Revocation of existing approval and granting of new approval to hold a stake in a financial sector company of more than 15% - Optus Insurance Services Pty Ltd

Administered by Department of the Treasury

Legislation au C2016G01439 In force Gazette

Legislation content

 

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: Temasek Holdings (Private) Limited (Temasek), Singapore Telecommunications Limited (Singtel), Singapore Telecom Mobile Pte Ltd (Singtel Mobile), Singtel Australia Investment Ltd. ABN 40 636 596 986 (Singtel Australia), Singapore Telecom Australia Investments Pty Limited ABN 69 096 686 190 (SAIPL), Singtel Optus Pty Limited ABN 90 052 833 208 (Singtel Optus) and the persons listed in Schedule 1 (the Temasek associates).

 

SINCE

 

 

A.   Singtel, on behalf of itself and its then associates, applied for and was granted an approval dated 27 August 2001 (the Existing Approval) under subsection 14(1) of the Financial Sector (Shareholdings) Act 1998 (the Act) to hold a 100% stake in each of Optus Insurance Services Pty Limited ABN 12 005 711 928 (Optus Insurance) and Singtel Optus (previously named Cable & Wireless Optus Limited), financial sector companies under the Act;

 

B.  Singtel, on behalf of itself and its then associates, has requested, through the Application, that the Existing Approval be revoked;

 

C. Temasek, on behalf of itself, its associates, Singtel, Singtel Mobile, Singtel Australia, SAIPL and Singtel Optus, through the Application, has applied for approval under section 13 of the Act for:

 

(i)       Temasek, Singtel, Singtel Mobile, Singtel Australia, SAIPL, Singtel Optus and the Temasek associates to hold a 100% stake in Optus Insurance;

 

(ii)     Temasek, Singtel, Singtel Mobile, Singtel Australia, SAIPL and the Temasek associates to hold a 100% stake in Singtel Optus;

 

(iii)  Temasek, Singtel, Singtel Mobile, Singtel Australia and the Temasek associates to hold a 100% stake in SAIPL, a financial sector company under the Act;

 

(iv)   Temasek, Singtel, Singtel Mobile and the Temasek associates to hold a 100% stake in Singtel Australia, a financial sector company under the Act; and

 

(v)     Temasek and the Temasek associates to hold a 54% stake in Singtel, a financial sector company under the Act; and

 

D.  I am satisfied it is in the national interest to grant the above approvals (the Approvals).

 

 

I, Stephen Edward Glenfield, a delegate of the Treasurer:

 

(a)   under subsection 18(3) of the Act, REVOKE the Existing Approval; and

 

(b)  under subsection 14(1) of the Act, APPROVE:

(i) Temasek, Singtel, Singtel Mobile, Singtel Australia, SAIPL, Singtel Optus and the Temasek associates holding a 100% stake in Optus Insurance;

(ii) Temasek, Singtel, Singtel Mobile, Singtel Australia, SAIPL and the Temasek associates holding a 100% stake in Singtel Optus; and

(iii) Temasek, Singtel, Singtel Mobile, Singtel Australia and the Temasek associates holding a 100% stake in SAIPL;

(iv) Temasek, Singtel, Singtel Mobile and the Temasek associates holding a 100% stake in Singtel Australia; and

(v) Temasek and the Temasek associates holding a 54% stake in Singtel; and

 

(c)   under subsection 16(1) of the Act, IMPOSE the conditions set out in Schedule 2 in relation to the Approvals.

 

 

This instrument comes into force on the date it is signed.  The Approvals under this instrument remain in force indefinitely.

 

Dated: 28 October 2016

 

[Signed]

 

 

Stephen Edward Glenfield General Manager

Specialised Institutions Division

South West Region

 

 

Interpretation

 

In this Notice:

 

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

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

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

the Application means the applications received from Temasek and the Temasek associates dated 28 August 2016 and 11 October 2016, and the application received from Singtel, Singtel Mobile, Singtel Australia and SAIPL dated 20 October 2016.

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 applicant 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 Temasek associates

 

1.   Minister for Finance (Incorporated);

2.   Tembusu Capital Pte. Ltd.;

3.   Thomson Capital Pte. Ltd.;

4.   Atrium Investments Pte. Ltd.;

5.   Pilatus Investments Pte. Ltd.;

6.   SeaTown Holdings Pte. Ltd.;

7.   SeaTown Capital Pte. Ltd.;

8.   SeaTown Investments Pte. Ltd.;

9.   SeaTown GP Pte. Ltd.;

10. SeaTown Holdings International Pte. Ltd.;

11. SeaTown Singapore Feeder Fund LP;

12. SeaTown Global Feeder Fund;

13. SeaTown Master Fund;

14. Dymon Asia Multi-Strategy Master Fund;

15. Dymon Asia Multi-Strategy Fund Limited Partnership;

16. Dymon Asia Multi-Strategy Fund;

17. Dymon Asia Capital Ltd;

18. Dymon Asia Capital (Singapore) Pte. Ltd.;

19. Seletar Fund Investments Pte. Ltd.;

20. Fullerton Fund Investments Pte. Ltd.;

21. FFMC Holdings Pte. Ltd.;

22. Fullerton (Private) Limited;

23. Fullerton Fund Management Company Ltd.;

24. ST Asset Management Ltd.;

25. Singapore Technologies Capital Services Pte. Ltd.;

26. EM Services Pte Ltd.;

27. Keppel Land Limited;

28. Keppel Corporation Limited;

29. DBS Bank Ltd.;

30. DBS Group Holdings Limited;

31. Maju Holdings Pte. Ltd.;

32. Aventia Master Fund;

33. Aventia (US) Fund; and

34. Aventia Fund.

 

