies contains the name of a person as a director of the seller corporation, or as having agreed to become a director, and that person has not consented to become a director, or has withdrawn the consent before the issue of the notice, and has not authorised or consented to the issue of the notice; or
(b)
the consent of a person is required under section 1032 to the issue of the notice and the person either has not given that consent or has withdrawn it before the issue of the notice;

the directors of the seller (except any without whose knowledge or consent the notice was issued) and any other person who authorised or caused the issue of the notice are jointly and severally liable to indemnify the person so named or whose consent was so required against all damages, costs and expenses to which the person may be made liable;

(c)
because of the person’s name being so contained in the notice; or
(d)
because of the inclusion in the notice of a statement purporting to be made by the person as an expert; or
(e)
in defending any action or other legal proceeding brought against the person because of the person’s name being so contained in the notice or the inclusion in the notice of such a statement.

11. Subsections 1017A (2) and (3) of the Corporations Law are modified as follows:

(2)A notice to which section 1043C applies is a registrable notice unless it is exempt from registration under section 1020A because of this section.

(3)A notice is exempt from registration under section 1020A if the relevant offer or invitation is proposed to be made or issued only to:

(a)
existing members of the corporation; or
(b)
an exempt recipient.

12. Section 1020A of the Corporations Law is modified as follows:

Registration of notices

1020A. (1)Subject to section 102A and to subsection (2) of this section, where a registrable notice is lodged together with a written application for the registration of the notice, the Commission must register the notice as soon as possible and in any event within the prescribed period.

(2)The Commission must refuse to register a notice if:

(a)
it appears that the notice does not comply with the requirements of Division 3A; or
(b)
the Commission is of the opinion that the notice contains a false or misleading statement or that there is an omission from the notice.

13. Sections 1023A, 1023B, 1024, 1024A, 1024B, 1024C, 1024D, 1024E and 1025 of the Corporations Law are modified as follows:

Obligation to notify seller of false or misleading statements, changes etc.

1023A. (1) If:

(a)
a notice to which section 1043C applies has been lodged; and
(b)
a person (other than the seller) who:
(i)
is referred to in subsection 1006 (2); or
(ii)
authorised or caused the issue of the notice;
becomes aware of a matter referred to in subsection (2) of this section during the application period in relation to the notice;

the person must, as soon as practicable after becoming so aware, give the seller written notice of the matter.

(2)

These are the matters:

(a)
there is a material statement in the notice that is false or misleading;
(b)
there is a material omission from the notice;
(c)
there has been a significant change affecting a matter included in the notice;
(d)
a significant new matter has arisen the inclusion in the notice of information about which would have been required by this Part if the matter had arisen when the notice was prepared.

Correction of false or misleading statements etc. in notice by a supplementary or replacement notice

1023B.

(1) This section applies if a notice to which section 1043C applies has been lodged and the seller becomes aware, during the application period in relation to the notice, that the notice is deficient because:

(a)
it contains a material statement that is false or misleading; or
(b)
there is a material omission from the notice.

[Note: Because of subsections 1024C (2) and 1024F (1), a notice may be taken to include information in another document.

This should be taken into account when considering whether the notice is deficient.]

(2)

As soon as practicable after becoming so aware, the seller must lodge a supplementary notice or a replacement notice that corrects the deficiency and that complies with whichever of sections 1024A and 1024B applies.

Changes or new matters requiring the issue of a supplementary or replacement notice

1024. (1) This section applies if a notice to which section 1043C applies has been lodged and the seller becomes aware, during the application period in relation to the notice, that:

(a)
there has been a significant change affecting a matter included in the notice; or
(b)
a significant new matter has arisen the inclusion in the notice of information about which would have been required by this Part if the matter had arisen when the notice was prepared.

(2)

As soon as practicable after becoming so aware, the seller must lodge a supplementary notice or a replacement notice that contains particulars of the change or new matter and that complies with whichever of sections 1024A and 1024B applies.

General provisions about supplementary notices

1024A.

