Companies Regulations (Amendment) - Legislation

EXPLANATORY STATEMENT

STATUTORY RULES NO. 316/83

Issued by the authority of the Attorney-General

Companies Regulations (Amendment)

1. On 22 December 1978 the Commonwealth and the States executed a Formal 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 industry in the six States and the Australian Capital Territory.

2. Under clause 32 of the Formal Agreement, the National Companies and Securities Commission (‘the NCSC’) is to have responsibility for the entire area of policy and administration with respect to company law and the regulation of the securities industry, subject to directions by the Ministerial Council for Companies and Securities. The Ministerial Council consists of Commonwealth and State Ministers responsible for administering the law relating to companies and the regulation of the securities industry (Formal Agreement, clauses 19 and 20).

3. The Companies Act 1981 (‘the Act’) provides a law in relation to the formation and regulation of companies and other bodies in the Australian Capital Territory.

4. Sub-section 577(1) of the Act provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing all matters that are required or

permitted by the Act to be prescribed by regulations or necessary or convenient to be prescribed by regulations for carrying out or giving effect to the Act. Sub-section 577(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.

5. Under sub-clause 45(1) of the Formal Agreement, the Ministerial Council may consider a proposal for the amendment of regulations made under the Commonwealth Acts enacted for the purposes of the co-operative scheme. Should the Ministerial Council approve any draft amending regulation which gives effect to such a proposal, the Commonwealth is then required, under sub-clause 45(2) of the Agreement, to submit the draft regulation to the Federal Executive Council for making by the Governor-General.

6. The accompanying regulations are in accordance with the draft Companies Regulations (Amendment) approved by the Ministerial Council.

7. The purpose of the accompanying regulations is to make amendments to the Companies Regulations (‘the Regulations’) the majority of which are consequential on amendments to the Act by the Companies and Securities Legislation (Miscellaneous Amendments) Act 1983 (‘the 1983 Act’).

8. The amendments and their purposes are as follows:

Regulation 1 - Commencement

9. The Companies Regulations (Amendment) shall come into operation on 1 January 1984. The provisions of the 1983 Act (other than Part I of the 1983 Act) are expected to be

proclaimed to come into operation on the same date. Sub-section 2(1) of the 1983 Act provides that Part I of the 1983 Act (Preliminary) shall come into operation on the day on which the 1983 Act receives the Royal Assent.

10. The accompanying regulations are expressed to be made in pursuance of section 4 of the Acts Interpretation Act 1901. That section provides that where an Act that does not come into operation immediately upon its enactment amends another Act in such a manner that the other Act, as amended, will confer power to make regulations then, unless the contrary intention appears, that power may be exercised before the amending Act comes into operation. Any regulations made in pursuance of that power take effect on the day on which the amending Act comes into operation or on the day on which the regulations would have taken effect if the amending Act had been in operation when the regulations were made, whichever is the later.

Regulation 2 - Definition of “authorized trustee corporation”

11. Regulation 14 of the Regulations lists those bodies corporate which are prescribed for the purposes of the definition of “authorized trustee corporation” in sub-section 5(1) of the Act.

12. Regulation 14 of the Regulations is amended by re-positioning a paragraph within Regulation 14 of the Regulations so that the body corporate listed in that paragraph appears in alphabetical order.

Regulation 3 - Declared stock exchanges for the purposes of the Act and Schedule 9

Regulation 4 - Prescribed stock exchanges for the purposes of sub-clause 7(5) of Schedule 7

13. Regulation 15 of the Regulations prescribes stock exchanges for the purposes of the definition of “stock exchange” in sub-section 5(1) of the Act. Regulation 16 of the Regulations prescribes stock exchanges for the purposes of sub-clause 7(5) of Schedule 7 to the Regulations.

14. References in Regulations 15 and 16 of the Regulations to the Hobart Stock Exchange are replaced by references to the Hobart Stock Exchange Limited. The Hobart Stock Exchange Limited, a company limited by guarantee, has taken over the operation of the stock exchange in Hobart which was previously conducted by a body corporate incorporated under the Hobart Stock Exchange Act 1891 and known as the Hobart Stock Exchange.

Regulation 5 - Repeal of regulation 27 and substitution of new Part

15. Section 29 of the 1983 Act repeals section 27 of the Act which contains provisions relating to the cancellation or suspension of the registration of auditors, liquidators, liquidators of specified corporations and official liquidators.

16. As a consequence of the repeal of section 27 of the Act, Regulation 27 of the Regulations, which sets out time limits for appeals under sub-sections 27(26) and 27(27) of the Act, is repealed.

17. Section 31 of the 1983 Act inserts a new Subdivision in Division 2 of Part II of the Act entitled “Subdivision B - Cancellation or Suspension of Registration”. This new Subdivision, which contains new sections 30A to 30S of the Act, is in substance an expanded re-enactment of section 27 of the Act.

18. A new Part IIA of the Regulations is substituted for the purposes of certain provisions within the new Subdivision B of Division 2 of Part II of the Act. New Part IIA of the Regulations, entitled “Part IIA - Companies Auditors and Liquidators Disciplinary Board” contains new Regulations 27, 27A and 27B.

19. New Regulation 27 of the Regulations entitles a person who attends at a hearing of the Companies Auditors and Liquidators Disciplinary Board (‘the Board’) pursuant to a summons to such allowances and expenses as are allowed by the Chairman of the Board in accordance with the scale in the new Schedule 3A to the Regulations (as inserted by Regulation 15 of the Companies Regulations (Amendment)). This new regulation is based on Regulation 9 of the National Companies and Securities Commission Regulations.

