Approval to hold a stake in a financial sector company of more than 15% - Aspen Insurance Holdings Limited

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Legislation au C2014G01911 In force Gazette

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Approval to hold a stake in a financial sector company of more than 15%

 

Financial Sector (Shareholdings) Act 1998

 

 

SINCE

 

  1. Aspen Insurance Holdings Limited (Registration No. 32164, Bermuda) and the person(s) named in the attached Schedule (the applicants) have applied to the Treasurer under section 13 of the Financial Sector (Shareholdings) Act 1998 (the Act), for approval to hold a stake of more than 15% in each of the companies listed in       the attached Schedule (the Companies), financial sector companies under the Act; and

 

B.                 I am satisfied that it is in the national interest to approve the applicants holding a stake in each of the Companies of more than 15%,

 

I, Nigel Phillip John Boik, a delegate of the Treasurer, under subsection 14(1) of the Act, APPROVE the applicants holding a stake in each of the Companies of 100 %.

 

This Approval commences on the date that Aspen Fenchurch Limited (Company No. 9172494) acquires a 100% stake in Aspen Insurance UK Limited (ABN 33 128 637 650) and remains in force indefinitely.

 

 

Dated: 18 November 2014

 

[Signed]

 

 

Nigel Phillip John Boik General Manager

Specialised Institutions Division

Interpretation Document ID: 215060

 

In this Notice:

financial sector company has the meaning given in section 3 of the Act.

stake in relation to a company, has the meaning given in clause 10 of Schedule 1 to the Act.

unacceptable shareholding situation has the meaning given in section 10 of the Act.

Note 1


Under paragraph 16(2)(a) of the Act, the Treasurer may, by written notice given to a person who

holds an Approval under section 14, impose one or more conditions or further conditions to which the Approval is subject. Under paragraph 16(2)(b) of the Act, the Treasurer may revoke or vary any condition imposed under paragraph 16(2)(a) of the Act or specified in the Notice of Approval. The Treasurer’s power under subsection 16(2) of the Act may be exercised on the Treasurer’s own initiative or on application made to the Treasurer in accordance with the requirements of subsection 16(4) of the Act, by the person who holds the Approval (see subsection 16(3) of the Act).

Note 2


A person who holds an Approval under section 14 may apply to the Treasurer under section 17(1) of

the Act, to vary the percentage specified in the Approval.

Note 3


Under subsection 17(6) of the Act, the Treasurer may, on the Treasurer’s own initiative, by written

notice given to a person who holds an Approval under section 14, vary the percentage specified in the Approval if the Treasurer is satisfied that it is in the national interest to do so.

Note 4


The circumstances in which the Treasurer may revoke a person’s Approval under section 14 are set

out in subsection 18(1) of the Act.

Note 5


Section 19 of the Act provides for flow-on approvals. If an Approval has been granted for the

holding of a stake in a financial sector company and the financial sector company is a holding company for an authorised deposit-taking institution or an authorised insurance company, then an approval is taken to exist for the holding of a stake of equal value in each financial sector company that is a 100% subsidiary of the holding company.

Note 6


Under section 14 of the Act, the Treasurer must give written notice of this Approval to the applicant

and financial sector company concerned, and must publish a copy of this Notice in the Gazette.

Note 7


Under section 11 of the Act, a person or 2 or more persons under an arrangement are guilty of an

offence if the person(s) acquires shares in a company and the acquisition has the result, in relation to a financial sector company, that:

(i)         an unacceptable shareholding situation comes into existence; or

(ii)       if an unacceptable shareholding situation already exists in relation to the company and in relation to a person – there is an increase in the stake held by the person in the company;

and the person(s) was reckless as to whether the acquisition would have that result. A maximum penalty of 400 penalty units applies or by virtue of subsection 4B(3) of the Crimes Act 1914, in the case of a body corporate, a penalty not exceeding 2,000 penalty units. By virtue of section 39 of the Act, an offence against section 11 is an indictable offence.

 

 

· Aspen Bermuda Limited (Registration No. 32866, Bermuda)

· Acorn Limited (Registration No. 43206, Bermuda)

· Aspen (UK) Holdings Limited (Company No. 4785892, UK)

· Aspen Managing Agency Limited (Company No. 5343237, UK)

· Silverton Re Ltd. (Registration No. 48140, Bermuda)

· Aspen (US) Holdings Limited (Company No. 8126682, UK)

· Aspen Capital Advisors Inc. (Registration No. 5343342, Delaware, US)

· Aspen Capital Management, Ltd (Registration No. 47745, Bermuda)

· Peregrine Reinsurance Ltd (Registration No. 47746, Bermuda)

· Aspen Cat Fund Limited (Registration No. 47880, Bermuda)

· Aspen Insurance UK Limited (ABN 33 128 637 650)

· Aspen Underwriting Limited (Company No. 6459518, UK)

· Aspen Risk Management Limited (Company No. 7283798, UK)

· Aspen Insurance UK Services Limited (Company No. 4270446, UK)

· AIUK Trustees Limited (Company No. 5343237, UK)

· APJ Continuation Limited (Company No. 5319265, UK)

· APJ Asset Protection Jersey Limited (Registration No. 81219, Jersey)

· Aspen UK Syndicate Services Limited (Company No. 05313771, UK)