 

 

 

 

 

 

SCHEDULE 2 – the conditions imposed on the Approvals

 

1.   Optus Insurance shall continue to be a 100% subsidiary of Singtel Optus.

 

2.  APRA is to be informed in writing if Optus Insurance ceases to be a 100% subsidiary of Singtel Optus. Notice shall be given to APRA by Optus Insurance 14 days before it ceases to be a 100% subsidiary of Singtel Optus.

Overview

The Financial Sector (Shareholdings) Act 1998 was enacted to address the issue of controlling stakes in financial sector companies, particularly to ensure they do not fall into the hands of entities that could pose a risk to the financial system's stability and integrity. The Act was introduced by the Commonwealth Parliament to regulate shareholdings in financial sector companies and to protect the national interest. This legislative instrument concerns the revocation of an existing approval granted under the Act to Temasek Holdings (Private) Limited and its associates, including Singtel and its subsidiaries, to hold certain stakes in specified financial sector companies, and the granting of new approvals with conditions. The policy objective is to ensure that the shareholdings remain within safe limits and do not result in an unacceptable shareholding situation, thus safeguarding Australia's financial system.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 applies to entities that intend to hold significant stakes in Australian financial sector companies. This includes both domestic and foreign entities, such as Temasek Holdings (Private) Limited and its associated entities, which are granted specific shareholding approvals under the Act. The Act's jurisdictional reach is national, encompassing all entities that meet the criteria of holding a stake in financial sector companies. The Act imposes restrictions on the percentage of shares that can be held by entities to prevent unacceptable shareholding situations that could pose systemic risks to the financial system. Exclusions and exemptions are not explicitly detailed in the Act, though the Act does allow for the imposition of conditions on approvals and the revocation of approvals if certain thresholds or conditions are not met. The Act also provides mechanisms for subordinate instruments to extend or restrict its application, ensuring that the financial sector remains stable and secure.

Key Provisions

The Financial Sector (Shareholdings) Act 1998 (the Act) outlines the legislative framework governing the approval of significant shareholdings in Australian financial sector companies. Under section 13 of the Act, an approval is required for any person or group of persons to hold a stake of more than 15% in a financial sector company, unless exempted by the Act. The main operative sections of this legislation, as applied in the given instrument, involve the revocation of an existing approval and the granting of new approvals for specified shareholdings. Under subsection 18(3) of the Act, the delegate of the Treasurer revokes the existing approval held by Singtel and its associates for a 100% stake in Optus Insurance and Singtel Optus. Simultaneously, under subsection 14(1) of the Act, new approvals are granted to Temasek, Singtel, and their associates for specified stakes in various financial sector companies, as outlined in the instrument. These approvals are subject to certain conditions imposed under subsection 16(1) of the Act, which are detailed in Schedule 2. The Act imposes several obligations on the parties to whom the approvals are granted. Firstly, they must comply with the conditions set out in Schedule 2, which include maintaining the specified shareholding structures and notifying the Australian Prudential Regulation Authority (APRA) of any changes. The entities are also required to maintain accurate records and provide updates to the Treasurer as necessary. Furthermore, they must ensure that their operations do not result in an unacceptable shareholding situation, as defined in section 10 of the Act, and must act with due diligence to avoid reckless acquisitions that could lead to such situations. The Act also mandates that the Treasurer be notified of any changes in shareholding percentages under subsection 17(1) of the Act, and the Treasurer retains the right to vary these percentages under subsection 17(6) if deemed in the national interest. The Act provides for both civil and criminal consequences for breaches of its provisions. Under section 11 of the Act, an individual or group of individuals can be charged with an indictable offence if they acquire shares in a financial sector company in a manner that results in an unacceptable shareholding situation, or if such a situation already exists and their acquisition increases their stake. The maximum penalty for an individual is 400 penalty units, while for a body corporate, the penalty can be up to 2,000 penalty units. Additionally, under section 32(3) of the Act, the Federal Court can grant an injunction to restrain any person from engaging in conduct that contravenes the conditions of an approval, if the Treasurer applies for such an injunction. The court may also require the person to take specific actions if it deems it desirable. Failure to comply with the terms of the approval or the conditions imposed can lead to legal action and potential penalties.

Legal classification tags

Area of Law
Financial Sector (Shareholdings) Act 1998
Instrument
Gazette Notice
Concepts
Definitions & Interpretation
Offence Provisions
Reporting & Disclosure Obligations
Regulatory Standards

Interactions

Authorises

All Versions

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.