STATUTORY RULES.
1940. No. 115.
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REGULATION UNDER THE NATIONAL SECURITY ACT 1939.*
I, THE GOVERNOR-GENERAL in and over the Commonwealth of Australia, acting with the advice of the Federal Executive Council, hereby make the following Regulation under the National Security Act 1939.
Dated this twenty-first day of June, 1940.
GOWRIE
Governor-General.
By His Excellency’s Command,
PERCY C. SPENDER
for and on behalf of the Minister of State for Defence Co-ordination.
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Amendment of the National Security (Capital Issues) Regulations.†
Consent of Treasurer.
Regulation 10 of the National Security (Capital Issues) Regulations is amended by adding at the end thereof the following sub-regulations:—
“(3.) The Treasurer may refuse to grant any consent under any provision of these Regulations until there are first executed such agreements (including agreements with persons other than the applicant for the consent) with the Treasurer relating to the transaction in respect of which consent is applied for as the Treasurer requires.
“(4.) Any agreement under the last preceding sub-regulation—
(a) may provide for the payment of a sum of money, whether by way of liquidated damages, penalty or otherwise, for the breach or non-performance thereof and for the taking of security for the payment of any such sum; and
(b) shall not be held to be void on the ground of any want of consideration therefor, and the parties thereto shall have, in all Courts, the same rights and remedies as if the agreement had been supported by valuable consideration”.
* Notified in the Commonwealth Gazette on 24th June, 1940.
† Statutory Rules 1939, No. 149, as amended by Statutory Rules 1939, No. 162; 1940, No. 56; and 1940, No. 83.
By Authority: L. F. Johnston, Commonwealth Government Printer, Canberra.
3931.—Price 3d.
Overview
The Statutory Rules 1940 No. 115, under the National Security Act 1939, was enacted to amend the National Security (Capital Issues) Regulations, specifically addressing the need for additional oversight and control over capital issues during a time of national security concern. This regulation, made by the Governor-General in Council, seeks to empower the Treasurer to refuse consent for capital transactions until certain agreements are in place. These agreements may include provisions for penalties in the event of breach and can be enforced in courts despite the absence of consideration, ensuring the Treasurer's ability to regulate capital issues effectively in the interest of national security.
The policy objective of this regulation is to provide the Treasurer with the necessary tools to manage and monitor capital issues during a critical period, thereby safeguarding national interests and maintaining economic stability. The enactment body, the Federal Executive Council, aimed to bolster the regulatory framework in response to emerging threats by enhancing the Treasurer's authority to control capital transactions.
Scope and Application
The Statutory Rules of 1940, No. 115, made under the National Security Act 1939, amend the National Security (Capital Issues) Regulations, specifically Regulation 10. This legislation applies to any entity or individual seeking consent from the Treasurer for capital issues during the period of the regulations. The amendment is intended to enhance the control and oversight of capital issues in the context of national security, allowing the Treasurer to impose conditions on such consent. This regulation applies to all entities and individuals within the Commonwealth of Australia and can be enforced nationwide. The amendment grants the Treasurer the authority to require agreements before granting consent for capital issues, including the ability to enforce penalties for non-performance or breach of these agreements. These agreements can include provisions for liquidated damages, penalties, or security for payment, and they are legally binding regardless of the consideration present. The regulation extends its reach through subordinate instruments, ensuring that the Treasurer's discretion is robust and adaptable to the needs of national security during this period.
Key Provisions
The Statutory Rules 1940 No. 115 under the National Security Act 1939 introduce specific amendments to the National Security (Capital Issues) Regulations. Regulation 10 is particularly amended by adding two new sub-regulations (3 and 4) (10(3) and 10(4)). Sub-regulation 10(3) allows the Treasurer to withhold consent for any capital issue until the applicant has executed the necessary agreements with the Treasurer. These agreements could involve third parties and must cover the specific transaction in question. This amendment gives the Treasurer significant control over capital transactions that may impact national security.
These amendments impose specific obligations on the parties involved in capital issues. Primarily, applicants for consent under these regulations must execute agreements with the Treasurer that meet the Treasurer’s requirements. These agreements can include provisions for financial penalties or liquidated damages in case of non-performance or breach, and they may also allow for the taking of security to ensure compliance. Importantly, these agreements will be upheld in court regardless of whether they appear to lack consideration, meaning they will be legally binding (10(4)(a) and (b)).
Breaches of the agreements stipulated in these new sub-regulations may have serious legal consequences. Although specific offences and penalties are not detailed in the statutory rules, breaches of such agreements could potentially lead to civil actions for damages or enforcement of financial penalties as agreed upon in the contract. Additionally, the failure to adhere to the agreements might indirectly contravene the National Security Act 1939, leading to further legal ramifications. The exact penalties would depend on the terms of the individual agreements and any applicable laws.