General exemptions based on ordinary course of commercial dealing
(1)
Financial assistance is exempted from section 260A if it is given in the
ordinary course of commercial dealing and consists of:
- (a)
- acquiring or
creating a lien on partly-paid shares in the company for amounts payable to
the company on the shares; or
- (b)
- entering into an agreement with a person under which the person may make
payments to the company on shares by instalments.
Special exemptions for financial institutions
(2) Financial assistance is
exempted from section 260A if:
- (a)
- the company's ordinary business
includes providing finance; and
- (b)
- the financial assistance is given in the ordinary course of that business
and on ordinary commercial terms.
Special exemptions for subsidiaries of debenture issuers
(3) Financial
assistance is exempted from section 260A if:
- (a)
- the company is a
subsidiary of a borrower in relation to debentures; and
- (b)
- the financial assistance is a guarantee or other security given by the
company for the repayment by the borrower of money that it is or will be
liable to repay; and
- (c)
- the borrower is a borrower in relation to the debentures because it is or
will be liable to repay the money; and
- (d)
- the guarantee or security is given by the company in the ordinary course
of commercial dealing.
Special exemption for approved employee share schemes
(4) Financial
assistance is exempted from section 260A if it is given under an
employee share scheme that has been approved by:
- (a)
- a resolution passed at
a general meeting of the company; and
- (b)
- if the company is a subsidiary of a listed domestic corporationa
resolution passed at a general meeting of the listed domestic corporation; and
- (c)
- if paragraph (b) does not apply but the company has a holding company
that is a domestic corporation and that is not itself a subsidiary of a
domestic corporationa resolution passed at a general meeting of that
holding company.
Other exemptions
(5) The following types of financial assistance are exempted
from section 260A:
- (a)
- a reduction of share capital in accordance with
Division 1 of Part 2J.1;
- (b)
- a share buy-back in accordance with Division 2 of Part 2J.1;
- (c)
- assistance given under a court order;
- (d)
- a discharge on ordinary commercial terms of a liability that the company
incurred as a result of a transaction entered into on ordinary commercial
terms.