20. New Regulation 27A of the Regulations prescribes the manner in which a summons to appear before the Board shall be served. This new regulation is based on Sub-Regulation 10(2) of the National Companies and Securities Commission Regulations.

21. New Regulation 27B of the Regulations prescribes, for the purposes of new sub-sections 30R(1) and 30R(2) of the Act, the period within which the NCSC or a person aggrieved by a decision of the Board may appeal to the Court in respect of a decision of the Board.

Regulation 6 - Insertion of new Regulation 54A - Prescribed authorities for the purposes of sub-section 227(3)

22. Section 227 of the Act provides that certain persons are prohibited, without the leave of the Supreme Court, from being a director or promoter of, or from being in any way

concerned in or taking part in the management of a corporation. This prohibition extends to persons convicted of offences set out in sub-section 227(2) of the Act. The period during which a person convicted of such an offence is subject to this prohibition is 5 years from the date of conviction or from the date of release from prison.

23. Sub-section 227(3) of the Act provides that in any proceeding for an offence against sub-section 227(2) of the Act, a certificate by a prescribed authority stating that a person was released from prison on a specified date is prima facie evidence that that person was released from prison on that date.

24. The purpose of new Regulation 54A of the Regulations is to prescribe authorities which may issue certificates for the purposes of sub-section 227(3) of the Act.

Regulation 7 - Certified copies of reports

25. Section 98 of the 1983 Act inserts a new sub-section 328(1) of the Act. Under new sub-paragraph 328(1)(c)(i) of the Act, a receiver of property of a company or a registered foreign company is required to lodge with the NCSC a copy of a report as to affairs of the company or registered foreign company.

26. Paragraph 64(a) of the Regulations provides that a copy of a report lodged with the NCSC for the purposes of sub-paragraph 328(1)(c)(i) of the Act shall be certified in writing to be a true copy of the original by the receiver of the property or part of the property of the company.

27. Paragraph 64(a) of the Regulations is amended:-

(a) to reflect a change in drafting style implemented throughout the Act by the 1983 Act whereby references to a receiver of the property or part of the property of a company, registered foreign company or corporation are replaced by references to a receiver of property of a company, registered foreign company or corporation; and

(b) to replace the reference to “the company” with a reference to “the company or registered foreign company” to reflect the applicability of new sub-section 328(1) of the Act to both a receiver of a company and a registered foreign company.

Regulation 8 - Repeal of Part IX and substitution of new Part IX - Payments, Deposits and Deliveries by Liquidator

28. Section 380 of the Act sets out provisions dealing with the payment of money into a bank by a liquidator in Court windings up. Part IX of the Regulations contains regulations dealing with payments into and out of banks by liquidators in voluntary windings up.

29. Section 108 of the 1983 Act repeals section 380 of the Act. Section 112 of the 1983 Act inserts a new section 421A of the Act which specifically authorizes the Regulations to contain provisions relating to matters dealt with in section 380 of the Act and in Part IX of the Regulations.

30. Part IX of the Regulations, “Payments into and out of banks by liquidators in voluntary windings up” is repealed and replaced by a new Part IX, “Payments, Deposits and Deliveries

by Liquidator”. New Part IX of the Regulations, which applies to liquidators in both Court and voluntary windings up, is based on the repealed Part IX of the Regulations.

Regulation 9 - Quorum

31. Sub-Regulation 88(1) of the Regulations (which is of application to certain meetings) provides that a meeting is restricted as to the business with which it may deal unless there are present, in person or by proxy, at least two persons who are entitled to vote.

32. Sub-Regulation 88(1) of the Regulations is amended so as to take into account the situation where there is only one person entitled to vote at a meeting.

Regulation 10 - Repeal of Regulation 138 and substitution of new Regulation 138 - Time allowed for dealing with formal proofs of debt or claim

33. Regulation 138 of the Regulations sets out the time in which a liquidator is required to deal with formal proofs of debt or claim.

34. Regulation 138 of the Regulations is repealed and a new Regulation 138 is substituted.

35. New Regulation 138 of the Regulations (which also sets out the time in which a liquidator is required to deal with formal proofs of debt or claim):-

(a) requires the liquidator to give notice of his decision to the creditor who submitted the proof of debt or claim;

(b) replaces the reference to the situation where a liquidator does not give notice of his decision in accordance with paragraph 138(1)(a) or (b) with a more appropriate wording (such reference was considered inappropriate as paragraphs 138(1)(a) and (b) do not deal with the giving of notice); and

(c) sets out more clearly the obligations imposed upon a liquidator where he requires further evidence in support of a proof of debt or claim.

Regulation 11 - Postponement of declaration

36. Regulation 141 of the Regulations imposes an obligation on a liquidator to publish a fresh notice of his intention to declare a dividend where the declaration of a dividend is postponed beyond the date of publication of the original notice of intention to declare a dividend.

37. Regulation 141 of the Regulations is amended to make it clear that the obligation on a liquidator to publish a further notice of his intention to declare a dividend is imposed when the liquidator postpones the declaration of a dividend beyond the date specified in the original notice of intention to declare a dividend and not when the declaration of a dividend is postponed beyond the date of publication of the original notice.

