Australian and Overseas Telecommunications Corporation Regulations (Amendment) 1993 No. 9
EXPLANATORY STATEMENT
STATUTORY RULES 1993 No. 9
Issued by the authority of the Minister for Transport and Communications
Australian and Overseas Telecommunications Corporation Act 1991
Australian and Overseas Telecommunications Corporation Regulations (Amendment)
Section 42 of the Australian and Overseas Telecommunications Corporation Act 1991 (the Act) provides that the Governor-General may make regulations for the purposes of the Act.
Subsection 3A(2) of the Act provides that regulations may declare that two or more specified entities are a set of merging entities, that a specified entity is the merged entity and that a specified day is the merger day for the merged entity.
Subsection 3A(1) of the Act made provision for the merger of Telecom and OTC and provides that the Australian and Overseas Telecommunications Corporation (AOTC) is the merged entity arising from the merger, which took place on 1 February 1992. Subsection 3A(2) of the Act deals with the merger of entities other than Telecom and OTC.
The Australian and Overseas Telecommunications Corporation Regulations (Amendment) merge OTC Trunked Radio Systems Pty Limited and AOTC. Paragraph 3A(3) (b) of the Act requires merging entities to consist of AOTC and at least one entity that, immediately before the merger of Telecom and OTC was a wholly-owned subsidiary of Telecom or of OTC. Immediately before the merger, OTC Trunked Radio Systems Pty Limited was a wholly owned subsidiary of OTC.
Under subsection 27 (1) of the Act no tax is payable under a law of the Commonwealth, State or Territory in relation to the merger of Telecom and OTC or the merger of entities for which regulations made under subsection 3A(2) provide. However, paragraph 3A(2) (c) provides that any mergers under subsection 3A(2) must occur within 12 months of the merger of Telecom and OTC. Consequently, to gain a tax neutral merger of entities, the merger must occur within 12 months of 1 February 1992.
For this reason the Regulations set the 31 January 1993 as the date of the merger between OTC Trunked Radio Systems Pty Limited and AOTC.
Details of the proposed Australian and Overseas Telecommunications corporation Regulations are as follows:
Regulation 1 - provides for an amendment to the Australian and Overseas Telecommunications Corporation Regulations.
Regulation 2 - provides that a new regulation 4 be added to previous regulations.
Regulation 2 Para (a) - provides that OTC Trunked Radio Systems Pty Limited and AOTC are a set of merging entities.
Regulation 2 Para (b) - provides that AOTC is the merged entity in relation to the merger.
Regulation 2 Para (c) - provides that 31 January 1993 is the merger day.
Overview
The Australian and Overseas Telecommunications Corporation Regulations (Amendment) 1993 were enacted to facilitate the merger between OTC Trunked Radio Systems Pty Limited and the Australian and Overseas Telecommunications Corporation (AOTC), which arose from the earlier merger of Telecom and OTC on 1 February 1992. The amendments were made under the Australian and Overseas Telecommunications Corporation Act 1991, with the authority of the Minister for Transport and Communications. The principal objective of these regulations was to ensure that the subsequent merger of OTC Trunked Radio Systems Pty Limited and AOTC occurred within the stipulated timeframe to maintain tax neutrality, as required by the Act. The regulations specifically declare OTC Trunked Radio Systems Pty Limited and AOTC as the merging entities, with AOTC as the merged entity, and set 31 January 1993 as the merger day, thereby complying with the legislative requirements for a tax-neutral merger.
Scope and Application
The Australian and Overseas Telecommunications Corporation Regulations (Amendment) 1993 No. 9 applies specifically to the entities of OTC Trunked Radio Systems Pty Limited and the Australian and Overseas Telecommunications Corporation (AOTC). It addresses the regulatory framework for the merger of these entities in accordance with the Australian and Overseas Telecommunications Corporation Act 1991. The Act itself applies to entities involved in telecommunications services within Australia and its territories, and its regulations extend to defining the terms and conditions under which mergers can occur without incurring taxes. The geographic and jurisdictional reach of the Act is national, applying across all states and territories of Australia. The amendment ensures that the merger of OTC Trunked Radio Systems Pty Limited and AOTC is recognised and managed within the legislative framework established by the Act, with specific provisions to ensure that the merger takes place within 12 months of the initial merger of Telecom and OTC to maintain tax neutrality. The amendment specifies the entities involved, the date of the merger, and the resulting merged entity, all of which are subject to the regulatory oversight provided by the Act.
Key Provisions
The key operative sections of the Australian and Overseas Telecommunications Corporation Regulations (Amendment) 1993 No. 9 revolve around the merger of specified entities under the Australian and Overseas Telecommunications Corporation Act 1991 (the Act). Regulation 2 Para (a) identifies OTC Trunked Radio Systems Pty Limited and AOTC as the merging entities, while Regulation 2 Para (b) designates AOTC as the resulting merged entity. Regulation 2 Para (c) sets the merger day as 31 January 1993, ensuring compliance with the 12-month window mandated by subsection 3A(2) of the Act. This amendment allows for a tax-neutral merger, as per subsection 27(1) of the Act.
These regulations impose several obligations and requirements on the entities involved. Primarily, they necessitate that OTC Trunked Radio Systems Pty Limited and AOTC meet the criteria outlined in the Act for being classified as merging entities. This includes ensuring that OTC Trunked Radio Systems Pty Limited was a wholly-owned subsidiary of OTC immediately before the merger with AOTC, as required by paragraph 3A(3)(b) of the Act. Additionally, the regulations require both entities to complete the merger within the specified 12-month period post the merger of Telecom and OTC, which occurred on 1 February 1992.
Failure to comply with the provisions of the Australian and Overseas Telecommunications Corporation Regulations (Amendment) 1993 No. 9 could result in legal consequences. Although the explanatory statement does not detail specific offences or penalties, breaches of regulations under the Act can potentially lead to civil or criminal penalties. These could include fines or other sanctions as prescribed by the Act or other relevant legislation. The exact nature and severity of these penalties would depend on the specific breach and the discretion of the relevant authorities.