Foreign Acquisitions and Takeovers Act 1975

PART 2 - ACTIONS TO WHICH THIS ACT APPLIES  

Division 2 - Meaning of significant action  

SECTION 40   MEANING OF SIGNIFICANT ACTION - ENTITIES  

40(1)    
An action is a significant action if the conditions in this section are met.

First condition - kinds of action

40(2)    
The first condition is that the action is any of the following:

(a) to acquire a direct interest in an Australian entity that is an agribusiness;

(b) to acquire interests in securities in an entity;

(c) to issue securities in an entity;

(d) to enter an agreement:

(i) relating to the affairs of the entity; and

(ii) under which one or more senior officers of the entity will be under an obligation to act in accordance with the directions, instructions or wishes of a foreign person who holds a substantial interest in the entity (or of an associate of such a foreign person);

(e) to alter a constituent document of the entity as a result of which one or more senior officers of the entity will be under an obligation to act in accordance with the directions, instructions or wishes of a foreign person who holds a substantial interest in the entity (or of an associate of such a foreign person).

Note: An action mentioned in any of paragraphs (2)(b) to (e) may be taken in relation to an Australian entity that is an agribusiness (see section 42 ).

Second condition - threshold

40(3)    
The second condition is that the threshold test is met in relation to the entity (see Subdivision B of Division 4 ).

Third condition - kinds of entities covered

40(4)    
The third condition (except if paragraph (2)(a) applies) is that the entity is the following:

(a) for an acquisition of interests in shares or an issue of shares:

(i) a corporation that is a relevant entity that carries on an Australian business, whether alone or together with one or more other persons; or

(ii) the holding entity of such a corporation;

(b) for any other action relating to a corporation:

(i) an Australian corporation that carries on an Australian business, whether alone or together with one or more other persons; or

(ii) the holding entity (other than a foreign corporation) of such a corporation;

(c) for an action relating to a unit trust:

(i) an Australian unit trust; or

(ii) a holding entity of an Australian unit trust.

Last condition - action taken by a foreign person

40(5)    
If paragraph (2)(a) applies, the last condition is that the action is or is to be taken by a foreign person.

Last condition - action results in change in control

40(6)    
If any of paragraphs (2)(b) to (e) apply, the last condition is that there would be or has been a change in control of the entity as a result of the action (see Subdivision C of Division 4 ).

40(7)    

However, the last condition in subsection (6) is not required to be met if:

(a)    paragraph (2)(b) applies and the action is or is to be taken by a foreign person who controls the entity (whether alone or together with one or more associates) immediately before the action is or is to be taken; or

(b)    paragraph (2)(c) applies and a foreign person controls the entity (whether alone or together with one or more associates) immediately before the action is or is to be taken.