EXPLANATORY STATEMENT
STATUTORY RULES 1985 NO.228
ISSUED BY THE AUTHORITY OF THE MINISTER OF STATE FOR RESOURCES AND ENERGY FOR AND ON BEHALF OF THE ATTORNEY-GENERAL
COMPANIES REGULATIONS (AMENDMENT)
Section 577 of the Companies Act 1981 (“the Act”) provides in sub -section (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. 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 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 industry in the six States and the Australian Capital Territory.
3. Under sub-clause 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 sub-clause 45(2) of the agreement, to submit the draft regulation to the Federal Executive Council for making by the Governor-General.
4. The accompanying regulation is consistent with a resolution passed by a majority of members of the Council.
5. The purpose of the regulation is to amend regulation 14 of the Companies Regulations (“the Regulations”) to declare “ANZ Executors and Trustee Company (South Australia) Limited” and “Westpac Custodian Nominees Limited” to each be an “authorized trustee corporation”.
6. Sub-section 5(1) of the Act provides that, unless the contrary intention appears, “authorized trustee corporation” means a body corporate that is declared by the Regulations to be an “authorized trustee corporation”. Section 192 of the Act provides that in respect of a transfer of marketable securities by an “authorized trustee corporation” to the beneficial owner of the marketable securities, a simplified instrument of transfer may be used. Regulation 14 of the Regulations lists those bodies corporate declared to be an “authorized trustee corporation” for the purposes of the Act.
7. As a consequence of the Council’s decision to approve the declaration of ANZ Executors and Trustee Company (South Australia) Limited as an “authorized trustee corporation” for the purposes of the Act, regulation 14 of the Regulations will be amended by inserting a new paragraph (ae) declaring ANZ Executors and Trustee Company (South Australia) Limited to be an “authorized trustee corporation”.
8. As a consequence of the Council’s decision to approve the declaration of Westpac Custodian Nominees Limited as an “authorized trustee corporation” for the purposes of the Act, regulation 14 of the Regulations will be amended by inserting a new paragraph (zma) declaring Westpac Custodian Nominees Limited to be an “authorized trustee corporation”.
Overview
The Companies Regulations (Amendment) Statutory Rules 1985 No. 228, issued by the Minister of State for Resources and Energy on behalf of the Attorney-General, aims to amend the Companies Regulations 1981 to declare ANZ Executors and Trustee Company (South Australia) Limited and Westpac Custodian Nominees Limited as authorised trustee corporations. This regulation is consistent with a resolution passed by the Ministerial Council for Companies and Securities, which was established under an agreement between the Commonwealth and the States to provide a cooperative Commonwealth-State scheme for a uniform system of law and administration in relation to company law and the regulation of the securities industry. The Council approved the draft amending regulation, which was then submitted to the Federal Executive Council for making by the Governor-General. The policy objective of the regulation is to simplify the transfer of marketable securities by allowing a simplified instrument of transfer when the transfer is made by an authorised trustee corporation.
The regulation is necessary to carry out and give effect to the Companies Act 1981, which provides that the Governor-General may make regulations not inconsistent with the Act. Regulation 14 of the Companies Regulations lists the bodies corporate declared to be authorised trustee corporations for the purposes of the Act. By inserting new paragraphs (ae) and (zma) in regulation 14, ANZ Executors and Trustee Company (South Australia) Limited and Westpac Custodian Nominees Limited will be declared as authorised trustee corporations, which will allow them to use a simplified instrument of transfer when transferring marketable securities to the beneficial owner. This amendment to the Companies Regulations aims to streamline the process of transferring marketable securities and improve efficiency in the securities industry.
Scope and Application
The Companies Regulations (Amendment) Statutory Rules 1985 No. 228, made under the authority of the Minister of State for Resources and Energy and on behalf of the Attorney-General, pertain to the amendment of the Companies Regulations to declare ANZ Executors and Trustee Company (South Australia) Limited and Westpac Custodian Nominees Limited as "authorized trustee corporations". This Act applies to these two specified companies, allowing them to act as authorized trustee corporations in accordance with the Companies Act 1981. The jurisdictional reach of these regulations extends to the Commonwealth, and they are made in accordance with the Ministerial Council for Companies and Securities established under an agreement between the Commonwealth and the States. The regulations are consistent with resolutions passed by the majority of Council members and are intended to simplify the transfer of marketable securities by these corporations. There are no stated exclusions or exemptions within the scope of this particular regulation, and it operates as a direct amendment to the existing Companies Regulations.
Key Provisions
The Companies Regulations (Amendment) Statutory Rules 1985 No. 228 (the "Regulations") amends the Companies Regulations (the "Regulations") by adding two new entries under regulation 14. These amendments follow the Ministerial Council for Companies and Securities' approval, under sub-clause 45(1) of the agreement, to declare ANZ Executors and Trustee Company (South Australia) Limited and Westpac Custodian Nominees Limited as "authorized trustee corporations" under section 5(1) of the Companies Act 1981 ("the Act"). The insertion of new paragraphs (ae) and (zma) in regulation 14 lists these companies as authorised trustee corporations, enabling them to use a simplified instrument of transfer when transferring marketable securities to beneficial owners as provided in section 192 of the Act.
The Regulations impose specific obligations on ANZ Executors and Trustee Company (South Australia) Limited and Westpac Custodian Nominees Limited, now recognised as "authorized trustee corporations." These obligations include the use of a simplified instrument of transfer when transferring marketable securities to beneficial owners, as per section 192 of the Act. This recognition allows these entities to engage in activities that require the use of simplified instruments of transfer, facilitating the transfer of securities in a streamlined manner. Both companies must ensure compliance with the Act and the Regulations, maintaining records and processes that align with their new status.
The Act does not specify particular offences or penalties for breaches of the Regulations. However, breaches of the Companies Act or any associated regulations may result in civil or criminal penalties under other sections of the Act. For instance, non-compliance with the Act can lead to fines or imprisonment. The severity of penalties will depend on the nature and extent of the breach, with potential fines reaching up to $210,000 for companies and imprisonment for up to five years for individuals, as provided by section 1317E of the Act. Additionally, directors and officers may be held personally liable for breaches of their duties, potentially facing fines and disqualification from managing corporations.