Approval to hold a stake in a financial sector company of more than 15% - Budget Holdings Ltd Co

Administered by Department of the Treasury

Legislation au C2013G01879 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. Budget Holdings Ltd Co No 24037 (Guernsey) 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 Auto & General Insurance Company Limited ACN 111 586 353 (the Company), a financial sector company under the Act; and

 

B.                 I am satisfied that it is in the national interest to approve the applicants holding a stake in the Company 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 the Company of 100 %.

 

Under subsection 16(1) of the Act, this Approval is subject to the conditions set out in the attached Schedule.

 

This Approval commences on the date The Reef Foundation (Guernsey) becomes the trustee of The Concrete Trust and remains in force indefinitely.

 

 

Dated: 9 December 2013

 

[Signed]

 

 

 

Nigel Phillip John Boik

Acting Executive General Manager Specialised Institutions Division

Interpretation Document ID: 210917

 

 

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.

Note 8


Under subsection 32(3) of the Act, if a person has engaged or is proposing to engage in any conduct

in contravention of a condition to which an approval under section 14 is subject, the Federal Court may, on the application of the Treasurer, grant an injunction:

(i)         restraining the person from engaging in the conduct; and,

(ii)       if in the court’s opinion, it is desirable to do so- requiring the person to do something.

Schedule - the person(s) who applied for approval

 

 

ASSOCIATES OF BUDGET HOLDINGS LTD CO NO 24037 (GUERNSEY)

 

Klinkert Investments Pty Ltd ACN 086 314 285

 

 

Companies incorporated in Guernsey:

Reef Holdings Limited

R&H Trust Co. (Guernsey) Ltd

Maitland Trustees Limited (formerly Credit Suisse Trust Ltd) Reef Management Services Limited

BHL Management Services Limited Jacana Re Limited

BHL Europe Holding Limited Investor 20:25 Limited

BHL Minorities Limited

The Reef Foundation (Guernsey)

 

 

Companies Incorporated in the United Kingdom: BGL Group Ltd (formerly Budget Group Ltd) Budget Insurance Company Ltd

Direct Insurance Systems Corporation Ltd BFSL Ltd

ACM ULR Ltd BISL Ltd

Budget Retail Ltd

Fusion Contact Centre Services Ltd

Budget Commercial Insurance Services Ltd Bakewell Property Development Ltd Budget Financial Services Ltd

Budget Insurance Intermediaries Ltd GF Bennett (Holdings) Ltd

Budget Group Ltd

Dial Direct Insurance Marketing Ltd Dial Direct Finance Ltd

Pratt’s Insurance Office IGO ECO Ltd

Budget Insurance Services Ltd Courtanet SAS Verzekeringssite

Coral Administration Services Limited BGL Direct Life Ltd

Minster Law Limited

BHL (UK) Holdings Limited

 

 

Companies Incorporated in Australia:

Auto & General Holdings Pty Ltd ACN 086 321 459 Auto & General Services Pty Ltd ACN 003 617 909

Direct Insurance Systems Company Pty Ltd ACN 086 321 422 Budget Direct Insurance Agency Pty Ltd ACN 094 408 545 Auto & General Insurance Services Pty Ltd ACN 094 408 483 Auto & General Training Pty Ltd ACN 089 508 583

Budget Insurance Brokers Pty Ltd ACN 089 508 547 Budget Direct Insurance Brokers Pty Ltd ACN 088 124 627 Retirease Insurance Agency Pty Ltd ACN 094 425 233

Financial Holdings Australia Pty Ltd ACN 112 971 132

Compare the Market Pty Ltd ACN 117 323 378

Bennetts Motorcycle Insurance Pty Ltd ACN 112 121 838

Affinisure Pty Ltd ACN 128 885 469

Ibuyeco Pty Ltd ACN 127 997 175

 

 

Companies Incorporated in South Africa: Telesure Investment Holdings Pty Ltd Dial Direct Insurance Ltd

Auto & General Insurance Company Ltd Napier Gardens (Pty) Ltd

Budget Insurance Brokers (Pty) Ltd Upstream Advertising (Pty) Ltd

First For Women Insurance Brokers (Pty) Ltd Motowise (Pty) Ltd

Douw Steyn Properties (Pty) Ltd

Direct Integrated Systems Corporation (SA) (Pty) Ltd No. 1 Queen Road Property (Pty) Ltd