· Aspen Recoveries Limited (Company No. 8228285, UK)

· Aspen U.S. Holdings, Inc. (Registration No. 3665207, Delaware, US)

· Aspen Insurance U.S. Services Inc. (Registration No. 3663029, Delaware, US)

· Aspen Specialty Insurance Solutions LLC (Registration No. 200715810092, California, US)

· Aspen Specialty Insurance Company (NAIC No. 10717, North Dakota, US)

· Aspen Specialty Insurance Management, Inc. (Registration No. 030528326, Massachusetts, US)

· Aspen Re America, Inc. (Registration No. 3727194, Delaware, US)

· Aspen Re America CA LLC (Registration No. 200714110089, California, US)

· Aspen Re America Risk Solutions LLC (Registration No. 0961774, Connecticut, US)

· Aspen American Insurance Company (NAIC No. 43460, Texas, US)

· Aspen Fenchurch Limited (Company No. 9172494, UK)

 

 

· Aspen Fenchurch Limited (Company No. 9172494, UK)

· Aspen Insurance UK Limited (ABN 33 128 637 650)

Overview

The Financial Sector (Shareholdings) Act 1998 was enacted to address the issue of significant shareholdings in financial sector companies, ensuring that such holdings do not pose a risk to the financial system's stability. This Act was introduced by the Commonwealth Parliament with the policy objective of preventing unacceptable shareholding situations, where an individual or entity's control over a financial institution could undermine the integrity and stability of the financial sector. Under the Act, the Treasurer is authorised to approve or disapprove shareholdings exceeding 15% in financial sector companies. This legislative framework ensures that the national interest is safeguarded by preventing undue concentration of ownership that could lead to conflicts of interest or instability in the financial sector. In the context of the specific approval for Aspen Insurance Holdings Limited and related entities to hold a stake of more than 15% in various financial sector companies, the decision was made under the authority delegated to the Treasurer by the Financial Sector (Shareholdings) Act 1998. The approval granted to Aspen Insurance Holdings Limited and the listed entities to hold a stake of 100% in certain companies was deemed to be in the national interest, reflecting a balance between enabling investment and maintaining regulatory oversight to protect the financial system. This approval underscores the importance of scrutinising significant shareholdings to maintain the resilience and stability of Australia's financial institutions.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 governs the acquisition and holding of stakes in financial sector companies in Australia. This Act applies to any person or entity, including foreign entities, seeking to hold more than a 15% stake in a financial sector company, which is defined under the Act. The scope of the Act extends to Commonwealth, state, and territory jurisdictions within Australia, making it a national regulatory framework. The Act requires that any person or entity must apply to the Treasurer for approval to hold a stake exceeding 15% in a financial sector company, and approval is granted if deemed to be in the national interest. The Act allows for the imposition of conditions, variation, and revocation of approvals by the Treasurer. Notably, the Act also provides for flow-on approvals, where an approval for a holding company extends to its subsidiaries. The Act does not specify particular exclusions but outlines circumstances under which the Treasurer may impose conditions or revoke an approval. The Act's provisions can be extended or restricted through subordinate instruments, as evidenced by the approval granted to Aspen Insurance Holdings Limited and its related entities to hold a 100% stake in certain companies, subject to specific conditions and national interest considerations.

Key Provisions

The Financial Sector (Shareholdings) Act 1998 governs the acquisition and holding of stakes in financial sector companies. Under this Act, significant shareholdings in such companies, specifically those exceeding 15%, require approval from the Treasurer (sections 13 and 14). The applicants, Aspen Insurance Holdings Limited and the individuals named in the attached Schedule, have applied for and received approval to hold a stake exceeding 15% in a number of financial sector companies listed in the Schedule. The approval was granted by Nigel Phillip John Boik, a delegate of the Treasurer, who determined that it was in the national interest for the applicants to hold the specified stakes (section 14). This approval allows the applicants to hold a 100% stake in Aspen Fenchurch Limited and Aspen Insurance UK Limited, and it remains in effect indefinitely once Aspen Fenchurch Limited acquires a 100% stake in Aspen Insurance UK Limited. The Act imposes several obligations on the parties involved. Firstly, it mandates that the Treasurer must notify the applicant and the relevant financial sector company of any approval granted under section 14. Additionally, the Treasurer is required to publish a copy of the approval notice in the Gazette (section 14). The Act also provides the Treasurer with the authority to impose, revoke, or vary conditions on an approval (section 16). This includes the power to adjust the percentage specified in an approval if deemed necessary in the national interest (subsection 17(6)). The applicants, or any person holding an approval, can apply to vary the percentage specified in their approval (section 17(1)). Section 11 of the Act outlines the penalties for certain acquisitions of shares in financial sector companies. Specifically, it criminalises the acquisition of shares if such acquisition results in an "unacceptable shareholding situation" or an increase in an existing unacceptable shareholding situation, where the person acquiring the shares was reckless as to the outcome. An "unacceptable shareholding situation" is defined in section 10 of the Act. The penalties for contravening section 11 include a maximum penalty of 400 penalty units for individuals and up to 2,000 penalty units for bodies corporate (subsection 4B(3) of the Crimes Act 1914). These offences are indictable, meaning they can be prosecuted in a higher court (section 39 of the Act).

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.