Regulation 12 - Insertion of new Regulation 148 - Prescribed offences and penalties

38. Section 121 of the 1983 Act inserts a new section 570A of the Act which establishes a penalty notice system under which minor breaches of the companies legislation may be dealt with by means of a penalty notice rather than having the matter dealt with by a court.

39. Section 124 of the 1983 Act inserts a new sub-section 577(7) of the Act which provides that the Regulations may prescribe certain offences for the purposes of the penalty notice system and shall prescribe the penalty payable pursuant to a penalty notice in respect of each prescribed offence.

40. New Regulation 148 of the Regulations provides that for the purposes of new section 570A of the Act, a prescribed offence is an offence committed under or in relation to a provision of the Act which is specified in new Schedule 10 to the Regulations (as inserted by Regulation 19 of the Companies Regulations (Amendment)).

41. New Regulation 148 of the Regulations also provides that the prescribed penalty applicable to each prescribed offence is also specified in new Schedule 10 to the Regulations.

Regulation 13 - Repeal of Schedule 1 and substitution of new Schedule 1 - List of Forms

42. Schedule 1 to the Regulations lists and describes the forms prescribed in Schedule 2 to the Regulations and specifies the provisions of the Act or the Regulations for the purposes of which the forms are prescribed.

43. Schedule 1 to the Regulations is repealed and replaced with a new Schedule 1 entitled ‘List of Forms’.

44. New Schedule 1 to the Regulations lists each form prescribed in Schedule 2 to the Regulations under every provision of the Act for the purposes of which it is prescribed. This change in format will make it easier to determine which forms are prescribed for the purposes of particular provisions of the Act.

Regulation 14 - Schedule 3

45. Section 76 of the 1983 Act inserts a new section 261 into the Act (Power of company to obtain information as to beneficial ownership of its shares) under which a company is required to keep a register of the information received pursuant to notices given under the section.

46. Items 1 and 3 of Schedule 3 to the Regulations prescribe amounts for inspection of registers and for the supply of copies of certain documents.

47. Schedule 3 to the Regulations is amended to extend the operation of Items 1 and 3 of Schedule 3 to a register kept pursuant to new section 261 of the Act.

Regulation 15 - Schedule 3A

48. A new Schedule 3A to the Regulations, is inserted into the Regulations entitled “Companies Auditors and Liquidators Disciplinary Board - Payments for Attendance”.

49. New Schedule 3A to the Regulations, which is based on Schedule 2 to the National Companies and Securities Commission Regulations, sets out the allowances and expenses which may be paid to a person summonsed to attend at a hearing before the Companies Auditors and Liquidators Disciplinary Board.

Regulation 16 - Schedule 4

50. Section 49 of the 1983 Act inserts a new sub-section 117(1) of the Act which sets out the information required to be disclosed in a prospectus or in a statement lodged with the NCSC where a company makes a payment of brokerage or commission.

51. Schedule 4 to the Regulations (Prospectuses) is amended by omitting clause 10 and substituting new clauses 10 and 10A which are consistent with the wording of new sub-section 117(1) of the Act.

Regulation 17 - Schedule 6

52. Schedule 6 to the Regulations (Statement required pursuant to section 170 of the Act) sets out the matters and reports required to be contained in a statement required pursuant to section 170 of the Act.

53. Schedule 6 to the Regulations is amended to take account of amendments to the prescribed interests provisions of the Act implemented in the 1983 Act. Schedule 6 to the Regulations is amended:-

(a) to recognize that the trustee or representative for the purposes of an approved deed may not have a registered office (sub-section 167(1) of the Act is amended by section 62 of the 1983 Act so that the NCSC may grant its approval to a person (not just a company) acting as trustee or representative for the purposes of a deed);

(b) to take account of the fact that a management company may not have a registered office and may not have directors (the new definition of “company” inserted into sub-section 164(1) of the Act by section 59 of the 1983 Act provides that a body corporate may be declared by the NCSC to be a company for the purposes of Part IV, Division 6 of the Act or corresponding provisions of a law of a State or Territory, so that a management company need not necessarily be a ‘company’ in its normal sense);

(c) to take account of the omission of the specific exempting power of the NCSC in sub-section 176(1) of the Act by section 66 of the 1983 Act and the insertion of new section 215C of the Act by section 68 of the 1983 Act under which the NCSC may exempt a person from compliance with all or any of the provisions of Part IV, Division 6 of the Act (Prescribed Interests); and

(d) to delete certain words which were regarded as superfluous.

Regulation 18 - Schedule 7

54. Section 49 of the 1983 Act inserts a new sub-section 117(1) of the Act which sets out the information required to be disclosed in a prospectus or in a statement lodged with the NCSC where a company makes a payment of brokerage or commission.

55. Schedule 7 to the Regulations (Accounts and group accounts) is amended to bring its wording into line with new sub-section 117(1) of the Act.

Regulation 19 - Schedule 10

56. A new Schedule 10 to the Regulations entitled “Prescribed Offences - Provisions and Penalties” is inserted. New Schedule 10 to the Regulations sets out, for the purposes new section 570A of the Act (which is inserted by section 121 of the 1983 Act and establishes a penalty notice system) and new Regulation 148 of the Regulations (as inserted by Regulation 12 of the Companies Regulations (Amendment)), the

provisions of the Act under or in relation to which a prescribed offence for the purposes of the penalty notice system may be committed and the prescribed penalty in respect of each prescribed offence.

