Overview

The Financial Sector (Shareholdings) Act 1998 was enacted to regulate the ownership and control of financial sector companies in Australia. The Act was introduced to address the need for oversight and regulation of significant shareholdings in the financial sector to protect the stability and integrity of the financial system. The Parliament of Australia enacted this legislation to provide a framework for the supervision of substantial shareholdings in financial institutions, ensuring that such holdings do not jeopardise the national financial system. The policy objective of the Act is to maintain and enhance the safety and soundness of the financial sector by controlling and overseeing significant shareholdings. This notifiable instrument, dated 19 November 2025, grants approval to Cuscal Limited to hold a stake of more than 20% in Indue Limited, a financial sector company, following an application under subsection 13(1) of the Act. Peter Diamond, as a delegate of the Treasurer, has approved Cuscal Limited to hold a 100% stake in Indue Limited, deeming it to be in the national interest. This instrument, which will be registered on the Federal Register of Legislation, commences on the date of its creation and remains in force indefinitely. Additionally, the Treasurer or their delegate is mandated to provide a copy of this instrument to Indue Limited. The approval also includes provisions for flow-on approvals as outlined in section 19 of the Act, which applies to subsidiaries and officers of the company where applicable.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 governs the approval of entities seeking to hold a stake exceeding 20% in financial sector companies, with the Act applying to any entity or individual intending to acquire such a stake. The legislation is of Commonwealth reach and applies nationally across Australia. The Act requires entities to seek approval from the Treasurer or a delegate, such as the Australian Prudential Regulation Authority (APRA), before they can hold a significant stake in a financial sector company. This Act provides a mechanism for ensuring that entities acquiring substantial stakes in financial institutions do so in a manner that aligns with national interests. The Act includes provisions for flow-on approvals to subsidiaries and officers of the approved company, ensuring comprehensive coverage of related entities. This legislation does not explicitly outline exclusions or exemptions, thereby applying broadly to all qualifying entities and transactions unless otherwise specified by subordinate instruments.

Key Provisions

This notifiable instrument, F2025N00920, grants Cuscal Limited, ABN 95 087 822 455, the approval to hold a stake of 100% in Indue Limited, ABN 97 087 822 464, under the Financial Sector (Shareholdings) Act 1998. This approval is given by Peter Diamond, as a delegate of the Treasurer, under paragraph 14(1)(a) of the Act. The approval becomes effective from the date it is issued and will remain in force indefinitely. The document also mandates that a copy of this instrument be provided to Indue Limited, as required by section 19 of the Act. Additionally, it outlines provisions for flow-on approvals concerning subsidiaries and officers of the approved company, as stipulated in subsections 19(1) and 19(3) of the Act. Under this instrument, Cuscal Limited is permitted to hold a stake of 100% in Indue Limited, a financial sector company. This permission is contingent on the satisfaction of the Treasurer or their delegate that such approval is in the national interest. The approval process involves an application under subsection 13(1) of the Act, and the decision to approve the shareholding is made in accordance with paragraph 14(1)(a). The instrument ensures that the approval is communicated to the relevant financial sector company and registered on the Federal Register of Legislation. The obligations imposed by this instrument on Cuscal Limited include adherence to the conditions of the approval, maintaining compliance with any additional requirements stipulated by the Treasurer or their delegate, and ensuring that any flow-on approvals are managed as per the provisions of section 19 of the Act. Specifically, if Indue Limited is a holding company of an authorised deposit-taking institution or an authorised insurance company, Cuscal Limited must also manage flow-on approvals for each 100% subsidiary company and for each officer of the company, as per subsections 19(1) and 19(3). Should Cuscal Limited fail to comply with the conditions set out in this instrument, they may face civil or criminal consequences. While the specific penalties are not detailed in the instrument, breaches of provisions under the Financial Sector (Shareholdings) Act 1998 can generally result in significant fines and potential criminal charges. The maximum penalties can vary depending on the nature and severity of the breach, but they can include substantial financial penalties and imprisonment. Therefore, it is crucial for Cuscal Limited to strictly adhere to the terms of this approval to avoid any legal ramifications.