EXPLANATORY STATEMENT
STATUTORY RULES 198 NO 208
ISSUED BY THE AUTHORITY OF THE TREASURER
BANKS (SHAREHOLDINGS) ACT 1972
BANKS (SHAREHOLDINGS) REGULATIONS (AMENDMENT)
Section 10 of the Banks (Shareholdings) Act 1972 (the Act) generally limited the nominal amount of the voting shares of a bank incorporated in Australia in which a person (including a corporation) may have an interest to 10 per cent of the total nominal amount of the voting shares of the bank, or 15 per cent with an exemption from the Treasurer.
David Jones Limited (DJL), owned as to 45.1 per cent by the Adelaide Steamship Company Limited (Adsteam), applied to the Treasurer for exemptions from compliance with the 10 per cent limit in sub-section 10(1), so as to allow it to increase its holding of voting shares in National Australia Bank Limited (NAB) from 9.8 to 15 per cent. The Treasurer has granted to DJL, Adsteam a number of other persons owning shares in DJL and the relevant officers of the companies concerned with the requested exemptions pursuant to sub-sections 10(2) and 10(2B) since he has seen no objection in the national interest to doing so.
Under section 9 of the Act the associates (such as affiliates and subsidiaries) of the above companies are deemed to have the same interest in NAB as the companies themselves. These associates could represent a large and ever-changing group of persons (both natural persons and corporations). Rather than attempt to list them and make specific exemptions from time to time, pursuant to sub-section 10(2), it is convenient to prescribe these interests as provided for by section 17 and paragraph 8(9)(d).
Paragraph 8(9)(d) of the Act provides that a prescribed interest in a share that is an interest of such person, or of the persons included in such class of persons, as is prescribed shall be disregarded. The Banks (Shareholdings) Regulations (the Regulations) currently prescribe interests in shares in the banks listed at one place in the Schedule to the Regulations, and prescribe classes of persons who are associates of shareholders listed at another place in the Schedule and whose interests are deemed to exist only by virtue of sub-section 9(2) of the Act, that is by virtue of an associate relationship.
The amending regulation has added a class of persons - the associates of the companies and natural persons in the Adsteam group listed below, other than the relevant officers of the companies concerned - in respect of their associates interests in voting shares in NAB. The effect of such a regulation is that such interests on the part of associates of these persons are disregarded for the purposes of the Act, although the restriction remains that DJL, Adsteam and the other persons listed below will not be able to acquire through associates an interest in more than 15 per cent of voting shares in NAB without contravening the Act.
Detail of the regulation is as follows:
The Schedule to the Banks (Shareholdings) Regulations is amended by adding the following corporations and natural persons to the Schedule in relation to National Australia Bank Limited.
• Georges of Melbourne Pty Ltd
• David Jones Limited
• The Adelaide Steamship Company Limited
• Adsteam Finance & Investments Pty Ltd
• M.J. Kent
• B.L. Walsh
• K.W. Russell
• J.G. Spalvins
• National Consolidated Limited
• Australian Inhibitor Paper Pty Ltd
• Fawldapp Pty Ltd
• Westall Pty Ltd
• D.P.S. Nominees Pty Ltd
• J.A. Duncan
• David Jones Ltd Special Staff Superannuation Plan
• Trustees of David Jones Employees Provident Fund
• Buckleys Provident Fund Securities Pty Ltd
• R.J. Aird
• Chakra Pty Ltd
• J.O. Curry
• K.B. Timms