Regulation 20 - Schedule of amendments

57. Part 1 of the Schedule to the Companies Regulations (Amendment) amends Schedule 2 to the Regulations and Part 2 of the Schedule to the Companies Regulations (Amendment) further amends the Regulations.

Regulation 21 - Transitional

58. Section 29 of the 1983 Act repeals section 27 of the Act which contains provisions relating to the cancellation or suspension of the registration of auditors, liquidators, liquidators of specified corporations and official liquidators.

59. As a consequence of the repeal of section 27 of the Act, Regulation 27 of the Regulations, which sets out time limits for appeals under sub-sections 27(26) and 27(27) of the Act, is also repealed by Regulation 5 of the Companies Regulations (Amendment).

60. However, repealed Regulation 27 of the Regulations will continue to apply for the purposes of sub-sections 27(26) and 27(27) of the Act as continued in effect by the new section 30S of the Act (as inserted by section 31 of the 1983 Act).

Schedule

Part 1

Amendments of Schedule 2

Clauses 1, 2, 5, 6, 7

61. Form 2 of the Regulations (Application for registration *as an auditor *and *as a liquidator) sets out the form of application for registration as an auditor and a liquidator. Form 3 of the Regulations (Application for registration as a liquidator of a specified corporation) sets out the form of application for registration as a liquidator of a specified corporation. Form 11 of the Regulations (Notice of a prohibition under section 227, or under section 562 or a corresponding provision of the law of a State or Territory) sets out the form of notice required to be lodged by an auditor, liquidator, or liquidator of a specified corporation where he becomes subject to a prohibition under section 227 of the Act, or under section 562 of the Act or a corresponding provision of the law of a State or Territory. Form 12 of the Regulations (Triennial statement lodged by auditor *and liquidator in respect of the period……19… to ……19…) sets out the form of triennial statement required to be lodged by an auditor or a liquidator. Form 13 of the Regulations (Statement by liquidator of specified corporation for the period ……19…to ……19…) sets out the form of a statement which the NCSC may require a liquidator of a specified corporation to lodge.

62. Forms 2, 3, 12 and 13 of the Regulations are amended and Form 11 of the Regulations is omitted and a new Form 11 is substituted. New Form 11 of the Regulations (which is based on omitted Form 11 of the Regulations) and the amendments to Forms 2, 3, 12 and 13 of the Regulations:-

(a) require particulars of a section 227A order (new section 227A of the Act is inserted by section 70 of the 1983 Act and new sub-section 5(8B) of the Act, as inserted by section 21 of the 1983 Act, sets out the circumstances in which a person shall be taken to be or become subject to a section 227A order);

(b) achieve consistency in the details required to be supplied in relation to a section 227 prohibition (new sub-section 5(8A) of the Act, as inserted by section 21 of the 1983 Act, sets out the circumstances in which a person shall be taken to be or become subject to a section 227 prohibition); and

(c) achieve consistency in the details required to be supplied in relation to a section 562 order (new sub-section 5(8C) of the Act, as inserted by section 21 of the 1983 Act, sets out the circumstances in which a person shall be taken to be or become subject to a section 562 order) ; and

(d) achieve consistency of expression with new sub-sections 5(8A), 5(8B), 5(8C), 18(3), 20(4) and 25(4) of the Act (as inserted by sections 21, 24, 25 and 28 of the 1983 Act).

63. In addition, Forms 2, 3, 12 and 13 of the Regulations are amended to make provision for a person to consent to any police force providing information as to whether the person has been convicted of any offence other than a traffic offence.

Clause 3

64. Form 9 of the Regulations (Particulars of cessation or change relating to a person registered as * an auditor * and * a liquidator, not being the liquidator of a specified corporation) is amended so as to make provision for a request for cancellation of registration as an auditor, liquidator and an official liquidator to be made.

Clause 4

65. Form 10 of the Regulations (Particulars of cessation or change relating to a liquidator of a specified corporation) is amended so as to make provision for a request for cancellation of registration as a liquidator of a specified corporation to be made.

Clause 8

66. A new Form 13A of the Regulations (Summons to appear before Companies Auditors and Liquidators Disciplinary Board) is inserted in the Regulations.

67. New Form 13A of the Regulations makes provision for a person to be summonsed to appear before the Companies Auditors and Liquidators Disciplinary Board to give evidence and to produce documents.

Clause 9

68. Form 20 of the Regulations (Notice by company or registered foreign company for the purposes of section 59 or 61) is omitted and a new Form 20 is substituted.

69. Under new Form 20 of the Regulations (which is based on omitted Form 20 of the Regulations) a company or registered

foreign company, when giving notice that it desires to have its name registered in a State or another Territory pursuant to section 59 of the Act, is also required to state the nature of the principal business carried on by the company or registered foreign company.

Clause 10

70. Form 30 of the Regulations (Report as to affairs) sets out the form of report as to affairs of a company which is prescribed for the purposes of sub-paragraph 83(2)(b)(ii), paragraph 328(1)(b) and sub-sections 329(1), 335(4), 347(5), 375(1) and 398(5) of the Act.

71. Section 98 of the 1983 Act inserts a new sub-section 328(1) of the Act which refers to a registered foreign company as well as to a company.

72. Form 30 of the Regulations is amended to take account of the fact that it may be used as a report as to affairs of a registered foreign company as well as a report as to affairs of a company, and that a receiver may be receiver of property of a company or a registered foreign company.

