Corporations Act 2001

CHAPTER 5D - LICENSED TRUSTEE COMPANIES  

PART 5D.5 - LIMIT ON CONTROL OF LICENSED TRUSTEE COMPANIES AND PROPOSED LICENSED TRUSTEE COMPANIES  

Division 1 - 15 % voting power limit  

SECTION 601VAA  

601VAA   MEANING OF UNACCEPTABLE CONTROL SITUATION - LICENSED TRUSTEE COMPANY OR A PROPOSED LICENSED TRUSTEE COMPANY  

An unacceptable control situation exists in relation to:

(a)    a licensed trustee company and in relation to a particular person; or

(b)    a proposed licensed trustee company and in relation to a particular person;

if the person ' s voting power in the company is more than:

(c)    15%; or

(d    if an approval of a higher percentage is in force under Division 2 in relation to the company and in relation to the person - that higher percentage.

SECTION 601VAB  

601VAB   ACQUISITIONS OF SHARES  

If:

(a) a person, or 2 or more persons under an arrangement, acquire shares in a body corporate; and

(b) the acquisition has the result, in relation to a licensed trustee company, that:

(i) an unacceptable control situation comes into existence in relation to the trustee company and in relation to a person; or

(ii) if an unacceptable control situation already exists in relation to the trustee company and in relation to a person - there is an increase in the voting power of the person in the trustee company;

the person or persons mentioned in paragraph (a) contravene this section.

Note: A contravention of this section is an offence (see subsection 1311(1) ).

SECTION 601VAC   ORDERS TO REMEDY UNACCEPTABLE CONTROL SITUATION  

601VAC(1)    
If an unacceptable control situation exists in relation to a licensed trustee company, the Court may make such orders as the Court considers appropriate for the purpose of ensuring that the unacceptable control situation ceases to exist.

601VAC(2)    
However, the Court may only make orders under this section on application by:

(a)    the Minister; or

(b)    ASIC; or

(c)    the trustee company; or

(d)    a person who has any voting power in the trustee company; or

(e)    a client of the trustee company.

601VAC(3)    
The Court's orders may include:

(a)    an order directing the disposal of shares; or

(b)    an order restraining the exercise of any rights attached to shares; or

(c)    an order prohibiting or deferring the payment of any sums due to a person in respect of shares held by the person; or

(d)    an order that any exercise of rights attached to shares be disregarded; or

(e)    an order directing any person to do or refrain from doing a specified act, for the purpose of securing compliance with any other order made under this section; or

(f)    an order containing such ancillary or consequential provisions as the Court thinks just.

601VAC(4)    
Subsection (3) does not, by implication, limit subsection (1) .

601VAC(5)    
Before making an order under this section, the Court may direct that notice of the application be given to such persons as the Court thinks fit or be published in such manner as the Court thinks fit, or both.

601VAC(6)    
The Court may, by order:

(a)    rescind, vary or discharge an order made by the Court under this section; or

(b)    suspend the operation of such an order.

SECTION 601VAD   INJUNCTIONS  

601VAD(1)   [ Persons affected]  

If any conduct (including a refusal or failure to act) amounts or would amount to a contravention of this Part in relation to a particular licensed trustee company, the trustee company is taken, for the purposes of section 1324 , to be a person whose interests are affected by the conduct.

601VAD(2)   [ Class of persons not limited]  

Subsection (1) does not, by implication, limit the class of persons whose interests are affected by the conduct.

601VAD(3)   [ Power of Minister]  

The Minister has the same powers as ASIC to apply for an injunction under section 1324 in relation to a contravention of this Part.

601VAD(4)   [ Powers not limited]  

The powers in sections 601VAC and 1324 do not, by implication, limit each other.

Division 2 - Approval to exceed 15 % voting power limit  

SECTION 601VBA   APPLICATION FOR APPROVAL TO EXCEED 15 % VOTING POWER LIMIT  

601VBA(1)    

A person may apply for approval to have voting power of more than 15 % in a particular licensed trustee company or proposed licensed trustee company by lodging with ASIC an application that:

(a)    

specifies the percentage of voting power (if any) the person currently has in the company; and

(b)    

specifies the percentage of voting power the person is seeking approval to have in the company; and

(c)    sets out the person ' s reasons for making the application.

Note: For fees in respect of lodging applications, see Part 9.10 .

601VBA(2)    
ASIC must give the application to the Minister as soon as possible.

SECTION 601VBB   APPROVAL OF APPLICATION  

601VBB(1)    
The Minister may grant the application if the Minister is satisfied that:

(a)    

in the case of a licensed trustee company - it would be in the interests of that company and its clients for the application to be granted; or

(b)    

in the case of a proposed licensed trustee company - it would be in the interests of that company and its clients for the application to be granted were that company a licensed trustee company.

601VBB(2)    
If the Minister grants the application, the Minister must:

(a)    give written notice of the approval to the applicant; and

(b)    

specify the percentage of the voting power the Minister approves the applicant having in the company (which may or may not be the percentage the applicant applied for); and

(c)    either:

(i) specify the period during which the approval remains in force; or

(ii) specify that the approval remains in force indefinitely.

