Revocation of existing approval and granting of new approval to hold a stake in a financial sector company of more than 15%

Administered by Department of the Treasury

Legislation au C2017G00550 In force Gazette

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Revocation of existing approval and granting of new approval to hold a stake in a financial sector company of more than 15%

Financial Sector (Shareholdings) Act 1998

To: China Minsheng Investment Group Corp. Ltd (P.R. China) (CMIGC) and the person(s) named in the attached Schedule 1 (the applicants); and  

 The persons listed in Schedule 2

 

SINCE 

 

  1. Each of the applicants has applied for approval under section 13 of the Financial Sector (Shareholdings) Act 1998 (the Act), to hold a stake of 100% in:

 

  1. Sirius International Insurance Corporation ABN 26 764 933 001, an authorised insurance company under the Act (the insurer); and
  2. each company which will be both a holding company of the insurer and a 100% subsidiary of the applicant from the time Sirius International UK Holdings Ltd (UK) acquires a 100% stake in the insurer;

 

B.     The applicants other than Sirius International UK Holdings Ltd (UK) have an approval dated 26 February 2016 under subsection 14(1) of the Act to hold a 100% stake in the insurer:

 

  1. however, as a result of a restructure, Sirius International UK Holdings Ltd (UK) is to become a 100% subsidiary of CMIGC, and a holding company of the insurer  from the time it acquires a 100% stake in Sirius Group Holdings (Luxembourg) S.a.r.l (Luxembourg), and, from that time, SI Caleta (Gibraltar) Limited (Gibraltar) will cease to be a holding company of the insurer, and
  2. in the light of a., the persons listed in Schedule 2 have requested that the 26 February 2016 approval be revoked from the time Sirius International UK Holdings Ltd (UK) acquires a 100% stake in the insurer;

 

C.     I am satisfied it is in the national interest to:

 

  1. approve each applicant holding a 100% stake in the insurer and each company that will be a holding company of the insurer and a 100% subsidiary of the applicant from the time that Sirius International UK Holdings Ltd (UK) acquires a 100% stake in Sirius Group Holdings (Luxembourg) S.a.r.l (Luxembourg); and

 

b.      revoke the approval held by the persons in Schedule 2 to hold a 100% stake in the insurer from the time Sirius International UK Holdings Ltd (UK) acquires a 100% stake in the insurer,

 

I, Jennifer Balding, a delegate of the Treasurer, under:

 

(a)   subsection 14(1) of the Act, APPROVE each applicant holding a 100% stake in the insurer and a 100% stake in each company that will be a holding company of the insurer and a 100% subsidiary of the applicant from the time Sirius International UK Holdings Ltd (UK) acquires a 100% stake in the insurer; and

 

(b)   subsection 18(3) of the Act, REVOKE the instrument made on 26 February 2016 granting, among other things, the persons in Schedule 2 approval to hold a 100% stake in the insurer.

This instrument comes into force from the time Sirius International UK Holdings Ltd (UK) acquires a 100% stake in the insurer.  The approvals granted to Sirius Group Holdings (Luxembourg) S.a.r.l (Luxembourg) will cease from the time it is liquidated.

Dated: 17 May 2017

 

[Signed]

 

Jennifer Balding

Acting General Manager

Specialised Institutions Division

Interpretation

In this Notice:

 

100% subsidiary has the meaning given in section 3 of the Act

authorised insurance company has the meaning given in section 3 of the Act

financial sector company has the meaning given in section 3 of the Act

holding company has the meaning given by section 4 of the Act

stake in relation to a company, has the meaning given in clause 10 of Schedule 1 to the Act.

unacceptable shareholding situation has the meaning given in section 10 of the Act

 

Note 1 Under paragraph 16(2)(a) of the Act, the Treasurer may, by written notice given to a person who holds an Approval under section 14, impose one or more conditions or further conditions to which the Approval is subject. Under paragraph 16(2)(b) of the Act, the Treasurer may revoke or vary any conditions imposed under paragraph 16(2)(a) of the Act or specified in the Notice of Approval. The Treasurer’s powers under subsection 16(2) may be exercised on the Treasurer’s own initiative or an application made to the Treasurer in accordance with the requirements of subsection 16(4) of the Act, by the person who holds the Approval (see subsection 16(3) of the Act).