Clause 11

73. Form 32 of the Regulations (Application by recognized company for registration as a company) sets out the form of application by a recognized company for registration as a company which is prescribed for the purposes of paragraph 84(2)(a) of the Act.

74. Form 32 of the Regulations (other than the directions to that form) is omitted and a new Form 32 is substituted. New Form 32 of the Regulations (which is based on omitted Form 32 of the Regulations):-

(a) replaces inappropriate references to “company” with references to “corporation”;

(b) reflects a change in drafting style implemented by the 1983 Act throughout the Act whereby references to a receiver of the property or part of the property of a company, registered foreign company or corporation are replaced by references to a receiver of property of a company, registered foreign company or corporation; and

Clause 12

75. Form 37 of the Regulations (Statement of payment in relation to subscription for shares) sets out the form of statement which is prescribed for the purposes of paragraph 117(1) (c) of the Act.

76. Paragraph 117(1)(c) of the Act provides that a company may make a payment to a person in consideration of his subscribing or agreeing to subscriber whether absolutely or conditionally, for shares in the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for shares in the company only if certain conditions are fulfilled. One of these conditions, which is set out in paragraph 117(1)(c) of the Act, is that the amount or rate of the payment is disclosed in the prospectus in respect of the shares, or, if there is no such prospectus, in a statement lodged with the NCSC before the company becomes liable to make the payment.

77. Section 49 of the 1983 Act amends section 117 of the Act by substituting new sub-sections 117(1) and (2).

78. The principal changes contained in new sub-sections 117(1) and (2) of the Act are as follows:-

(a) the words “make a payment” are replaced by the words “make a payment by way of brokerage or commission” in order to make it clear that these are the only payments authorized by the section; and

(b) new sub-section 117(2) of the Act makes it clear that a payment of brokerage or commission in respect of shares in the company is not permitted by the section, if it, or if the total amount of other such payments made in respect of those shares together with the proposed payment exceeds 10% of the total of the amount payable in respect of the shares upon their allotment or such amount as is authorized by the articles, whichever is the lesser.

79. Form 37 of the Regulations is omitted and new Form 37 is substituted. New Form 37 of the Regulations (which is based on omitted Form 37 of the Regulations) takes account of the changes implemented in new sub-sections 117(1) and (2) of the Act.

Clause 13

80. The definition of “company” for the purposes of Part IV, Division 6 of the Act in sub-section 164(1) of the Act is omitted and replaced with a new definition of “company” by section 59 of the 1983 Act.

81. The new definition of “company” includes, in relation to a prescribed interest that relates to an undertaking, scheme, enterprise, contract or arrangement, a body corporate declared by the NCSC to be a company for the purposes of Part IV, Division 6 of the Act or corresponding provisions of the law of a State or Territory. As a result of this new definition, a management company need not necessarily be a ‘company’ in its normal sense.

82. Form 46 of the Regulations (Return by management company) sets out the form of return which is prescribed for the purposes of sub-section 173(1) of the Act.

83. Form 46 of the Regulations is amended:-

(a) by omitting the word “Limited” to take account of the fact that a management company may not necessarily have the word “Limited” at the end of its name;

(b) to take account of the fact that a management company may not necessarily have directors, a secretary or a principal executive officer; and

(c) by omitting the reference in paragraph 4 of the form to a Certificate, as the form contains no certificate of relevance to the subject matter of this paragraph.

Clause 14

84. Sub-section 238(9) of the Act provides that the NCSC may require a person to lodge with the NCSC a notice stating whether the person is or has ceased to be a director, principal executive officer or secretary of a company.

85. Schedule 1 to the 1983 Act amends sub-section 238(9) of the Act to make it clear that a company may have only one principal executive officer.

86. Form 62 of the Regulations (Notice as to the holding of office in a company) sets out the form of notice that is required to be lodged with the NCSC pursuant to sub-section 238(9) of the Act.

87. Accordingly, Form 62 of the Regulations is amended to make it clear that a company may have only one principal executive officer.

Clause 15

88. Paragraph 239(3) (d) of the Act requires the statutory report of a company to state the names, addresses and descriptions of the directors, trustees for holders of debentures (if any), auditors (if any), principal executive officers and secretaries of the company.

89. Schedule 1 to the 1983 Act amends paragraph 239(3) (d) of the Act to make it clear that a company may have only one principal executive officer.

90. Form 64 of the Regulations (Statutory report of ……… Limited) sets out the form of the statutory report referred to in sub-section 239(3) of the Act.

91. Accordingly, Form 64 of the Regulations is amended to make it clear that a company may have only one principal executive officer.

Clause 16

92. Section 76 of the 1983 Act inserts a new section 261 of the Act (Power of company to obtain information as to beneficial ownership of its shares). Three new forms are inserted in the Regulations for the purposes of new section 261 of the Act.

93. New Form 65A of the Regulations (Notice under sub-section 261(2) requiring statement of relevant interest) enables a company to require a holder of voting shares to furnish it with full particulars of any relevant interests in those shares.

94. New Form 65B of the Regulations (Notice requiring company to give notice under sub-section 261(2)) enables the NCSC or 5% of the shareholders in a company to require that company to give a Form 65A notice to specified holders of voting shares.

95. New Form 65C of the Regulations (Notice under sub-section 261(3) requiring statement of relevant interest) enables a company that has received information that another person has a relevant interest in shares to require that person to furnish it with full particulars of any relevant interests in those shares.