601VBB(3)    
If the Minister refuses the application, the Minister must give written notice of the refusal to the applicant.

601VBB(4)    
As soon as practicable, the Minister must arrange for a copy of a notice of approval under this section to be:

(a)    published in the Gazette; and

(b)    

given to the company concerned.

SECTION 601VBC   DURATION OF APPROVAL  

601VBC(1)    
An approval under section 601VBB remains in force:

(a) if the notice of approval specifies a period during which the approval remains in force - until the end of that period, or if the Minister extends that period, until the end of that extended period; or

(b) otherwise - indefinitely.

Extension of approval

601VBC(2)    
A person who holds an approval under section 601VBB that is in force for a specified period may apply to extend that period by lodging with ASIC an application that sets out the person's reasons for making the application.

Note: For fees in respect of lodging applications, see Part 9.10 .

601VBC(3)    
ASIC must give the application to the Minister as soon as possible.

601VBC(4)    
The Minister may grant the application if the Minister is satisfied that:

(a)    

in the case of a licensed trustee company - it would be in the interests of that company and its clients for the application to be granted; or

(b)    

in the case of a proposed licensed trustee company - it would be in the interests of that company and its clients for the application to be granted were that company a licensed trustee company.

601VBC(5)    
If the Minister grants the application, the Minister must:

(a)    give written notice of the extension to the applicant; and

(b)    specify the extended period during which the approval remains in force (which may or may not be the period the applicant applied for).

601VBC(6)    
If the Minister refuses the application, the Minister must give written notice of the refusal to the applicant.

601VBC(7)    
As soon as practicable, the Minister must arrange for a copy of a notice of extension under this section to be:

(a)    published in the Gazette; and

(b)    

given to the company concerned.

SECTION 601VBD   CONDITIONS OF APPROVAL  

601VBD(1)    
An approval under section 601VBB is subject to such conditions (if any) as are specified in the notice of approval.

601VBD(2)    
The Minister may, by written notice given to a person who holds an approval under section 601VBB :

(a)    impose one or more conditions or further conditions to which the approval is subject; or

(b)    revoke or vary any condition:

(i) imposed under paragraph (a); or

(ii) specified in the notice of approval.

601VBD(3)    
The Minister ' s power under subsection (2) may be exercised:

(a)    on the Minister ' s own initiative; or

(b)    on application by the person who holds the approval.

601VBD(4)    
An application made by a person under paragraph (3)(b) must be lodged with ASIC and must set out the person ' s reasons for making the application.

Note: For fees in respect of lodging applications, see Part 9.10 .

601VBD(5)    
ASIC must give the application to the Minister as soon as possible.

601VBD(6)    
If the Minister refuses an application under paragraph (3)(b) , the Minister must give written notice of the refusal to the applicant.

601VBD(7)    
As soon as practicable, the Minister must arrange for a copy of a notice under subsection (2) to be:

(a)    published in the Gazette ; and

(b)    

given to the company concerned.

601VBD(8)    
A person who holds an approval under section 601VBB must give written notice to ASIC as soon as practicable after they become aware that they have breached a condition to which the approval is subject.

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

SECTION 601VBE   VARYING PERCENTAGE APPROVED  

Application by holder of approval

601VBE(1)    
A person who holds an approval under section 601VBB may apply to vary the percentage specified in the approval by lodging with ASICan application that:

(a)    

specifies the percentage of the voting power the person currently has in the licensed trustee company or proposed licensed trustee company concerned; and

(b)    

specifies the percentage of the voting power the person is seeking approval to have in the company; and

(c)    sets out the person ' s reasons for making the application.

Note: For fees in respect of lodging applications, see Part 9.10 .

601VBE(2)    
ASIC must give the application to the Minister as soon as possible.

601VBE(3)    
The Minister may grant the application if the Minister is satisfied that:

(a)    

in the case of a licensed trustee company - it would be in the interests of that company and its clients for the application to be granted; or

(b)    

in the case of a proposed licensed trustee company - it would be in the interests of that company and its clients for the application to be granted were that company a licensed trustee company.

601VBE(4)    
If the Minister grants the application, the Minister must:

(a)    give written notice of the variation to the applicant; and

(b)    specify the variation granted (which may or may not be the variation the applicant applied for).

601VBE(5)    
If the Minister refuses an application, the Minister must give written notice of the refusal to the applicant.

Minister ' s own initiative

601VBE(6)    
The Minister may, by written notice given to a person who holds an approval under section 601VBB , vary the percentage specified in the approval if the Minister is satisfied that:

(a)    

in the case of a licensed trustee company - the variation would be in the interests of that company and its clients; or

(b)    

in the case of a proposed licensed trustee company - the variation would be in the interests of that company and its clients were that company a licensed trustee company.

Percentage varied upwards

601VBE(7)    
If the Minister varies a percentage upwards, the variation takes effect on the day the notice of variation is given.

Percentage varied downwards

601VBE(8)    
If the Minister varies a percentage downwards, the variation takes effect on the day specified in the notice of variation. The specified day must be a day at least 90 days after the day on which the notice is given.

