Corporations Act 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

Note: This Chapter applies to a CCIV in a modified form: see Division 4 of Part 8B.7 .

PART 7.9 - FINANCIAL PRODUCT DISCLOSURE AND OTHER PROVISIONS RELATING TO ISSUE, SALE AND PURCHASE OF FINANCIAL PRODUCTS  

Division 5B - Disclosure etc. in relation to short sales covered by securities lending arrangement of listed section 1020B products  

Note: Section 1020B prohibits certain short sales of section 1020B products.

SECTION 1020AB   SELLER DISCLOSURE  

1020AB(1)    
Subsection (3) applies if:

(a) either:

(i) a financial services licensee, on behalf of a person (the seller ), makes a sale in this jurisdiction of section 1020B products on a licensed market to a buyer; or

(ii) a financial services licensee (the seller ), on its own behalf, makes a sale in this jurisdiction of section 1020B products on a licensed market to a buyer; and

(b) before the time of the sale, the seller had entered into or gained the benefit of a securities lending arrangement; and

(c) at the time of the sale, the seller intends that the securities lending arrangement will ensure that some or all the section 1020B products can be vested in the buyer; and

(d) the following requirements are satisfied (if applicable):

(i) if regulations made for the purposes of this subparagraph specify a kind of section 1020B product - the section 1020B products are of that kind;

(ii) if regulations made for the purposes of this subparagraph specify a kind of section 1020B product - the section 1020B products are not of that kind;

(iii) if regulations made for the purposes of this subparagraph specify circumstances in which the sale is made - the sale is made in those circumstances.

1020AB(2)    
Subsection (3) applies regardless of whether the seller is inside or outside Australia.

Offence

1020AB(3)    
The seller must:

(a) give the entity mentioned in subsection (4) particulars specified in the regulations in relation to the circumstances mentioned in paragraphs (1)(a), (b) and (c); and

(b) do so:

(i) on or before the time specified in the regulations; and

(ii) in the manner specified in the regulations.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

1020AB(4)    
The entity is:

(a) if subparagraph (1)(a)(i) applies:

(i) the financial services licensee mentioned in that subparagraph; or

(ii) if the regulations specify another entity - that entity; or

(b) if subparagraph (1)(a)(ii) applies:

(i) the operator of the licensed market mentioned in that subparagraph; or

(ii) if the regulations specify another entity - that entity.