Clause 17

96. Section 265 of the Act provides that a public company which has more than 500 members, keeps its principal share register in the Territory and within 25 kilometres of the office of the Corporate Affairs Commission for the Territory and provides reasonable access to its list of members and its

particulars of shares transferred, is not required to include a list of members in its annual return if the secretary includes in the return a certificate that the company is one to which sub-section 265(1) of the Act applies.

97. Section 77 of the 1983 Act inserts a new sub-section 265(1A) of the Act which provides that a company limited by guarantee, being a company the memorandum or articles of which prohibit the payment of any dividend to its members, is exempted from having to provide a list of members with its annual return.

98. The exemption granted in new sub-section 265(1A) of the Act to companies limited by guarantee could not be of any application in the context of Form 66 of the Regulations (Annual return of a company having share capital). Therefore, Form 66 of the Regulations is amended to make it clear that the only provision within section 265 of the Act under which a company having share capital may be exempted from the requirement to include a list of members in its annual return is sub-section 265(1) of the Act.

99. Form 66 of the Regulations is also amended:-

(a) to require information regarding the date on which the previous annual general meeting was held rather than requiring the previous period in respect of which an annual return has been lodged to be stated, in order that it may be ascertained whether the company has held its annual general meeting within the required period;

(b) to make it clear that the directors’ report is required to be lodged with the annual return of the company;

(d) to ensure that particulars of directorships held by a director in other corporations that under the law of a State or Territory (including the local jurisdiction) are public companies or subsidiaries of public companies are required to be inserted in the list of directors, principal executive officer, secretaries and auditors.

100. Certain amendments of a formal nature are also implemented in relation to Form 66 of the Regulations.

Clause 18

101. Form 67 of the Regulations (Annual return of a company not having share capital) is amended:-

(a) to remove references which are of application to proprietary companies on the basis that such references are inappropriate in the context of this form as only a company having share capital may be incorporated as a proprietary company;

(b) to remove the reference to a no liability company in the form on the basis that such a reference is inappropriate in the context of a form relating to a company not having share capital;

(c) to require information regarding the date on which the previous annual general meeting was held rather than requiring information regarding the previous period in respect of which an

annual return has been lodged in order that it may be ascertained whether the company has held its annual general meeting within the required period;

(d) to make it clear that the directors’ report is required to be lodged with the annual return of the company;

(e) to make it clear that a company may be exempted from the requirement to include a list of members in its annual return under sub-section 265(1) of the Act or new sub-section 265(1A) of the Act, as inserted by section 77 of the 1983 Act;

(f) to omit paragraph (6) of the form and to substitute a new paragraph (6) which incorporates the following changes:-

(i) references to sections 278 and 279 of the Act are omitted - these provisions are of application to proprietary companies so that references to them in the context of a form to be completed by a company not having share capital are inappropriate;

(ii) new footnote (5) makes it clear that particulars of directorships held by a director in other corporations which, under the law of a State or Territory (including the local jurisdiction), are public companies or subsidiaries of public companies are required to be

inserted in the list of directors, principal executive officer, secretaries and auditors; and

(iii) references to Christian or given names and surnames are replaced by references to surnames and other names; and

(g) to omit the certificate headed “B. CERTIFICATE FOR INCLUSION IN PUBLIC COMPANY’S ANNUAL RETURN THAT DOES NOT INCLUDE LIST OF MEMBERS” and to substitute a new certificate headed “B. CERTIFICATE FOR INCLUSION IN ANNUAL RETURN THAT DOES NOT INCLUDE LIST OF MEMBERS” which is of application where a company is exempted from the requirement to include a list of members in its annual return pursuant to sub-section 265(1) of the Act or new sub-section 265(1A) of the Act as inserted by section 77 of the 1983 Act.

Clause 19

102. Section 282 of the Act provides that an auditor of a company may be removed from office by resolution of the company at a general meeting of which special notice has been given or he may, subject to having received the consent of the NCSC, resign. Sub-sections 282(5) and (13) of the Act require the company to give notice of an auditor’s resignation or removal to the NCSC and, in the case of a borrowing corporation, a copy of the notice is required to be given to the trustee for the holders of debentures.

103. Section 84 of the 1983 Act omits sub-sections 282(5) and (13) of the Act and inserts a new sub-section 282(13) of the Act which provides that a company is required to lodge

with the NCSC a notice in the prescribed form of an auditor’s resignation or removal from office within 14 days of the auditor’s resignation or removal. New paragraph 282(13)(d) of the Act provides that where there is a trustee for debenture holders, the company is required to give the trustee a copy of the notice lodged with the NCSC.

104. Form 70 of the Regulations (Notice of resignation or removal of auditor) sets out the form of a notice of resignation or removal of an auditor or auditors which is required to be lodged pursuant to section 282 of the Act.

105. The direction to Form 70 of the Regulations is amended to bring its wording into line with new paragraph 282(13)(d) of the Act.

Clause 20

106. An officer of a corporation, the affairs of which are being investigated under Part VII of the Act, is guilty of an offence pursuant to sub-section 296(2) of the Act, if, without reasonable excuse, he refuses or fails to comply with a requirement of an inspector under section 295 of the Act.

107. An inspector may, pursuant to sub-section 295(3) of the Act, also require a person to produce books in his custody or control, where the inspector has reasonable grounds to believe that the books may be relevant to his investigation.

