Approval to hold a stake in a financial sector company of more than 20% - 86400 Holdings Pty Ltd

Administered by Department of the Treasury

Legislation au C2019G00671 In force Gazette

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Approval to hold a stake in a financial sector company of more than 20%

Financial Sector (Shareholdings) Act 1998

 

SINCE:

 

A. 86400 Holdings Pty Ltd ABN 36 621 802 097 (the applicant) has applied to the Treasurer under section 13 of the Financial Sector (Shareholdings) Act 1998 (the Act) for approval to hold a 100% stake in 86400 Ltd ABN 13 621 804 813 (the company), which is a financial sector company under the Act; and
 

B. I am satisfied that it is in the national interest to approve the applicant holding a stake in the company of more than 20%,

 

 

I, Brandon Khoo, a delegate of the Treasurer, under paragraph 14(1)(a) of the Act, APPROVE the applicant holding a 100% stake in the company.

 

This approval has effect from the date it is signed and remains in force indefinitely.

 

 

Dated:    18 July 2019

 

[Signe]

 

 

 

…………………

Brandon Khoo

Executive General Manager

Diversified Institutions Division


Interpretation

In this Schedule:

 

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 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.  Under subsection 19(1), if an Approval has been granted for the holding of a stake in a financial sector company that 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. Under subsection 19(3), if an Approval has been granted for a company to hold a stake in a financial sector company there is taken to be in force at that time an approval for each officer of the company to hold the same percentage stake in the financial sector 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.

 

 

Overview

The Financial Sector (Shareholdings) Act 1998 was enacted to regulate and control shareholdings in financial sector companies, addressing the problem of excessive concentration of ownership and control within the financial sector. This Act empowers the Treasurer to approve or disapprove shareholdings exceeding 20% in financial sector companies, ensuring the stability and integrity of Australia's financial institutions. The policy objective underpinning the Act is to safeguard the national interest by preventing any single entity or group from gaining undue influence over critical financial services. Enacted by the Parliament of Australia, the Act allows for the imposition, variation, and revocation of conditions on shareholding approvals, providing a flexible framework to adapt to changing circumstances while maintaining oversight of significant shareholdings in the financial sector.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 applies to entities and individuals who seek to acquire or hold a stake in a financial sector company, ensuring such stakes do not exceed certain thresholds without prior approval from the Treasurer. This Act is applicable on a Commonwealth level and governs the acquisition and holding of stakes in financial sector companies, defined under the Act. The Act also allows the Treasurer to impose conditions on, vary, or revoke approvals under specific circumstances, thereby extending its application through subordinate instruments. The Act specifies certain exclusions and thresholds, such as the 20% stake limit, which triggers the requirement for approval. An unacceptable shareholding situation is defined under the Act, and any acquisition that results in such a situation without approval is considered an offence, with penalties applicable for individuals and corporate bodies. This legislative framework is crucial for maintaining the stability and integrity of Australia's financial sector.

Key Provisions

The main sections of the Financial Sector (Shareholdings) Act 1998 relevant to this approval are sections 13, 14, and 16. Section 13 allows an applicant to seek approval from the Treasurer to hold a stake in a financial sector company that exceeds 20%. Section 14 provides the mechanism by which the Treasurer can grant such approval, subject to conditions, and section 16 outlines the Treasurer's power to impose conditions, vary conditions, or revoke the approval. In this instance, the delegate of the Treasurer has approved the applicant's 100% stake in the company, which is considered a financial sector company under the Act. The obligations and requirements imposed by the Act on the parties involved include the necessity for the applicant to apply for approval before holding a stake exceeding 20% in a financial sector company. The Treasurer must provide written notice of the approval to the applicant and the company concerned and publish a copy of the notice in the Gazette. Additionally, the Act stipulates that the approval may be subject to conditions, and these conditions can be imposed, varied, or revoked by the Treasurer. The Treasurer also has the authority to vary the percentage specified in the approval if deemed to be in the national interest. Under the Act, several offences and penalties are associated with breaches. Section 11 of the Act outlines the criminal liability for individuals or groups who acquire shares in a company and thereby create or increase an unacceptable shareholding situation in a financial sector company, if they act recklessly. This offence carries a maximum penalty of 400 penalty units for individuals, or 2,000 penalty units for bodies corporate. Furthermore, section 39 of the Act specifies that an offence under section 11 is an indictable offence, meaning it is tried in a higher court before a judge and jury. The Act also provides mechanisms for the Treasurer to manage and regulate shareholdings through conditions and approvals, ensuring compliance with national interests.

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Area of Law
Financial Sector Regulation
Instrument
Gazette Notice
Concepts
Definitions & Interpretation
Offence Provisions
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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.