Approval to hold a stake in a financial sector company of more than 15% - Carroll Superannuation Pty Ltd

Administered by Department of the Treasury

Legislation au C2014G00834 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

To: Carroll Superannuation Pty Ltd ACN 089 540 205 (the applicant)

 

SINCE

 

  1. The applicant has applied for an approval under section 13 of the Financial Sector (Shareholdings) Act 1998 (the Act), to hold a stake of more than 15% in Avea Insurance Limited ABN 18 009 129 793 (the Company);

 

B.                 Associates of the applicant, listed in Schedule 1, were granted approval on 19 September 2013 to hold a 100% stake in the Company; and

 

C.                 I am satisfied it is in the national interest to approve the applicant to hold a stake in the Company of more than 15%,

 

I, Stephen Edward Glenfield, a delegate of the Treasurer, under subsection 14(1) of the Act, APPROVE the applicant to hold 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 Schedule 2.

This instrument comes into force on the date it is signed and remains in force indefinitely.

Dated: 20 May 2014

 

[Signed]

 

Stephen Edward Glenfield

General Manager

Specialised Institutions Division

South West Region

 

 

 

 

 

Interpretation

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 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 2 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 conditions imposed under paragraph 16(2)(a) of the Act or specified in the Notice of Approval. The Treasurer’s powers under subsection 16(2) may be exercised on the Treasurer’s own initiative or an 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 3 A person who holds an Approval under section 14 of the Act may apply to the Treasurer under subsection 17(1) of the Act, to vary the percentage specified in the Approval.

Note 4 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 it is in the national interest to do so.

 

Note 5 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 6 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 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 section 32(3) of the Act, if a person has engaged in 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 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 1 – associates of the applicant

 

The following associates of the applicant were approved to hold a stake of up to 100% in the Company on 19 September 2013:

 

Presidian Pty Ltd ACN 161 877 005

Steven Kloss Pty Ltd ACN 083 227 552

Kilienz Pty Ltd ACN 078 276 338

Four Us Pty Ltd ACN 076 542 526

Rainbow TJP Superannuation Fund Pty Ltd ACN 161 369 562

Rainbow LOZ Superannuation Fund Pty Ltd ACN 161 369 508

Rainbow LCP Superannuation Fund Pty Ltd ACN 161 369 571

Rainbow End Investments Pty Ltd ACN 067 489 329

 

 

Schedule 2 – the conditions imposed on this Approval

 

  1. The applicant must not have a direct control interest in the Company of more than 7.5%.

 

direct control interest has the meaning given in clause 11 of Schedule 1 to the Act

Overview

The Financial Sector (Shareholdings) Act 1998 was enacted to address the problem of unacceptable shareholding situations in the financial sector, ensuring that no single entity or group can acquire a dominant position that may threaten the stability and integrity of the financial system. The Act was introduced by the Parliament of Australia with the policy objective of maintaining the financial stability of the country. This legislation provides the Treasurer with the authority to approve or disapprove shareholdings in financial sector companies that exceed a 15% stake, ensuring that such shareholdings do not pose a risk to the national financial system. The Act allows for the imposition of conditions on these approvals to safeguard against potential risks, thereby maintaining the stability and soundness of the financial sector. The approval process under the Act is overseen by the Treasurer, who may delegate this responsibility to authorised officers, such as Stephen Edward Glenfield in this case.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 applies to entities seeking to acquire or hold a significant stake in a financial sector company, specifically targeting those situations where the shareholding exceeds 15%. The Act is of Commonwealth jurisdiction, thereby extending its application across the entire nation. The Act is concerned with entities such as corporations, partnerships, and individuals who wish to hold a stake in financial sector companies, including banks, insurance companies, and other authorised deposit-taking institutions. The Act imposes certain conditions on approvals for shareholdings exceeding 15% to ensure that such holdings do not lead to unacceptable shareholding situations. Exclusions and exemptions are not explicitly stated in the text, but the Act does provide mechanisms for the Treasurer to impose additional conditions, vary existing ones, or revoke approvals entirely if necessary. The Act’s application can be extended or restricted through subordinate instruments, allowing for adjustments in response to changing circumstances or national interests.

Key Provisions

The Financial Sector (Shareholdings) Act 1998 (the Act) governs the approval process for holding significant stakes in financial sector companies. Section 13 of the Act outlines the procedure for an applicant to obtain approval for holding a stake exceeding 15% in a financial sector company. In the case of Carroll Superannuation Pty Ltd, this approval has been granted to hold a 100% stake in Avea Insurance Limited, subject to specific conditions (subsection 14(1)). The approval is also contingent upon the satisfaction of the delegate of the Treasurer that such approval is in the national interest (subsection 14(1)). This approval is subject to the conditions detailed in Schedule 2 and comes into force upon signing and remains in effect indefinitely (subsection 16(1)). The Act imposes several obligations on the parties it governs. Firstly, any person or entity seeking to hold a stake of more than 15% in a financial sector company must apply for approval under section 13 of the Act. Secondly, once approval is granted, the conditions imposed under section 16 of the Act must be adhered to. For Carroll Superannuation Pty Ltd, this includes a restriction on the direct control interest in Avea Insurance Limited to no more than 7.5% (Schedule 2). Furthermore, the Treasurer has the authority to impose additional conditions, vary existing conditions, or revoke the approval if necessary (subsection 16(2)). The applicant also has the right to apply for a variation of the percentage specified in the approval (subsection 17(1)), and the Treasurer can vary the percentage on their own initiative (subsection 17(6)). The Act includes provisions for offences, penalties, and consequences for non-compliance. Section 11 of the Act makes it an offence for a person or group to acquire shares in a company if it results in an unacceptable shareholding situation, particularly if done recklessly. The maximum penalty for individuals is 400 penalty units, and for bodies corporate, it is 2,000 penalty units (subsection 4B(3) of the Crimes Act 1914). Additionally, an indictable offence is established under section 39 of the Act for contraventions of the conditions to which an approval is subject. The Federal Court can grant an injunction to restrain any conduct in contravention of such conditions (subsection 32(3)). This legal framework ensures that significant shareholdings in the financial sector are managed in a manner that aligns with national interests and regulatory standards.

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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.