108. A person (not being an officer of the corporation) who fails to comply with a requirement made by an inspector under sub-section 295(3) of the Act is not guilty of an offence under sub-section 296(2) of the Act.

109. Sub-section 296(2) of the Act is amended by section 86 of the 1983 Act to provide that a person who, without reasonable excuse, refuses or fails to comply with a requirement of an inspector under section 295 of the Act shall be guilty of an offence.

110. Form 72 of the Regulations (Notice requiring the production of books relevant to the affairs of a corporation) is prescribed for the purposes of sub-section 295(3) of the Act.

111. A new direction in Form 72 of the Regulations is inserted so as to draw attention to the widened applicability of the penalty provision in sub-section 296(2) of the Act.

Clause 21

112. Form 78 of the Regulations (Notice of appointment of *receiver/*receiver and manager of ……… Limited) is prescribed for the purposes of sub-section 326(1) of the Act.

113. Form 78 of the Regulations is amended:-

(a) to take account of a drafting change implemented by the 1983 Act throughout the Act whereby references to a receiver of the property or part of the property of a company, registered foreign company or corporation are replaced by references to a receiver of property of a company, registered foreign company or corporation; and

(b) to take account of the fact that new sub-section 326(1) of the Act (as inserted by section 96 of the 1983 Act) refers to both a receiver of property of a company or a registered foreign company.

Clause 22

114. Form 79 of the Regulations (Notice of address of office of *receiver/*receiver and manager) sets out the form of a notice which is prescribed for the purposes of sub-section 326(1A) of the Act.

115. Form 79 of the Regulations is omitted and a new Form 79 is substituted. New Form 79 of the Regulations (which is based on omitted Form 79 of the Regulations):-

(a) takes account of a drafting change implemented by the 1983 Act throughout the Act whereby references to a receiver of the property or part of the property of a company, registered foreign company or corporation are replaced by references to a receiver of property of a company, registered foreign company or corporation;

(b) refers to both a receiver of property of a company or a registered foreign company in accordance with the wording of sub-section 326(1A) of the Act; and

Clause 23

116. Form 80 of the Regulations (Notice of change in situation of office of *receiver/*receiver and manager) sets out the form of a notice prescribed for the purposes of sub-section 326(1A) of the Act.

117. Form 80 of the Regulations is amended:-

(b) so as to refer to both a receiver of property of a company or a registered foreign company in accordance with the wording of sub-section 326 (1A) of the Act.

Clause 24

118. Form 81 of the Regulations (Notice by *receiver/*receiver and manager ceasing to act) sets out the form of a notice prescribed for the purposes of sub-section 326(2) of the Act.

119. Form 81 of the Regulations is amended:-

(b) so as to refer to both a receiver of property of a company or a registered foreign company in accordance with the wording of new sub-section 326(2) of the Act (as inserted by section 96 of the 1983 Act).

Clause 25

120. Sub-section 342(1) of the Act provides that the official manager of a company is required to convene six-monthly meetings of creditors and members to consider the statement and report he is required to prepare in relation to the company. Within 7 days of such a meeting the official manager is required, pursuant to sub-section 342(6) of the Act, to lodge with the NCSC a notice of the holding of the meeting and a copy of each statement and report laid before the creditors and members at the meeting.

121. However, where there is no meeting held through lack of a quorum, there is no requirement to lodge with the NCSC a notice of the holding of the meeting and a copy of the statement and report prepared in accordance with sub-section 342(1) of the Act.

122. Section 106 of the 1983 Act inserts a new sub-section 342(6A) of the Act which provides that if a quorum is not present at a meeting convened in accordance with sub-section 342(1) of the Act, the official manager is required to lodge with the NCSC within 7 days after the day for which the meeting was convened, or, if the meeting was adjourned and no quorum is present at the adjourned meeting, within 7 days after the day to which the meeting was adjourned:-

(a) a notice stating that the meeting was duly convened and no quorum was present or that the

meeting was duly convened and adjourned and that no quorum was present at the adjourned meeting; and

(b) a copy of the statement and of the report prepared for the purpose of that meeting.

123. Form 90 of the Regulations (Notice by official manager of holding of six-monthly meeting) sets out the form of notice required to be lodged with the NCSC pursuant to sub-section 342(6) of the Act.

124. Form 90 of the Regulations is omitted and a new Form 90 is substituted. New Form 90 of the Regulations is based on omitted Form 90 of the Regulations but may be utilized in the circumstances described in both sub-section 342(6) of the Act and new sub-section 342(6A) of the Act (as inserted by section 106 of the 1983 Act).

Clause 26

125. Sub-section 515(2) of the Act provides that where certain changes or alterations are made in relation to a registered foreign company (such as its constituent documents, directors, agents, name or registered office in the place of incorporation) the NCSC is required to be notified within one month of the change.

126. Section 116 of the 1983 Act amends the requirement in paragraph 515(2)(b) of the Act to notify any change in the directors of a registered foreign company so that it extends to any change in the directors, members of the committee of management, council or other governing body of a registered foreign company.

127. Section 116 of the 1983 Act also amends the requirement in paragraph 515(2)(d) of the Act to notify any change in the situation of the registered office of the registered foreign company in its place of incorporation or formation so that where the registered foreign company has no registered office in its place of incorporation or formation, it is required to notify any change in the situation of its principal place of business in its place of incorporation or formation.

