Financial Sector (Shareholdings) (Credit Suisse) Instrument 2023
I, Jim Chalmers, Treasurer, make the following instrument.
Dated 10 May 2023
Dr Jim Chalmers
Treasurer
Contents
Part 1—Preliminary
1 Name
2 Commencement
3 Authority
4 Definitions
Part 2—Approvals to exceed 20% shareholding limit
5 Approval of application
Part 1—Preliminary
1 Name
This instrument is the Financial Sector (Shareholdings) (Credit Suisse) Instrument 2023.
2 Commencement
(1) Each provision of this instrument specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information |
Column 1 | Column 2 | Column 3 |
Provisions | Commencement | Date/Details |
1. The whole of this instrument | The day after this instrument is registered. | |
Note: This table relates only to the provisions of this instrument as originally made. It will not be amended to deal with any later amendments of this instrument.
(2) Any information in column 3 of the table is not part of this instrument. Information may be inserted in this column, or information in it may be edited, in any published version of this instrument.
3 Authority
This instrument is made under the Financial Sector (Shareholdings) Act 1998.
4 Definitions
Note: Paragraph 13(1)(b) of the Legislation Act 2003 has the effect that expressions have the same meaning in this instrument as in the Financial Sector (Shareholdings) Act 1998 as in force from time to time.
In this instrument:
ABN has the meaning given by the A New Tax System (Australian Business Number) Act 1999.
the Act means the Financial Sector (Shareholdings) Act 1998.
Part 2—Approvals to exceed 20% shareholding limit
5 Approval of application
(1) Under paragraph 14(1)(a) of the Act, each item of the following table grants approval to the applicant specified in the item:
(a) to hold more than a 20% stake in the financial sector company specified in the item; and
(b) to hold no more of the stake specified in the item in the financial sector company.
Item | Name of applicant | ABN of applicant | Financial sector company | ABN of financial sector company | Approved holding in the financial sector company |
1 | UBS Group AG | | Credit Suisse AG | 17 061 700 712 | 100% |
Note: On 19 March 2023, the UBS Group AG and Credit Suisse Group AG entered into a merger agreement under which the Credit Suisse Group AG will merge, by absorption, with the UBS Group AG in accordance with the federal laws of Switzerland. Following the merger, the UBS Group AG will hold a 100% stake in Credit Suisse AG.
(2) The approval granted under subsection (1) remains in force until repealed or otherwise revoked.
Overview
The Financial Sector (Shareholdings) (Credit Suisse) Instrument 2023 was enacted to address the specific issue of exceeding the 20% shareholding limit in financial sector companies, particularly in the context of the merger between UBS Group AG and Credit Suisse AG. The instrument was made by Jim Chalmers, the Treasurer, under the authority of the Financial Sector (Shareholdings) Act 1998. The primary objective of this instrument is to grant approval for UBS Group AG to hold a 100% stake in Credit Suisse AG, which is a consequence of the merger. This approval is necessary to ensure compliance with Australian financial sector regulations while allowing the merger to proceed. The instrument came into effect on the day following its registration and will remain in force until repealed or otherwise revoked.
Scope and Application
The Financial Sector (Shareholdings) (Credit Suisse) Instrument 2023 is an instrument made under the Financial Sector (Shareholdings) Act 1998, which grants specific approvals for shareholdings in financial sector companies. This particular instrument focuses on approving UBS Group AG to hold a 100% stake in Credit Suisse AG, following the merger between the two entities under Swiss federal laws. The instrument applies to UBS Group AG, identified by its Australian Business Number (ABN), and Credit Suisse AG, which is a financial sector company, as defined under the Act. The instrument's provisions commenced the day after its registration and provide ongoing approval for the specified shareholding arrangement until repealed or revoked. The scope of this instrument is confined to the approval of the stated shareholding limit exception for the involved entities and does not extend to other financial sector companies or different shareholding percentages.
Key Provisions
The Financial Sector (Shareholdings) (Credit Suisse) Instrument 2023 (F2023N00104) outlines specific approvals for exceeding the 20% shareholding limit within the financial sector, particularly concerning Credit Suisse. Section 2 of the instrument details the commencement date, which is the day after the instrument is registered. Section 3 clarifies that this instrument is made under the Financial Sector (Shareholdings) Act 1998. Definitions provided in Section 4 ensure that terms like "ABN" and "the Act" carry the same meanings as they do under the Financial Sector (Shareholdings) Act 1998.
Section 5 of the instrument outlines the approval of applications to hold more than a 20% stake in specified financial sector companies. Specifically, it grants UBS Group AG approval to hold a 100% stake in Credit Suisse AG. This approval is contingent upon the terms set out in the instrument, which aligns with the merger agreement between UBS Group AG and Credit Suisse Group AG that was entered into on 19 March 2023. The approval will remain in effect until it is repealed or revoked. The instrument imposes an obligation on the applicant, UBS Group AG, to adhere to the approved holding limit and to maintain the specified stake in Credit Suisse AG as per the terms outlined.
Breaches of the terms set out in the Financial Sector (Shareholdings) (Credit Suisse) Instrument 2023 could lead to civil or criminal consequences. While specific penalties are not detailed in the instrument, violations of the Financial Sector (Shareholdings) Act 1998, under which this instrument is made, could result in substantial fines and, in severe cases, imprisonment. The precise penalties depend on the nature and severity of the breach, and are subject to the broader legislative framework provided by the Act.