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

Administered by Department of the Treasury

Legislation au C2018G00853 In force Gazette

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

Approval to hold a stake in a financial sector company of more than 15%

Financial Sector (Shareholdings) Act 1998

To: Allianz SE, Allianz Europe B.V. and Allianz Australia Life Insurance Holdings Limited ABN 95 623 445 474               (AALIHL) (the applicants)

 

SINCE

 

  1. Allianz Europe B.V. and Allianz SE have applied to the Treasurer under section 13 of the Financial Sector (Shareholdings) Act 1998 (the Act) for approval to hold a 100% stake in each of AALIHL and Allianz Australia Life Insurance Limited ABN 27 076 033 782 (AALIL), financial sector companies under the Act;

 

B.     AALIHL has applied to the Treasurer under section 13 of the Act for approval to hold a 100% stake in AALIL;

 

C.     Approvals were previously granted on 20 April 1999 and 30 December 2009 to Allianz Europe B.V. and Allianz SE (the current holders) under subsection 14(1) of the Act to hold a 100% stake in AALIL (the existing approvals);

 

D.     The current holders have requested that the existing approvals be revoked in so far as they apply to their holding stakes in AALIL from the time, if any, a new approval is granted in respect of the application referred to in Recital A;

 

E.     I am satisfied that it is in the national interest to approve the applicants holding a 100% stake in each of AALIHL and AALIL (as relevant); and

 

F.      I am satisfied it is in the national interest to revoke the existing approvals so far as they permit the current holders to hold a 100% stake in AALIL from the time a new approval is granted to the applicants to hold a 100% stake in AALIL;

 

I, Nigel Boik, a delegate of the Treasurer:

 

(a)   under section 14(1) of the Act, APPROVE:

(i) the applicants holding a 100% stake in AALIL; and

(ii) Allianz Europe B.V. and Allianz SE holding a 100% stake in AALIHL; and

 

(b)   under subsection 18(3) of the Act, REVOKE the approvals granted  on 20 April 1999 and 30 December 2009 so far as they permitted the current holders to hold a 100% stake in AALIL.

 

This instrument comes into force from the date it is signed and remains in force indefinitely. 

Dated 24 October 2018

 

 

 

[Signed]

………………………

Nigel Boik

General Manager

Diversified 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.

 

 

 

 

 

 

 

Overview

The Financial Sector (Shareholdings) Act 1998 was enacted to address the potential risks posed by significant shareholdings in financial sector companies, ensuring that such stakes do not threaten financial stability. The Act was introduced by the Commonwealth Parliament to regulate and monitor large shareholdings in financial institutions to safeguard the integrity and stability of the financial sector. The policy objective of the Act is to prevent unacceptable shareholding situations, where the concentration of ownership could lead to undue influence or risk to the financial system. This legislative framework empowers the Treasurer to grant or revoke approvals for shareholdings exceeding 15% in financial sector companies, ensuring that such stakes do not compromise the stability and soundness of the financial system. The Act also provides mechanisms for imposing conditions on shareholdings and for penalising reckless acquisitions that lead to unacceptable shareholding situations.

Scope and Application

The Financial Sector (Shareholdings) Act 1998 applies to any person or entity seeking to acquire, hold, or increase a stake in a financial sector company, which includes authorised deposit-taking institutions and authorised insurance companies as defined in the Act. The Act regulates shareholdings to prevent unacceptable shareholding situations that could impact financial stability, and it applies nationally across Australia, overseen by the Commonwealth Treasurer. The Act allows for the granting of specific approvals to entities like Allianz SE, Allianz Europe B.V., and Allianz Australia Life Insurance Holdings Limited to hold stakes in financial sector companies, subject to certain conditions and limitations. Exclusions and exemptions are minimal, and the Act's application can be extended or modified through subordinate instruments, such as notices and approvals, which may impose additional conditions or revoke existing approvals based on the national interest.

Key Provisions

The Financial Sector (Shareholdings) Act 1998 governs shareholdings in financial sector companies, particularly focusing on the approval process for holding significant stakes. Under section 14(1), the Treasurer has the authority to approve an entity's holding of a stake in a financial sector company exceeding 15%. This Act also permits the Treasurer to revoke existing approvals if deemed necessary in the national interest, as outlined in subsection 18(3). This specific instrument grants approval for Allianz SE, Allianz Europe B.V., and Allianz Australia Life Insurance Holdings Limited (AALIHL) to hold a 100% stake in Allianz Australia Life Insurance Limited (AALIL) and AALIHL, while revoking previous approvals held by the current holders concerning their 100% stake in AALIL. The Act imposes several obligations on the entities it governs. Firstly, any entity seeking to hold a stake in a financial sector company exceeding 15% must apply for approval from the Treasurer. The Act requires the Treasurer to notify the applicants and the relevant financial sector company of the approval and publish the notice in the Gazette (section 14 and Note 6). Additionally, the Treasurer has the power to impose conditions on the approval, vary these conditions, or revoke the approval altogether if it is in the national interest to do so (subsections 16(2) and 18(1)). The Act also mandates that if an approval exists for a holding company, it extends to the holding of an equal value stake in each of its 100% subsidiaries (section 19). Non-compliance with the provisions of the Act can result in significant consequences. Section 11 of the Act imposes a criminal offence on individuals or entities that acquire shares in a financial sector company, resulting in an unacceptable shareholding situation or an increase in an existing unacceptable shareholding situation, without the requisite approval. A person found guilty of such an offence is subject to a maximum penalty of 400 penalty units or 2,000 penalty units in the case of a body corporate (subsection 4B(3) of the Crimes Act 1914). Moreover, under section 32(3) of the Act, the Federal Court can grant an injunction against a person or entity engaging in conduct that contravenes the conditions of an approval, at the application of the Treasurer. This injunction can restrain the person from engaging in the conduct or require them to perform certain actions if deemed necessary by the court.

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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.