Approval to hold a stake in a financial sector company of more than 15% - Fidelity National Financial, Inc., Stewart Information Services Corporation, S Hold Co LLC, Stewart Title Guaranty Company

Administered by Department of the Treasury

Legislation au C2019G00138 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: Fidelity National Financial, Inc., Stewart Information Services Corporation,
S Hold Co LLC, Stewart Title Guaranty Company (the applicants)

 

SINCE

 

  1. Fidelity National Financial, Inc. (Fidelity), Stewart Information Services Corporation (SISCO), S Hold Co LLC (S Hold Co) and Stewart Title Guaranty Company (STGC) (the applicants) have applied to the Treasurer under section 13 of the Financial Sector (Shareholdings) Act 1998 (the Act) for approval to hold a 100% stake in Stewart Title Limited ABN 59 101 720 101 (STL), a financial sector company under the Act;

 

B.     Fidelity, SISCO and S Hold Co have applied to the Treasurer under section 13 of the Act for approval to hold a 100% stake in STGC, a financial sector company under the Act;

 

C.     Fidelity has applied to the Treasurer under section 13 of the Act for approval to hold a 100% stake in SISCO, a financial sector company under the Act, until such time as SISCO merges into S Hold Co;

 

D.     Fidelity has applied to the Treasurer under section 13 of the Act for approval to hold a 100% stake in S Hold Co, a financial sector company under the Act, from the time SISCO merges into S Hold Co;

 

E.     I am satisfied that it is in the national interest to approve:

 

  1. The applicants to hold a 100% stake in STL;
  2. Fidelity, SISCO and S Hold Co to hold a 100% stake in STGC;
  3. Fidelity to hold a 100% stake in SISCO until such time as SISCO merges into S Hold Co; and
  4. Fidelity to hold a 100% stake in S Hold Co from the time SISCO merges into S Hold Co.

 

I, Louis Serret, a delegate of the Treasurer:

 

(a)   under section 14(1) of the Act, APPROVE:

(i)                  the applicants to hold a 100% stake in STL;

(ii)                Fidelity, SISCO and S Hold Co to hold a 100% stake in STGC;

 

(iii)               Fidelity to hold a 100% stake in SISCO until such time as SISCO merges into S Hold Co only; and

 

 

(iv)              Fidelity to hold a 100% stake in S Hold Co from the time SISCO merges into S Hold Co only. 

 

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

Dated 20 December 2018

 

[Signed]

 

………………………

Louis Serret

General Manager

Specialised Institutions Division

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interpretation

In this Notice:

 

100% subsidiary has the meaning given in section 3 of the Act

authorised insurance company has the meaning given in section 3 of the Act

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

holding company has the meaning given by section 4 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 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 2 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 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 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 applicants 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 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.

 

 

 

 

 

 

 

 

Overview

The Financial Sector (Shareholdings) Act 1998 was enacted by the Australian Parliament to address the problem of unacceptable shareholding situations in the financial sector. It provides a framework for the Treasurer to approve or disapprove shareholdings in financial sector companies, ensuring that no individual or group holds a stake that could potentially compromise the stability and integrity of the financial system. The Act aims to maintain public confidence in the financial sector by preventing the accumulation of excessive control over financial institutions. The legislation empowers the Treasurer to grant approvals for shareholdings over 15% in financial sector companies, subject to conditions that are considered in the national interest. This specific instrument grants approval to several entities, including Fidelity National Financial, Inc., Stewart Information Services Corporation, S Hold Co LLC, and Stewart Title Guaranty Company, to hold significant stakes in various financial sector companies, contingent upon certain conditions being met.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 applies to any person or entity seeking to hold a stake exceeding 15% in a financial sector company, as defined under the Act. The Act's jurisdiction extends across the Commonwealth of Australia, affecting any entities involved in transactions or shareholdings within the financial sector. Approval under section 14 of the Act is required for such holdings, and the Treasurer has the authority to impose, revoke, or vary conditions on these approvals under sections 16 and 17. The Act also includes provisions for flow-on approvals in cases where the approved entity is a holding company for authorised deposit-taking institutions or authorised insurance companies. Offences under the Act, such as creating an unacceptable shareholding situation recklessly, are indictable and subject to penalties up to 400 penalty units for individuals and 2,000 penalty units for corporate bodies, as outlined in section 11 and subsection 4B(3) of the Crimes Act 1914. The Act mandates the Treasurer to notify applicants and affected financial sector companies of any approvals granted and to publish these notices in the Gazette.

Key Provisions

The Financial Sector (Shareholdings) Act 1998, as evidenced by the approval document C2019G00138 (Gazette), permits Fidelity National Financial, Inc. (Fidelity), Stewart Information Services Corporation (SISCO), S Hold Co LLC (S Hold Co), and Stewart Title Guaranty Company (STGC) to hold specific stakes in certain financial sector companies. Under section 14(1) of the Act, the applicants have been granted approval to hold a 100% stake in Stewart Title Limited (STL), with Fidelity, SISCO, and S Hold Co approved to hold a 100% stake in STGC. Fidelity is also approved to hold a 100% stake in SISCO until it merges into S Hold Co, and then Fidelity is approved to hold a 100% stake in S Hold Co from the time of the merger. These approvals are in the national interest and are effective from the date of signing, remaining in force indefinitely. The Act imposes several obligations on the parties involved. The applicants must comply with any conditions or further conditions that the Treasurer may impose or vary under section 16(2) of the Act. They may also apply to the Treasurer to vary the percentage specified in the approval under subsection 17(1) of the Act. Additionally, the Treasurer has the authority to revoke or vary any conditions imposed under section 16(2) of the Act or specified in the Notice of Approval. The Treasurer can exercise these powers either on their own initiative or in response to an application made by the person holding the approval, as outlined in subsection 16(4) of the Act. Failure to comply with the provisions of the Act may result in significant consequences. Under section 11 of the Act, a person or group of persons is guilty of an offence if they acquire shares in a company and the acquisition leads to an unacceptable shareholding situation in relation to a financial sector company. This offence is considered an indictable offence, and a maximum penalty of 400 penalty units applies, or 2,000 penalty units for a body corporate, as stated in subsection 4B(3) of the Crimes Act 1914. Furthermore, under section 32(3) of the Act, the Federal Court may grant an injunction restraining a person from engaging in conduct that contravenes a condition to which an approval under section 14 is subject, and may require the person to do something if it is deemed desirable by the court.

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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.