(1) A supplementary notice is a document the purpose of which is to do either or both of the following in relation to a notice to which section 1043C applies that it supplements (in this section, called the “original notice”):

(a)
correct a deficiency in the notice;
(b)
provide particulars about something that has occurred since the notice was prepared.

[Note 1: Because of subsections 1024C (2) and 1024F (1) a notice may be taken to include information in another document.

This should be taken into account when considering whether the notice contains a deficiency.

2: The power to issue a supplementary notice is not limited to the situations dealt with in sections 1023B and 1024.]

(2)

On each page of a supplementary notice there must be a clear statement in bold type that states that the document is a supplementary notice that is to be read in conjunction with:

(a)
the original notice; and
(b)
if other supplementary notices have already been issued in relation to the original notice—those supplementary notices.

(3)

The statement must clearly identify:

(a)
the original notice; and
(b)
if paragraph (2) (b) applies—the supplementary notices to which that paragraph refers.

(4)

Unless the context otherwise requires, a reference to a notice in any of the provisions referred to in the following paragraphs includes a reference to a supplementary notice:

(a)
sections 994, 995 and 996;
(b)
sections 1006 to 1012, inclusive;
(c)
sections 1023A, 1024F, 1029, 1031, 1032 and 1033.

(5)

In this section:

“deficiency” in relation to a notice, includes, but is not limited to:

(a)
a material statement in the notice that is false or misleading; or
(b)
a material omission from the notice.

General provisions about replacement notices

1024B.

(1) A replacement notice is a document the purpose of which is to replace a notice to which section 1043C applies (in this section, called the “original notice”) and which may also do either or both of the following:

(a)
correct a deficiency in the original notice;
(b)
provide particulars about something that has occurred since the original notice was prepared.

[Note 1: Because of subsections 1024C (2) and 1024F (1) a notice may be taken to include information in another document.

This should be taken into account when considering whether the notice contains a deficiency.

The power to issue a replacement notice is not limited to the situations dealt with in sections 1023B and 1024.]

(2)

On each page of a replacement notice there must be a clear statement in bold type that identifies the original notice and states that the document is a replacement notice that replaces the original notice.

(3)

Subject to subsection (2), a replacement notice must have the same wording as the original notice, except to the extent that it:

(a)
corrects a deficiency in the original notice; or
(b)
provides particulars about something that has occurred since the original notice was issued.

(4)

In this section:

“deficiency”, in relation to a notice, includes, but is not limited to:
(a)
a material statement in the notice that is false or misleading; or
(b)
a material omission from the notice.

Consequences of lodging a supplementary notice

1024C.

(1) This section applies if a supplementary notice has been lodged.

(2)

Subject to subsection (4), for the purposes of this Law, the information in the supplementary notice is taken, except in relation to things that happened before it was lodged, to be included in the original notice.

(3)

Every copy of the original notice issued after lodgment of the supplementary notice must be attached to, or accompanied by, a copy of the supplementary notice.

(4)

If subsection (3) is contravened in relation to a copy of the original notice, subsection (2) does not apply for the purposes of an action under section 1005 in relation to that copy.

(5)

In this section:

“original notice” means the notice identified in the replacement notice as required by subsection 1024A (3) (a).

Consequences of lodging a replacement notice

1024D.

(1) This section applies if a replacement notice has been lodged.

(2)

A copy of the original notice must not be issued after lodgment of the replacement notice.

(3)

The replacement notice is a notice in its own right for the purposes of this Law, but it is taken to have been issued when the original notice was issued.

(4)

The parts of the replacement notice that are the same as the original notice are taken to comply with the requirements of Division 3A, but only to the extent to which those parts of the original notice in fact complied with those requirements.

(5)

In this section:

“original notice” means the notice identified in the replacement notice as required by subsection 1024B (2).

Inclusion of documents in notice by reference

1024F.

(1) If a notice to which section 1043C applies:

(a)
refers to a document lodged under this Law, under a corresponding law or under a corresponding previous law, being a document in existence at or before the lodgment of the notice; and
(b)
includes a summary of the document or of a part of it; and
(c)
includes a statement to the effect that the seller will provide a copy of the document, or of the part, as the case may be, free of charge, to a person who asks for it during the application period in relation to the notice;

then, for the purposes of this Law, the notice is taken to include the document, or the part of the document, as the case requires.

