Corporations Act 2001

CHAPTER 2E - RELATED PARTY TRANSACTIONS  

Note: This Chapter applies to a CCIV with modifications: see Division 5 of Part 8B.3 .

PART 2E.1 - MEMBER APPROVAL NEEDED FOR RELATED PARTY BENEFIT  

Division 1 - Need for member approval  

SECTION 208   NEED FOR MEMBER APPROVAL FOR FINANCIAL BENEFIT  

208(1)    
For a public company, or an entity that the public company controls, to give a financial benefit to a related party of the public company:

(a)    the public company or entity must:

(i) obtain the approval of the public company ' s members in the way set out in sections 217 to 227 ; and

(ii) give the benefit within 15 months after the approval; or

(b)    the giving of the benefit must fall within an exception set out in sections 210 to 216 .

Note 1: For the criminal liability of a person dishonestly involved in a contravention of this subsection, see subsection 209(3) .

Note 2: This section applies to a CCIV in a modified form: see section 1227A .

208(2)    
If:

(a)    the giving of the benefit is required by a contract; and

(b)    the making of the contract was approved in accordance with subparagraph (1)(a)(i) as a financial benefit given to the related party; and

(c)    the contract was made:

(i) within 15 months after that approval; or

(ii) before that approval, if the contract was conditional on the approval being obtained;

member approval for the giving of the benefit is taken to have been given and the benefit need not be given within the 15 months.