EXPLANATORY STATEMENT
Issued by authority of the Treasurer
Corporations Amendment (Simple Corporate Bonds and Other Measures) Act 2014
Corporations Amendment (Simple Corporate Bonds and Other Measures) Commencement Proclamation 2014
Item 2 of the table in subsection 2(1) of the Corporations Amendment (Simple Corporate Bonds and Other Measures) Act 2014 (Act) provides that Schedule 1 to the Act commences on the earlier of a day to be fixed by Proclamation or the day six months after the day the Act received the Royal Assent. The Act received the Royal Assent on 11 September 2014.
The Proclamation fixes 19 December 2014 as the day on which Schedule 1 to the Act commences.
The Act amends the Corporations Act 2001 to promote increased issuance of retail corporate bonds in Australia.
Schedule 1 to the Act introduces a framework for a streamlined disclosure regime, through a 2-part prospectus, for issuances of simple corporate bonds. While the Act sets out the framework of the 2-part prospectus material, the structure and content of the 2-part prospectus material is specified by the regulations contained in the Corporations Amendment (Simple Corporate Bonds and Other Measures) Regulation 2014. The Corporations Amendment (Simple Corporate Bonds and Other Measures) Regulation 2014 commences upon commencement of Schedule 1 to the Act.
Schedule 1 to the Act also reduces the liability risk directors have when a company issues simple corporate bonds. It provides directors greater clarity on the steps required as part of the due diligence process, and removes the deemed civil and criminal liabilities in respect of misleading and deceptive statements and omissions.
Schedule 1 to the Act also establishes a framework to enable parallel trading of simple corporate bonds in the wholesale and retail markets by inserting definitions for depository interests and depository nominees.
The start date gives effect to the Government’s pre-election commitment to give priority to the recommendations of the Johnson Report into Australia as a financial centre.
The Proclamation is a legislative instrument for the purposes of the Legislative Instruments Act 2003.