(2)

The seller must comply with a statement included in the notice in accordance with paragraph (1) (c).

Certain notices etc. not to be published

1025.

(1) In this section:

“notice” does not include a notice to which section 1043C applies that has been lodged or a report, statement or notice the publication of which is permitted under section 1026.

(2)

Nothing in this Part prohibits the publishing of a notice that:

(a)
is published by the person who issued the notice to which section 1043C applies, the holder of a dealers licence, the holder of an investment advisers licence or an exempt dealer; and
(b)
states that a notice in relation to shares of a body corporate or proposed body corporate has been lodged; and
(c)
specifies the date of the notice to which section 1043C applies; and
(d)
states where a copy of the notice can be obtained; and
(e)
specifies the interest (if any) that the person publishing the notice has in the success of the offer or invitation to which the notice relates, being an interest that the person has as underwriter or sub-underwriter to the issue of the shares to which a notice to which section 1043C applies relates or a relevant interest in those shares.

14. Subsections 1026 (2) and (3) of the Corporations Law are modified as follows:

(2)Nothing in this Part prohibits the publishing of:

(a)
a report published on behalf of a body corporate by or on behalf of its directors with the consent of the Commission;
(b)
a report that is a news report (whether or not with other comment), or is genuine comment, published by a person in a newspaper or periodical or by broadcasting or televising relating to:
(i)
a notice to which section 1043C applies that has been lodged or information contained in such a notice; or
(ii)
a report referred to in paragraph (a);
if none of the following:
(iii)
that person; or
(iv)
an agent or employee of that person; or
(v)
where the report or comment is published in a newspaper or periodical the publisher of the newspaper or periodical; or
(vi)
where the report or comment is published by broadcasting or televising—the licensee of the broadcasting or television station by which it is published;
receives or is entitled to receive any consideration or other benefit from a person who has an interest in the success of the issue of shares to which the report or comment relates as an inducement to publish, or as the result of the publication of, the report or comment;
(c)
a report if the report is not published:
(i)
by or on behalf of a body corporate to which the report relates or, whether directly or indirectly, at the instigation of, or by arrangement with, the body corporate or its directors; or
(ii)
by or on behalf of a person who has an interest in the success of the issue of shares to which the report relates;
and the person publishing the report does not receive and is not entitled to receive any consideration or other benefit from the body corporate or any of its directors or from a person mentioned in subparagraph (ii), as an inducement to publish, or as the result of the publication of, the report; or
(d)
a report containing only prescribed matter for the purposes of this subsection or relating only to a body corporate that is, or is included in a class of bodies corporate that is, prescribed for the purposes of this subsection.

(3)Unless provided for by subsection (2), a person who is aware that a notice to which section 1043C applies that relates to the issue of shares:

(a)
is being prepared by or on behalf of a seller; or
(b)
has been issued by or on behalf of a seller;

must not publish a report that is reasonably likely to induce persons to buy those shares.

15. Section 1027 of the Corporations Law is modified as follows:

Evidentiary provisions etc.

1027.

(1) In this section:

“notice”

means a notice within the meaning of section 1025:

“report” means a report within the meaning of section 1026.

(2)

A person who publishes a notice or report relating to a body corporate after receiving a certificate that:

(a)
specifies the names of 2 directors of the body and is signed by those directors; and
(b)
is to the effect that, because of subsection 1025 (2) or 1026 (2), subsection 1025 (3) or 1026 (3), as the case may be, does not apply to the notice or report;

does not contravene subsection 1025 (3) or 1026 (3), as the case may be.

(3)

If a notice or report to which a certificate under subsection (2) relates is published, each director who signed that certificate is taken to have published the notice or report for the purposes of section 1025 and 1026.

(4)

A person who publishes a notice or report to which a certificate under subsection (2) relates must, if the Commission requires the person to do so, deliver the certificate to the Commission as soon as practicable.