Note 2 A person who holds an Approval under section 14 of the Act may apply to the Treasurer under subsection 17(1) of the Act, to vary the percentage specified in the Approval.


Note 3 Under subsection 17(6) of the Act, the Treasurer may, on the Treasurer’s own initiative, by written notice given to a person who holds an Approval under section 14, vary the percentage specified in the Approval if the Treasurer is satisfied it is in the national interest to do so.

 

Note 4 The circumstances in which the Treasurer may revoke a person’s Approval under section 14 are set out in subsection 18(1) of the Act.

 

Note 5 Section 19 of the Act provides for flow-on approvals.  If an Approval has been granted for the holding of a stake in a financial sector company and the financial sector company is a holding company for an authorised deposit-taking institution or an authorised insurance company, then an approval is taken to exist for the holding of a stake of equal value in each financial sector company that is a 100% subsidiary of the holding company.

 

Note 6 Under section 14 of the Act, the Treasurer must give written notice of this Approval to the applicants and financial sector company concerned and must publish a copy of this notice in the Gazette.

 

Note 7 Under section 11 of the Act, a person or 2 or more persons under an arrangement are guilty of an offence if the person(s) acquires shares in a company and the acquisition has the result, in relation to a financial sector company, that:

(i)                  an unacceptable shareholding situation comes into existence; or

(ii)                if an unacceptable shareholding situation already exists in relation to the company and in relation to a person – there is an increase in the stake held by the person in the company;

 

and the person(s) was reckless as to whether the acquisition would have that result. A maximum penalty of 400 penalty units applies or by virtue of subsection 4B(3) of the Crimes Act 1914, in the case of a body corporate, a penalty not exceeding 2,000 penalty units. By virtue of section 39 of the Act, an offence against section 11 is an indictable offence.

 

Note 8 Under section 32(3) of the Act, if a person has engaged in or is proposing to engage in any conduct in contravention of a condition to which an approval under section 14 is subject, the Federal Court may, on the application of the Treasurer, grant an injunction:

(i)                  restraining the person engaging in the conduct; and

(ii)                if in the court’s opinion, it is desirable to do so, requiring the person to do something.

 

 

SCHEDULE 1 - the persons, in addition to CMIGC), who applied for approval to hold a 100% stake in the insurer

 

1. CM International Holding Pte. Ltd (Singapore)

2. CM Bermuda Ltd. (Bermuda)

3. Sirius International Insurance Group, Ltd. (Bermuda)

4. Sirius International Holdings Ltd. (Bermuda)

5. Sirius International Group, Ltd. (Bermuda)

6. Sirius Bermuda Insurance Company Ltd. (Bermuda)

7. Sirius International UK Holdings Ltd (UK)

8. Sirius Group Holdings (Luxembourg) S.a.r.l (Luxembourg)

9. Sirius Insurance Holding Sweden AB (Sweden)

10. Fund American Holdings AB (Sweden)

 

Note 1: Each of the above companies will be a holding company of the insurer and a 100% subsidiary of each company listed above, if any, whose name is higher on the list at and from the time CMIGC acquires a 100% stake in Sirius International UK Holdings Ltd (UK) (e.g. the company listed at 4. above will be a 100% subsidiary of the companies listed 1., 2. and 3. above)

Note 2:  Sirius International UK Holdings Ltd (UK) has stated it intends to wind up Sirius Group Holdings (Luxembourg) S.a.r.l (Luxembourg) after it acquires 100% of the shares in that company from SI Caleta (Gibraltar) Limited (Gibraltar)

 

Note 3: The place of incorporation of each of the companies in Schedule 1 appears in the brackets after the name of the company  

 

 

SCHEDULE 2 – persons, in addition to CMIGC, who have an approval dated 26 February 2016 to hold a 100% stake in the insurer

 

1. CM International Holding Pte. Ltd (Singapore)

2. CM Bermuda Ltd. (Bermuda)

3. Sirius International Insurance Group, Ltd. (Bermuda)

4. Sirius International Holdings Ltd. (Bermuda)

5. Sirius International Group, Ltd. (Bermuda)

6. Sirius Bermuda Insurance Company Ltd. (Bermuda)

7. SI Caleta (Gibraltar) Limited (Gibraltar)

8. Sirius Group Holdings (Luxembourg) S.a.r.l (Luxembourg)

9. Sirius Insurance Holding Sweden AB (Sweden)

10. Fund American Holdings AB (Sweden)

 

