Income Tax Assessment Act 1936

SCHEDULE 2H - DEMUTUALISATION OF MUTUAL ENTITIES OTHER THAN INSURANCE COMPANIES AND HEALTH INSURERS  

Division 326 - DEMUTUALISATION  

Subdivision 326-B - How demutualisation is to be effected  

SECTION 326-50   HOLDING COMPANY METHOD  

326-50(1)    
The holding company method of demutualisation is as follows:

(a) all membership rights in the entity are extinguished;

(b) the entity becomes a company with a share capital;

(c) shares of only one class in the entity are issued to a company (the holding company ) within the limitation period;

(d) shares ( ordinary shares ) of only one class in the holding company are issued within the limitation period to existing members in exchange for the membership rights referred to in paragraph (a);

(e) shares (also ordinary shares ) in the holding company of the same class may be issued within the limitation period to new members;

(f) if a listing resolution was passed by the entity - the ordinary shares are listed within the limitation period.

Note:

Other things may happen in connection with the implementation of the demutualisation.

326-50(2)    
The following diagram shows the main events that occur where this demutualisation method is used.