(5)

In proceedings for a contravention of section 1025 or 1026 a certificate relating to a notice or report that purports to be a certificate under this section is prima facie evidence that:

(a)
when the certificate was issued, the persons named in the certificate as directors of the body corporate were the directors;
(b)
the signatures in the certificate purporting to be the signatures of the directors are those signatures; and
(c)
the publication of the notice was authorised by those directors.

(6)Nothing in section 1025 or 1026 or this section limits or diminishes the liability that a person may incur, otherwise than under section 1025 or 1026 or this section, under any rule of law or under any other enactment.

16. Section 1029 of the Corporations Law is modified as follows:

Notices—documents to be kept

1029.

(1) The seller in relation to a notice to which section 1043C applies must cause:

(a)
a true copy, verified by a statement in writing, or any consent required by section 1032 to the issue of the notice; and
(b)
a true copy, verified by a statement in writing, of every material contract referred to in the notice or, in the case of such a contract that is not reduced to writing, a memorandum, verified by a statement in writing, giving full particulars of the contract;

to be deposited at the relevant address within 7 days after lodgment of the notice and must keep each copy at the address for at least 12 months after the lodgement of the notice, for inspection by any person without charge.

(2) In this section:

“relevant address” means:

(a)
if the seller is a corporation—the registered office of the corporation; or
(b)
in any other case—the address specified in a notice for the purposes of this section.

17. Sections 1031, 1032 and 1033 of the Corporations Law are modified as follows:

Sale of securities where notice indicates application for quotation on stock market

1031. (1)Subject to this section, where a notice to which section 1043C applies states that application has been or will be made to a securities exchange, whether in Australia or elsewhere, for permission for the shares to be listed for quotation on the stock market of that securities exchange and:

(a)
the permission is not applied for in the form for the time being required by that securities exchange on or before the third day on which that securities exchange is open after the date of issue of the notice; or
(b)
the permission is not granted before the end of 6 weeks after the date of issue of the notice or such longer period, not exceeding 12 weeks, after the date of issue as is, within those 6 weeks, notified to the applicant by or on behalf of the securities exchange;

any sale, whenever made, on an application pursuant to the notice is void and the corporation must repay, in accordance with the following provisions of this section, any money received by it under the notice.

(2)If a seller is liable under subsection (1) to repay money received:

(a)
the money must be repaid as soon as practicable without interest; and
(b)
if the seller is a corporation and the money is not repaid:
(i)
if the liability to repay the money arose because of paragraph (1) (a)—within 14 days after the third day referred to in that paragraph; or
(ii)
if the liability to repay the money arose because of paragraph (1) (b)—within 14 days after:
(A)
the period of 6 weeks first referred to in that paragraph; or
(B)
if a longer period has been notified under that paragraph—that longer period;
then, in addition to the liability of the corporation to repay the money, the directors are jointly and severally liable to repay the money with interest at the rate of 8% per annum (or, if another rate is prescribed, that other rate) calculated from the end of the 14 days referred to in subparagraph (i) or (ii), as the case requires.

(3)If, in relation to any shares of a corporation:

(a)
permission is not applied for (as specified in paragraph (1) (a)); or
(b)
permission is not granted (as specified in paragraph (1) (b));

the Commission may, by notice published in the Gazette, on the application of the seller made before any shares are purportedly sold, exempt the sale of the shares from the operation of this section.

(4)A director is not liable under this section if it is proved that the default in the repayment of the money was not due to any misconduct or negligence on the part of that director.

(5)Without limiting the application of any of the other provisions of this section, the section applies, in relation to shares agreed to be taken by a person underwriting an offer of, or invitation in relation to, those shares that is contained in a notice to which section 1043C applies, as if the person had applied for those shares under the notice.

(6)A seller that receives money under a notice under subsection (5) must keep the money in a separate bank account so long as the seller is liable to repay it under this section.

(7)If a securities exchange has, within the period applicable under paragraph (1) (b), granted permission subject to compliance with any requirements specified by the securities exchange, permission is taken to have been granted by the securities exchange if the directors of the corporation have given to the securities exchange an undertaking in writing to comply with the requirements of the securities exchange.