Notification of variation

601VBE(9)    
As soon as practicable, the Minister must arrange for a copy of a notice of variation under this section to be:

(a)    published in the Gazette ; and

(b)    

given to the company concerned.

SECTION 601VBF   REVOKING AN APPROVAL  

601VBF(1)    

The Minister may, by written notice given to a person who holds an approval under section 601VBB in relation to a licensed trustee company or proposed licensed trustee company, revoke the approval if:

(a)    

the Minister is satisfied that:

(i) in the case of a licensed trustee company - it would be in the interests of that company and its clients for the approval to be revoked; or

(ii) in the case of a proposed licensed trustee company - it would be in the interests of that company and its clients for the approval to be revoked were that company a licensed trustee company.

(b)    

the Minister is satisfied that an unacceptable control situation exists in relation to the company and in relation to the person; or

(c)    the Minister is satisfied that there has been a contravention of a condition to which the approval is subject.

601VBF(2)    
The revocation takes effect on the day specified in the notice of revocation. The specified day must be a day at least 90 days after the day on which the notice is given.

601VBF(3)    
If a person who holds an approval under section 601VBB applies to the Minister for revocation of the approval, the Minister must, by written notice given to the person, revoke the approval. The revocation takes effect on the day specified in the notice of revocation.

601VBF(4)    
As soon as practicable, the Minister must arrange for a copy of a notice of revocation under this section to be:

(a)    published in the Gazette ; and

(b)    

given to the company concerned.

SECTION 601VBG   MINISTER MAY REQUIRE FURTHER INFORMATION FROM APPLICANTS  

601VBG(1)   [ Further information by written notice]  

If a person has made an application under this Division, the Minister may, by written notice given to the person, require the person to give the Minister, within a specified period, further information about the application.

601VBG(2)   [ Refusal to consider application until information given]  

The Minister may refuse to consider the application until the person gives the Minister the information.

SECTION 601VBH  

601VBH   MINISTER MAY SEEK VIEWS OF THE COMPANY CONCERNED AND ITS CLIENTS  

For the purpose of making a decision under this Division (whether or not in response to an application) in relation to a company, the Minister may seek the views of the company concerned and its clients.

SECTION 601VBI   TIME LIMIT FOR MINISTER ' S DECISION  

601VBI(1)    
The Minister must make a decision on an application under this Division within 30 days after receiving the application.

601VBI(2)    
However, before the end of the 30 days, the Minister may decide to extend the period for considering the application until the end of 60 days after the application was received.

601VBI(3)    
If the Minister has not made a decision within the 30 days (or the 60 days, if subsection (2) applies), the Minister is taken to have granted whatever was applied for. As soon as practicable after that happens, the Minister must arrange for a notice to that effect to be:

(a)    published in the Gazette ; and

(b)    

given to the company concerned.

601VBI(4)    
The time for making the decision stops running if the Minister gives a notice under subsection 601VBG(1) in relation to the application, and does not start again until the notice is complied with.

601VBI(5)    

The time limit in this section does not apply to an application under section 601VBB or 601VBE if an unacceptable control situation exists in relation to the applicant and in relation to the relevant company at any time before the Minister makes a decision.

Division 3 - Other matters  

SECTION 601VCA   ACQUISITION OF PROPERTY  

601VCA(1)   [ Remedial orders resulting in acquisition of property]  

The Court must not make an order under section 601VAC if:

(a) the order would result in the acquisition of property from a person otherwise than on just terms; and

(b) the order would be invalid because of paragraph 51(xxxi) of the Constitution.

601VCA(2)   [ Application of compensation provision]  

Section 1350 does not apply in relation to the making of an order under section 601VAC .

601VCA(3)   [ Definitions]  

In this section:

acquisition of property
has the same meaning as in paragraph 51(xxxi) of the Constitution.

just terms
has the same meaning as in paragraph 51(xxxi) of the Constitution.

SECTION 601VCB  

601VCB   INTERESTS OF CLIENTS TO BE VIEWED AS A GROUP  

A reference in this Part to the interests of the clients of a company is a reference to the interests of the clients, when viewed as a group.

SECTION 601VCC   ANTI-AVOIDANCE  

601VCC(1)   [ Minister may give direction to controller]  

If:

(a) one or more persons enter into, begin to carry out or carry out a scheme; and

(b) it would be concluded that the person, or any of the persons, who entered into, began to carry out or carried out the scheme or any part of the scheme did so for the sole or dominant purpose of avoiding the application of any provision of Division 1 in relation to any person or persons (whether or not mentioned in paragraph (a)); and

(c) as a result of the scheme or a part of the scheme, a person (the controller ) increases the controller's voting power in a licensed trustee company;

the Minister may give the controller a written direction to cease having that voting power within a specified time.

601VCC(2)   [ Compliance with direction]  

A person who is subject to a direction under subsection (1) must comply with the direction.

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

601VCC(3)   [ Direction not a legislative instrument]  

A direction under subsection (1) is not a legislative instrument.

601VCC(4)   [ " increase " ]  

In this section:

increase
voting power includes increasing it from a starting point of nil.