Commonwealth Numbered Regulations - Explanatory Statements

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Issued by the Authority of the Treasurer

Corporations Act 1989

Corporations Regulations (Amendment)

Section 22 of the Corporations Act 1989 (the Act) empowers the Governor-General to make regulations, not inconsistent with the Act or the Corporations Law, prescribing, inter alia, matters which are required by the Corporations Law to be prescribed by regulations, or necessary or convenient to be prescribed by regulations for carrying out or giving effect to the Corporations Law.

The Heads of Agreement on Future Corporate Regulation in Australia, reached between State, Northern Territory and Commonwealth Ministers who had responsibilities in relation to corporate regulation in June 1990 forms the political compact on which the national companies and securities scheme is based. The Corporations Agreement, a more formal agreement to supplement the Heads of Agreement, is currently being signed by the parties.

The responsible Ministers of the States and the Northern Territory have been consulted about and have approved the draft regulations, as required by the Agreement.

The regulations:

*       removed and updated obsolete references in the Regulations (Regulations 2, 6, 7 and 8);

*       corrected an anomaly (Regulation 3, 4 and 5); and

*       and updated the list of authorised trustee corporations to reflect two name changes (Regulation 9).

Details of the proposed regulations are as follows:

Regulation 1

Regulation 1 provides that the regulations are amended as set out in these regulations.

Regulations 2, 6 and 7

Regulations 2, 6 and 7 replace all references in the Corporations Regulations to the Life Insurance Act 1945 to reflect the repeal and replacement of this Act by the Life Insurance Act 1995.

Regulations 3, 4 and 5

Prior to these amendments, Corporations Regulations 6.7.01, 6.7.02 and 6.7.03 exempted substantial shareholders and former substantial shareholders from lodging a contract note with the required substantial shareholder notice where the relevant interest was acquired in a transaction that took place 'on a stock exchange approved under section 769 of the Corporations Law'.

It was considered that where the transaction took place on an approved stock exchange it was unnecessary to require the contract note to be attached to the notice.

Regulations 3, 4 and 5 amend these Regulations so that t he exemptions also apply where the transaction took place on the Australian Stock Exchange. The amendment was needed - because, due to the special status of the Corporations Law, the Australian Stock Exchange is not an approved exchange for the purpose of section 769.

Regulation 8

Subregulations 8.1 and 8.3 remove the remaining references to the expression "principal executive officer", which was removed from the Corporations Law by the First Corporate Law Simplification Act.

Subregulation 8.2 corrects an error in Form 602A in Schedule 2, by replacing the incorrect reference to "dissenting offereers" with the correct reference to "dissenting offerees".

Regulation 9

Section 9 of the Corporations Law defines an "authorised trustee corporation" as a body corporate declared in the regulations to be an authorised trustee corporation. Regulation 7.1.01 of the Corporations Regulations provides that a body corporate listed in Schedule 9 of the Corporations Regulations is an authorised trustee corporation.

Subregulation 9.1 inserts "Austrust Limited" into Schedule 9. This is the new name of "Elders Trustee & Executor Company Limited" in item 12.

Subregulation 9.2 removes the reference to "Elders Trustee & Executor Company Limited", and replaces "Executor Trustee and Agency Company of South Australia" with the new name of "Executor Trustee Australia Limited".

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