(8)A director of a corporation must not contravene an undertaking given under subsection (7).

(9)A person must not issue a notice to which section 1043C applies if the notice includes:

(a)
a false or misleading statement that permission has been granted for those shares to be dealt in or quoted or listed for quotation on a stock market of a securities exchange; or
(b)
a statement in any way referring to any such permission, or to dealing in or quoting or listing the shares on, or on a stock market of, a securities exchange, or to any requirements of a securities exchange unless that statement is, or is to the effect that, permission has been granted or that application has been or will be made to the securities exchange within 3 days after the issue of the notice.

(10)A condition requiring or binding, or purporting to require or bind, a buyer of shares to waive compliance with a requirement of this section is void.

Expert’s consent to issue of notice containing statement by the expert

1032.A person must not issue a notice to which section 1043C applies that includes a statement purporting to be made by an expert or to be based on a statement made by an expert unless:

(a)
the expert has given, and has not, before lodgment of the notice, withdrawn, the expert’s written consent to the issue of the notice with the statement included in the form and context in which it is included; and
(b)
there appears in the notice a statement that the expert has given, and has not withdrawn, the expert’s consent.

Order to stop issue of shares

1033. (1)If it appears to the Commission that any of the circumstances referred to in subsection (2) exist in respect of a notice to which section 1043C applies, the Commission may, by order in writing served on the person by whom the notice was lodged, direct that no further shares to which the notice relates be sold under the notice.

(2)

The circumstances are:

(a)
the notice contravenes in a substantial respect any of the requirements of Division 3A;
(b)
the notice contains a statement, promise, estimate or forecast that is false, misleading or deceptive; and
(c)
the notice contains a material misrepresentation.

(3)Subject to this section, the Commission must not make an order under subsection (1) unless the Commission has held a hearing and given a reasonable opportunity to any interested persons to make oral or written submission to the Commission on the question whether such an order should be made.

(4)If the Commission considers that any delay in making an order under subsection (1) pending the holding of a hearing would prejudice the public interest, the Commission may make an interim order or interim orders under that subsection without holding a hearing.

(5)Subject to subsection (6), an interim order, unless sooner revoked, has effect until the end of 21 days after the day on which it is made.

(6)At any time during the hearing, the Commission may make an interim order under subsection (1) that is expressed to have effect until the Commission makes a final order after the conclusion of the hearing or until the interim order is revoked, whichever first happens.

(7) While an order is in force under this section, Division 3A applies as if the notice had not been lodged and a person is not entitled to lodge a further notice in relation to shares that are or include any of the shares to which the first-mentioned notice relates, unless:

(a)
the seller in relation to the further notice is not, and is not an associate of, the seller in relation to the first-mentioned notice; or
(b)
the further notice is a supplementary notice under section 1024.

(8) If, while an order is in force under this section, the Commission becomes satisfied that the circumstances that resulted in the making of the order no longer exist:

(a) because a supplementary notice or replacement notice has been lodged; or
(b)
for any other reason;

the Commission may revoke the order by further order in writing.

18. Sections 1039, 1040 and 1041 of the Corporations Law are modified as follows:

Certain conditions void

1039.

A condition requiring or binding, or purporting to require or bind, a buyer of shares of a corporation to waive compliance with any requirement of Division 3A is void.

Shares not to be sold after 12 months

1040. A seller in relation to a notice to which section 1043C applies must not sell shares under the notice after the end of 12 months after the issue of the notice.

Validity of sale of shares

1041.

A sale of shares of a corporation is not void or voidable merely because it took place more that 12 months after the issue of the relevant notice to which section 1043C applies.

NOTES

1. Notified in the Commonwealth of Australia Gazette on 2 September 1994.
2. Statutory Rules 1990 No. 455 as amended by 1991 Nos. 218, 219, 281, 341, 453, 478 and 479; Act No. 200, 1991; Statutory Rules 1992 Nos. 230, 281, 364, 395 and 450; 1993 Nos. 135, 207 and 277; 1994 Nos. 35, 108, 153, 221 and 251.