ASIC CLASS ORDER 07/91
EXPLANATORY STATEMENT
Prepared by the Australian Securities and Investments Commission
Corporations Act 2001- Paragraphs 601QA(1)(a) – variation
Paragraph 601QA(1)(a) of the Corporations Act 2001 (the Act) provides that the Australian Securities and Investments Commission (ASIC) may exempt a person from a provision of Chapter 5C of the Act.
1. Background
Paragraph 601FG(1)(a) of the Act provides that the responsible entity of a registered managed investment scheme may acquire and hold an interest in the scheme, but it must only do so:
(a) for not less than the consideration that would be payable if the interest were acquired by another person; and
(b) subject to terms and conditions that would not disadvantage other members.
ASIC Class Order 03/104 Relief facilitating the acquisition and sale of forfeited interests in registered time-sharing schemes (CO 03/104) grants conditional relief from paragraph 601FG(1)(a) of the Act to responsible entities of registered time-sharing schemes to allow them to acquire, hold and dispose of forfeited time-sharing interests.
ASIC has granted relief in [CO 03/104] to assist responsible entities to manage time-sharing schemes more effectively for the benefit of all members. ASIC has imposed conditions on the relief in [CO 03/104] that are designed to:
(a) protect members from unfair methods of acquisition of time-sharing interests through forfeiture;
(b) ensure that forfeited time-sharing interests are sold for a fair and reasonable price;
(c) ensure that the proceeds of sale of forfeited time-sharing interests are distributed equitably; and
(d) assist members understand when their time-sharing interests can be forfeited and their rights with respect to any forfeiture.
2. The Class Order
ASIC Class Order CO 07/91 (CO 07/91) effects amendments to [CO 03/104] that are intended to replace references to the disclosure regime in Chapter 6D of the Act and the transitional disclosure regime in Part 10.2 of the Act, which no longer apply to time-sharing interests, and replace them with references to the disclosure regime in Part 7.9 of the Act, which now applies to time-sharing interests following recent legislative changes.
3. Consultation
ASIC did not consult on the amendments to [CO 03/104] in [CO 07/91], as they are only minor or machinery in nature.