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CORPORATIONS ACT 2001 - SECT 631

Proposing or announcing a bid

             (1)  A person contravenes this subsection if:

                     (a)  either alone or with other persons, the person publicly proposes to make a takeover bid for securities in a company; and

                     (b)  the person does not make offers for the securities under a takeover bid within 2 months after the proposal.

The terms and conditions of the bid must be the same as or not substantially less favourable than those in the public proposal.

Note:          The Court has power under section 1325B to order a person to proceed with a bid.

          (1A)  For the purposes of an offence based on subsection (1), strict liability applies to paragraph (1)(b) and to the requirement that the terms and conditions of the bid must be the same as or not substantially less favourable than those in the public proposal.

Note:          For strict liability , see section 6.1 of the Criminal Code .

Proposals if takeover bid not intended

             (2)  A person must not publicly propose, either alone or with other persons, to make a takeover bid if:

                     (a)  the person knows the proposed bid will not be made, or is reckless as to whether the proposed bid is made; or

                     (b)  the person is reckless as to whether they will be able to perform their obligations relating to the takeover bid if a substantial proportion of the offers under the bid are accepted.

             (3)  Section 1314 (continuing offences) and subsection 1324(2) (injunctions) do not apply in relation to a failure to make a takeover bid in accordance with a public proposal under subsection (1).

Note:          For liability and defences for contraventions of this section, see sections 670E and 670F.



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