ASIC Corporations (Securities: NZ FASTER System) Instrument 2016/891
About this compilation
Compilation No. 1
This is a compilation of ASIC Corporations (Securities: NZ FASTER System) Instrument 2016/891 as in force on 22 December 2017. It includes any commenced amendment affecting the legislative instrument to that date.
This compilation was prepared by the Australian Securities and Investments Commission.
The notes at the end of this compilation (the endnotes) include information
about amending instruments and the amendment history of each amended provision.
Contents
Part 1—Preliminary
1 Name of legislative instrument
3 Authority
4 Definitions
Part 2—Declaration
5 Issue or transfers of securities covered by New Zealand FASTER system
Endnotes
Endnote 1—Instrument history
Endnote 2—Amendment history
Part 1—Preliminary
1 Name of legislative instrument
This is the ASIC Corporations (Securities: NZ FASTER System) Instrument 2016/891.
3 Authority
This instrument is made under subsection 1075A(1) of the Corporations Act 2001.
4 Definitions
In this instrument:
Act means the Corporations Act 2001.
securities means any of the following:
(a) shares in a company;
(b) debentures of a company;
(c) interests in a registered scheme.
Part 2—Declaration
5 Issue or transfers of securities covered by New Zealand FASTER system
Part 7.11 of the Act applies to securities of a company as if section 1071H were modified by inserting after subsection (5):
“(5A) A company need not comply:
(a) with subsection (1) in relation to the issue of a security; or
(b) with subsection (3) in relation to a transfer of a security;
if:
(c) the security is able to be traded on any of the following financial markets operated by New Zealand Exchange Limited (NZX):
(i) NZX Main Board;
(ii) NZX Debt Market;
(iii) NZX Alternative Market; and
(d) the issue or transfer of the security is covered by the system (the FASTER system) for the electronic transfer of securities operated by NZX known as the “FASTER” system; and
(e) any document required to be sent or delivered to the person to whom the security is issued, or the transferee, under the FASTER system in relation to the issue or the transfer has been sent or delivered.
Note: Subsection (1) requires a company to complete, have ready for delivery and send or deliver to the holder the appropriate certificates or other title documents within 2 months after the company issues a security. A company that has issued securities will be able to rely on this subsection if the requirements of paragraphs (c) to (e) of this subsection are met no later than 2 months after the company issues a security.
Subsection (3) requires a company to complete, have ready for delivery and send or deliver to the transferee the appropriate title and transfer documents within one month after the date on which a transfer of a security is lodged with the company. A company whose securities have been transferred will be able to rely on this subsection if the requirements of paragraphs (c) to (e) of this subsection are met no later than one month after the date on which a transfer of a security is lodged with the company.
(5B) In subsection (5A), a security is able to be traded on a financial market even if, under the terms on which it is to be traded, it must be transferred together with one or more other securities.”.
Endnotes
Endnote 1—Instrument history
Instrument number | Date of FRL registration | Date of commencement | Application, saving or transitional provisions |
2016/891 | 19/9/2016 (see F2016L01485) | 23/9/2016 | |
2017/1119 | 21/12/2017 (see F2017L01696) | 22/12/2017 | - |
Endnote 2—Amendment history
ad. = added or inserted am. = amended LA = Legislation Act 2003 rep. = repealed rs. = repealed and substituted
Provision affected | How affected |
Section 2 | rep. s48D LA |
Section 5 | am. 2017/1119 |
Overview
The ASIC Corporations (Securities: NZ FASTER System) Instrument 2016/891 was enacted to address a specific gap in the Corporations Act 2001, which did not previously accommodate the New Zealand FASTER system for the electronic transfer of securities operated by New Zealand Exchange Limited (NZX). This legislative instrument was created under subsection 1075A(1) of the Corporations Act 2001 by the Australian Securities and Investments Commission (ASIC). The policy objective is to streamline the compliance requirements for companies that issue securities traded on NZX's financial markets, allowing them to rely on the FASTER system for the electronic transfer of securities instead of adhering to the traditional paper-based documentation processes. By integrating the FASTER system, the instrument aims to modernise and simplify the securities issuance and transfer processes, thereby enhancing efficiency and reducing administrative burdens for companies involved in cross-border securities transactions with New Zealand.
Scope and Application
The ASIC Corporations (Securities: NZ FASTER System) Instrument 2016/891 applies to companies that issue or transfer securities which are traded on certain financial markets operated by New Zealand Exchange Limited (NZX). Specifically, it concerns companies whose securities can be traded on the NZX Main Board, NZX Debt Market, or NZX Alternative Market. The instrument modifies the Corporations Act 2001 to provide relief from certain obligations regarding the issue or transfer of securities if these securities are covered by the FASTER system for the electronic transfer of securities operated by NZX. The instrument applies to any company issuing or transferring securities that meet the criteria of being tradeable on the specified NZX markets and covered by the FASTER system, provided that the necessary documents are sent or delivered within the specified timeframes. The instrument does not apply to securities that do not meet these conditions.
Key Provisions
The ASIC Corporations (Securities: NZ FASTER System) Instrument 2016/891, made under subsection 1075A(1) of the Corporations Act 2001, modifies the requirements for issuing and transferring securities of a company. Specifically, section 5A of the Corporations Act 2001 is altered to exempt companies from certain obligations regarding the issue or transfer of securities if those securities can be traded on any of the financial markets operated by New Zealand Exchange Limited (NZX) and if the issue or transfer is covered by the FASTER system for the electronic transfer of securities. This exemption applies provided that any required documents under the FASTER system are sent or delivered within the specified timeframes.
Under the amended provisions, a company is not required to comply with the obligations under subsections (1) and (3) of section 1071H of the Act if the securities are eligible for trading on the NZX Main Board, the NZX Debt Market, or the NZX Alternative Market, and the FASTER system is used for the transfer. Additionally, the document requirements under the FASTER system must be met within two months of issuing the security or one month of lodging the transfer with the company. This means that instead of the usual paper-based delivery of certificates or other title documents, companies can rely on the electronic processes provided by the FASTER system.
The obligations imposed on companies by this legislative instrument include ensuring that securities eligible for trading on the specified NZX markets and covered by the FASTER system comply with the electronic document requirements within the stipulated timeframes. Companies must also ensure that any documents required to be sent or delivered to the person to whom the security is issued or the transferee are indeed sent or delivered through the FASTER system. This includes making sure that all technical and procedural requirements of the FASTER system are adhered to, ensuring the integrity and timeliness of the electronic transfer process.
There are no explicit offences, penalties, or civil/criminal consequences mentioned in the ASIC Corporations (Securities: NZ FASTER System) Instrument 2016/891 itself. However, non-compliance with the Corporations Act 2001 and its associated regulations can lead to significant legal repercussions. For example, if a company fails to meet the document delivery requirements within the specified timeframes, it may be subject to enforcement actions by the Australian Securities and Investments Commission (ASIC). These actions can include administrative penalties, fines, and potential legal proceedings, which can result in substantial financial penalties. The exact penalties would depend on the specific breach and the discretion of the court or regulatory body involved.