ASIC Stapling Relief (Stara Venu CCIV) Instrument 2023/124

Overview

The ASIC Stapling Relief (Stara Venu CCIV) Instrument 2023/124, made by Kate Metz, a delegate of the Australian Securities and Investments Commission, was introduced to address the specific issues faced by the Stara Venu CCIV in relation to the transfer of stapled securities. This notifiable instrument was enacted to modify the duties of directors and officers of the CCIV under Part 8B.3 of the Corporations Act 2001, ensuring that these duties are adapted to the unique structure of stapled securities. The instrument aims to provide clarity and relief to the directors and officers of the Stara Venu CCIV by tailoring the regulatory framework to accommodate the characteristics of stapled securities, thus facilitating compliance and governance within this specific corporate structure. The instrument is made under the authority of paragraph 1243(2)(b) of the Corporations Act 2001 and commenced on the day following its registration on the Federal Register of Legislation.

Scope and Application

The ASIC Stapling Relief (Stara Venu CCIV) Instrument 2023/124I, made under the authority of the Corporations Act 2001, applies specifically to the Stara Venu CCIV, which comprises the Stara Venu Business Sub-Fund and the Stara Venu Property Sub-Fund. This instrument modifies the duties of directors and officers of the CCIV, specifically addressing the obligations related to stapled securities. It comes into effect on the day after its registration on the Federal Register of Legislation. The instrument is designed to ensure that directors and officers of the CCIV consider whether shares referable to the sub-funds are stapled securities when discharging their duties. The modified duties apply only if each share referable to the Stara Venu Property Sub-Fund and each share referable to the Stara Venu Business Sub-Fund can only be transferred together and if these are the only sub-funds of the Stara Venu CCIV. This targeted approach aims to provide relief to the CCIV by clarifying and adjusting specific legal requirements relating to stapled securities within its structure.

Key Provisions

The ASIC Stapling Relief (Stara Venu CCIV) Instrument 2023/124 (the "Instrument") modifies the duties of directors and officers of the Stara Venu CCIV, a company with a stapled structure, under the Corporations Act 2001 (the "Act"). This is achieved by applying Part 8B.3 of the Act to the Stara Venu CCIV with certain modifications. Specifically, section 5(1) of the Instrument alters the duties of directors and officers of the Stara Venu CCIV by requiring them to consider whether shares referable to the sub-funds of the CCIV are stapled securities when making decisions (section 1224C(2)(c) and 1224D(1)(c) of the Act). The Instrument imposes obligations on the directors and officers of the Stara Venu CCIV to take into account whether shares referable to the sub-funds of the CCIV are stapled securities when performing their duties. This means that in addition to the existing duties, directors and officers must consider the implications of stapled securities on their decision-making processes. The Instrument also includes a definition of "stapled securities" for the purposes of sections 1224C and 1224D of the Act. A "stapled security" is a share referable to a sub-fund of a CCIV, where the share can only be transferred together with a share referable to another sub-fund of the CCIV and there are no shares in the same class as the shares referable to either sub-fund which may be transferred separately (section 5(1)(d) of the Instrument). The Instrument specifies that the modified duties of directors and officers of the Stara Venu CCIV apply where each share referable to the Stara Venu Property Sub-Fund and each share referable to the Stara Venu Business Sub-Fund may only be transferred together, and the only sub-funds of the Stara Venu CCIV are the Stara Venu Property Sub-Fund and the Stara Venu Business Sub-Fund (section 5(2) of the Instrument). Failure to comply with the modified duties of directors and officers of the Stara Venu CCIV under the Instrument may result in civil or criminal consequences under the Act. The maximum penalties for contraventions of the Act can include fines and imprisonment, depending on the nature and severity of the breach. However, the Instrument itself does not specify any particular penalties for non-compliance.