 

 

Overview

The Financial Sector (Shareholdings) Act 1998 was enacted to safeguard the Australian financial sector by regulating significant shareholdings in financial institutions. This legislation was introduced to address the problem of ensuring that the Australian financial sector remains resilient and is not unduly influenced by foreign entities. The Act empowers the Treasurer to approve or reject significant shareholdings in financial institutions, thus ensuring they align with national interests. Under the authority granted by subsection 14(1) of the Act, the Acting General Manager of the Specialised Institutions Division, Jennifer Balding, has approved the China Minsheng Investment Group Corp. Ltd (P.R. China) and other specified entities to hold a 100% stake in Sirius International Insurance Corporation, subject to the national interest. This decision was made to maintain the stability and integrity of Australia’s financial sector amidst a corporate restructuring. The policy objective of the Act is to prevent unacceptable shareholding situations that could compromise the stability of the financial sector, as outlined in section 11 of the Act.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 applies to entities that wish to hold a stake of more than 15% in a financial sector company. This Act applies to both domestic and foreign entities, including China Minsheng Investment Group Corp. Ltd (CMIGC) and other companies listed in the schedules attached to this instrument. The Act has a national jurisdictional reach, applying across Australia and to Australian financial sector companies. The Act allows for the approval or revocation of shareholdings that may be considered to affect the stability or integrity of Australia’s financial system. The Treasurer has the authority to impose conditions on approvals or revoke existing approvals, as demonstrated in this instrument where the restructuring of Sirius International UK Holdings Ltd (UK) resulted in the revocation of the 2016 approval for certain entities to hold a 100% stake in the insurer. This instrument also approves new shareholdings for specified entities and their subsidiaries. Exclusions, exemptions, or specific thresholds are defined in the Act and further detailed in the schedules to this instrument. The Act's provisions can be extended or restricted through subordinate instruments as outlined in the notes accompanying this legislation.

Key Provisions

The Financial Sector (Shareholdings) Act 1998, through this Gazette, addresses the approval and revocation of significant stakes in financial sector companies. Section 13 of the Act governs the approval process for holding a stake of more than 15% in a financial sector company, while section 14 pertains to the approval for holding a 100% stake in an authorised insurance company. In this instance, the Gazette approves the applicants listed in Schedule 1, including China Minsheng Investment Group Corp. Ltd (CMIGC), to hold a 100% stake in Sirius International Insurance Corporation and in the companies that will become holding companies of the insurer and 100% subsidiaries of the applicants upon acquisition by Sirius International UK Holdings Ltd (UK). This approval comes into effect from the moment Sirius International UK Holdings Ltd (UK) acquires a 100% stake in Sirius Group Holdings (Luxembourg) S.a.r.l (Luxembourg). The Gazette also revokes the approval held by the parties listed in Schedule 2 to hold a 100% stake in the insurer from the same moment, in line with the restructuring. The Act imposes specific obligations on the parties it governs. Primarily, these include compliance with the terms of the approval and adherence to any conditions imposed by the Treasurer. Under the Act, the Treasurer can impose additional conditions on existing approvals or revoke or vary them if deemed necessary. The applicants must ensure that their shareholdings remain within the approved limits and comply with all relevant conditions. Furthermore, the Act mandates the Treasurer to notify the applicants and the financial sector company concerned of any approval or revocation and to publish the notice in the Gazette. Violations of the Act's provisions can lead to significant legal consequences. Under section 11, any person or group of persons who acquire shares in a company resulting in an unacceptable shareholding situation in a financial sector company commits an offence if they do so recklessly. The maximum penalty for an individual is 400 penalty units, while for a body corporate, it can be up to 2,000 penalty units. These offences are indictable, meaning they can be prosecuted in a higher court. Additionally, section 32(3) empowers the Federal Court to grant an injunction against any person contravening the conditions of their approval, thereby restraining them from engaging in the prohibited conduct. This ensures that the provisions of the Act are strictly enforced to maintain the integrity and stability of the financial sector.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.