Budget Insurance Company Ltd Firstprize Solutions (Pty) ltd

1 Life Direct Insurance Ltd Saxon Hotel (Pty) Ltd

Hippo Comparative Services (Pty) Ltd Telesure Financial Services (Pty) Ltd OneCall Insurance Brokers (Pty) Ltd Business Asset Rental (Pty) Ltd Telesure Group Services (Pty) Ltd GIP Construction (Pty) Ltd

Ponte Vedra Warehouse (Pty) Ltd Steyn City Properties (Pty) Ltd Dashpay (Pty) Ltd

Jenus Health (Pty) Ltd

 

 

Companies Incorporated in the British Virgin Isles:

Jacamar Overseas Limited

 

Companies Incorporated in Gibraltar

Coral Underwriting Limited

Schedule - the conditions imposed on this Approval

 

 

1.      Shares held in the company by Budget Holdings Ltd Co No 24037 (Guernsey) and the Budget Holdings Associates (other than Klinkert Investments Pty Ltd ACN 086 314

285) must not in total exceed 85% of the Company’s issued shares; and

 

 

2.      Shares held in the Company by Klinkert Investments Pty Ltd ACN 086 314 285 must not exceed 15% of the Company’s issued shares.

Overview

The Financial Sector (Shareholdings) Act 1998 was enacted to address potential risks to the financial sector arising from significant shareholdings by ensuring that the ownership and control of financial sector companies remain in the hands of individuals and entities that can maintain their stability and integrity. The Act was introduced by the Parliament of Australia and seeks to protect the national interest by preventing unacceptable shareholding situations that could threaten the financial system's stability. This legislation empowers the Treasurer to approve or impose conditions on shareholdings exceeding 15% in financial sector companies, thus maintaining the sector's resilience and safeguarding public confidence. The Act ensures that any significant changes in shareholding are closely monitored and regulated to mitigate potential systemic risks.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 governs the approval process for any entity seeking to acquire a shareholding of more than 15% in a financial sector company. This Act applies to a broad range of entities, including companies incorporated in Australia and overseas, as well as individuals and groups acting in concert, provided they are seeking to acquire a stake in a financial sector company as defined under the Act. The legislation operates nationally, thereby imposing uniform standards across all states and territories of Australia. The Act includes specific provisions for exemptions and thresholds, particularly concerning the percentage of shares that can be held without requiring explicit approval. Furthermore, the Treasurer has the authority to impose additional conditions on any approval granted under the Act, either proactively or in response to an application by the entity holding the approval. This flexibility allows for a dynamic regulatory environment that can adapt to changing circumstances and ensure that the national interest is safeguarded.

Key Provisions

The Financial Sector (Shareholdings) Act 1998, as referenced in the Gazette, regulates the approval process for individuals or entities holding significant stakes in financial sector companies. Under section 13 of the Act, an application must be made to the Treasurer for approval to hold a stake exceeding 15% in a financial sector company. Section 14 empowers the Treasurer, or a delegate such as Nigel Phillip John Boik, to approve such applications if deemed in the national interest. In this particular case, Budget Holdings Ltd Co No 24037 (Guernsey) and associated entities have been granted approval to hold up to 100% of the shares in Auto & General Insurance Company Limited ACN 111 586 353, subject to the conditions outlined in the attached schedule. The Act imposes several obligations on the parties involved. Firstly, the approval process requires the applicants to demonstrate that their shareholding aligns with national interests, as determined by the Treasurer. Additionally, section 16 allows the Treasurer to impose specific conditions on the approval, which in this case include limits on the total shareholding of certain entities. The Act also mandates that the Treasurer notify the applicant and the financial sector company of the approval and publish it in the Gazette, as stipulated in section 14. Furthermore, the applicants must comply with any additional conditions imposed by the Treasurer under section 16, which can be varied or revoked at the Treasurer's discretion. The Act includes provisions for offences and penalties related to shareholding in financial sector companies. Section 11 of the Act criminalises the acquisition of shares that result in an "unacceptable shareholding situation" if done recklessly. This offence carries a maximum penalty of 400 penalty units for individuals, or 2,000 penalty units for a body corporate, as per subsection 4B(3) of the Crimes Act 1914. Additionally, under subsection 32(3) of the Act, the Federal Court can grant an injunction to restrain any conduct in contravention of the conditions imposed on an approval, at the application of the Treasurer. These provisions underscore the seriousness with which the Act treats compliance with its requirements.

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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.