EXPLANATORY STATEMENT
STATUTORY RULES 1987 NO. 148
ISSUED BY THE AUTHORITY OF THE ATTORNEY-GENERAL
COMPANIES (ACQUISITION OF SHARES REGULATIONS (AMENDMENT)
Section 62 of the Companies (Acquisition of Shares) Act 1980 (“the Act”) provides in subsection (1) that the Governor-General may make regulations, not inconsistent with the Act, prescribing all matters that are necessary or convenient to be prescribed for carrying out or giving effect to the Act. Subsection 62(2) of the Act provides that the power of the Governor-General to make regulations shall be exercised only in accordance with advice that is consistent with resolutions of the Ministerial Council for Companies and Securities (“the Council”).
2. The Council was established under an agreement between the Commonwealth and the States, executed on 22 December 1978 (“the Agreement”), that provides the framework for a co-operative Commonwealth-State scheme for a uniform system of law and administration in relation to company law and the regulation of the securities and futures industries in the six States, the Australian Capital Territory and the Northern Territory of Australia.
3. Under subclause 45(1) of the Agreement, the Council may consider a proposal for the amendment of regulations made under the Commonwealth Acts enacted for the purpose of the co-operative companies and securities scheme. Should the Council approve any draft amending regulation which gives effect to such a proposal, the Commonwealth is then required,
under subclause 45(2) of the Agreement, to submit the draft regulations to the Federal Executive Council for making by the Governor-General.
4. The accompanying regulations are identical in form and substance to draft regulations approved by the Council.
5. The purpose of the accompanying regulations is to amend the Companies (Acquisition of Shares) Regulations to reflect the establishment of the new Australian Stock Exchange Limited.
6. Details of the accompanying regulations are set out below.
Regulation 1: Commencement
7. The amendments to the Regulations come into operation on 1 July 1987.
Regulation 2: Securities exchanges and stock exchanges declared for the purposes of the Act
8. Under section 6 of the Act “securities exchange” and “stock exchange” are defined as meaning a body corporate that is declared by the Regulations to be a securities exchange or stock exchange (respectively) for the purposes of the Act. Regulation 4 of the Regulations declares each of the capital city stock exchanges to be a securities exchange and a stock exchange for the purposes of the Act.
9. On 1 April 1987 a new stock exchange, the Australian Stock Exchange Limited, was incorporated as a company limited by guarantee under the Australian Stock Exchange and National Guarantee Fund Act 1987. That Act also made the existing capital city exchanges subsidiaries of that Exchange and changed their names to reflect their new status.
10. This regulation inserts in the Regulations a new regulation 4 which declares the Exchange (i.e. the new
Australian Stock Exchange Limited) and each Exchange subsidiary (i.e. the six former capital city stock exchanges) to be a securities exchange and a stock exchange for the purposes of the Act.
Overview
The Companies (Acquisition of Shares) Regulations (Amendment) 1987 was enacted to address the need for updating the regulatory framework in response to the establishment of the Australian Stock Exchange Limited. The original Companies (Acquisition of Shares) Act 1980, which allows the Governor-General to make regulations for carrying out or giving effect to the Act, was amended to incorporate the newly formed Australian Stock Exchange Limited. The policy objective of this regulation was to ensure that the new exchange and its subsidiaries were properly recognised within the existing legal framework. The regulations were issued in accordance with advice consistent with resolutions of the Ministerial Council for Companies and Securities, established under an agreement between the Commonwealth and the States to provide a uniform system of law and administration in relation to company law and securities regulation. These regulations came into operation on 1 July 1987, effectively updating the regulatory definitions to include the Australian Stock Exchange Limited and its subsidiaries as securities exchanges and stock exchanges for the purposes of the Act.
Scope and Application
The Companies (Acquisition of Shares) Regulations (Amendment) Statutory Rules 1987, issued under the authority of the Attorney-General, amend the existing regulations to reflect the establishment of the new Australian Stock Exchange Limited. These regulations apply to the acquisition of shares by companies, and their scope includes both the new Australian Stock Exchange Limited and its subsidiaries, which are the six former capital city stock exchanges. The regulations are designed to ensure that the definition of "securities exchange" and "stock exchange" as per the Companies (Acquisition of Shares) Act 1980, includes these entities. The changes come into effect on 1 July 1987, aligning with the incorporation of the new exchange under the Australian Stock Exchange and National Guarantee Fund Act 1987. This amendment does not specify any exclusions or exemptions, and its application extends across the Commonwealth as per the cooperative scheme for uniform company law and securities regulation. The regulations are made in accordance with advice consistent with resolutions of the Ministerial Council for Companies and Securities, following the established framework for Commonwealth-State collaboration.
Key Provisions
The Companies (Acquisition of Shares) Regulations (Amendment) Statutory Rules 1987 No. 148 sets forth amendments to the Companies (Acquisition of Shares) Regulations, reflecting the establishment of the new Australian Stock Exchange Limited. The regulations, which come into effect on 1 July 1987, are grounded in section 62 of the Companies (Acquisition of Shares) Act 1980, allowing the Governor-General to prescribe necessary matters for the Act’s implementation. Regulation 1 states that the amendments commence on 1 July 1987, while Regulation 2 redefines "securities exchange" and "stock exchange" to include the Australian Stock Exchange Limited and its subsidiaries.
The key obligation imposed by these regulations is the declaration of the Australian Stock Exchange Limited and its subsidiaries as securities exchanges and stock exchanges under the Act. This ensures that the new exchange and its subsidiaries are recognised and regulated entities within the framework of the Act. By inserting a new regulation 4, the amendments bring the regulations up to date, recognising the structural changes within the securities industry, particularly the incorporation of the Australian Stock Exchange Limited and the re-classification of the former capital city exchanges as subsidiaries.
Violation of the requirements set out in these regulations could potentially lead to legal consequences, although specific offences, penalties, or civil/criminal consequences are not explicitly detailed in the provided text. However, given the context of company law and securities regulation, non-compliance could result in actions under the broader legislative framework of the Companies (Acquisition of Shares) Act 1980, which may include fines, corrective actions, or other regulatory measures deemed necessary by the relevant authorities. The exact penalties would be in line with those prescribed by the overarching Act and relevant regulatory standards.