128. Form 113 of the Regulations (Return by foreign company giving particulars of directors or members of other governing body and changes of particulars) sets out the form of a return for the purposes of paragraphs 512(2)(c) and 515(2)(b) of the Act.

129. Form 113 of the Regulations is omitted and a new Form 113 is substituted. New Form 113 of the Regulations (which is based on omitted Form 113 of the Regulations):-

(a) incorporates a new heading which reflects more closely the wording of paragraph 512(2)(c) of the Act and new paragraph 515(2)(b) of the Act (as inserted by section 116 of the 1983 Act);

(b) indicates the classes of persons who may sign the form;

(c) in its application to corporate directors, requires, in footnote (2) of the form, the address of the registered office or principal place of business in the place of incorporation or formation to be stated, consistent with the wording of new paragraph 515(2)(d) of the Act (as inserted by section 116 of the 1983 Act); and

(d) replaces references to Christian or given name and surname with references to surname and other names.

Clause 27

130. Form 121 of the Regulations (Statement in writing verifying balance-sheet, profit and loss account, &c., of foreign company) sets out the form of statement required to be lodged with the NCSC pursuant to sub-section 516(1) of the Act.

131. Form 121 of the Regulations is amended:-

(a) to require the place of incorporation or formation of the foreign company to be stated;

(b) to require the names of the participating States or participating Territories in which the name of the foreign company is registered to be stated in order that the correct fee on lodgment of the balance sheet and profit and loss account may be calculated; and

(c) to require the addresses of the principal offices (if any) of the foreign company in the respective participating States or participating Territories to be stated.

Clause 28

132. Form 122 of the Regulations (Annual return of foreign company) sets out the form of an annual return which certain registered foreign companies are required to lodge with the NCSC pursuant to sub-section 516(8) of the Act.

133. Form 122 of the Regulations is amended:-

(a) to require the names of the participating States or participating Territories in which the name of the company is registered to be stated in order that the correct fee on lodgment of the annual return may be calculated;

(b) to require the addresses of the principal offices (if any) of the company in the respective participating States or participating Territories to be stated;

(c) by omitting paragraph (5) and substituting a new paragraph (5) which caters for situations where members of the management body of the registered foreign company are not known as “directors” and replaces a reference to Christian or given names and surnames with a reference to surnames and other names; and

(d) by omitting footnote (3) and substituting a new footnote (3) which takes account of the situation where a foreign company has a principal place of business rather than a registered office in its place of incorporation or formation.

Clause 29

134. Form 127 of the Regulations (List of persons present at meeting of (1) ……… of ……… Limited) sets out the form of a list of persons present in person or by proxy at certain meetings. Form 127 of the Regulations is prescribed pursuant to Sub-Regulation 99(2) of the Regulations and paragraph 577(1)(d) of the Act.

135. Form 127 of the Regulations is omitted and a new Form 127 is substituted. New Form 127 of the Regulations (which is based on omitted Form 127 of the Regulations):-

(a) makes provision for holders of debentures to insert the amount of debentures held in the company;

(b) incorporates an expanded footnote (1) which also applies to a meeting of a committee of inspection; and

(c) makes it clear in footnote (2) that the requirement to insert the amount of proof lodged or debentures held does not apply in the case of a meeting of a committee of inspection.

Clause 30

136. Sub-section 547(1) of the Act provides that a company is required keep certain registers at its registered office or its principal place of business in the Territory except in certain circumstances, in which case it may keep the registers at another office or place.

137. Sub-section 547(2) of the Act provides that a company is required to keep certain branch registers at its principal office or its principal place of business in the relevant State or Territory except in certain circumstances, in which case it may keep the branch registers at another office or place.

138. Section 118 of the 1983 Act amends section 547 of the Act to:-

(a) extend the operation of sub-section 547(1) of the Act to the register required to be kept by a company under new section 261 of the Act (as inserted by section 76 of the 1983 Act); and

(b) make it clear that a register or branch register to which section 547 of the Act applies must always be kept at an office.

139. Form 152 of the Regulations (Notice of place other than registered or principal office at which register or branch register is kept) sets out the form of a notice which is required to be lodged pursuant to sub-section 547(4) of the Act.

140. Form 152 of the Regulations is amended:-

(a) by changing the heading to the form to recognize that a relevant register or branch register may only be kept at an office rather than a “place” and that it is possible for the form to be used for notification that a register or branch register is located in the registered or principal office;

(b) by expanding footnote (1) to the form to encompass a register of information received pursuant to notices given under new section 261 of the Act; and

(c) by omitting footnote (2) to the form and substituting a new footnote (2) which makes specific reference to the requirements of section 530A of the Act (Address of registered office, principal office, &c).

Clause 31

141. Section 121 of the 1983 Act inserts a new section 570A of the Act which establishes a penalty notice system whereby minor breaches of the companies legislation may be dealt with by means of a penalty notice rather than having the matter taken to court.

142. New Form 154 of the Regulations (Penalty notice), which sets out the form of a penalty notice:-

(a) contains an allegation of the commission of an offence prescribed for the purposes of the penalty notice system;

(b) sets out the prescribed penalty in respect of the prescribed offence;

(d) sets out the manner in which an alleged offender may dispose of the matter by way of the penalty notice system rather than by having the matter taken to court; and

(e) outlines the possible consequences of failure to comply with the penalty notice.

Schedule

Part 2

Further amendments

143. Part 2 of the Schedule (Further amendments) contains several amendments to the Regulations which are of a formal nature.

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