Commonwealth Numbered Acts

CORPORATIONS LEGISLATION AMENDMENT ACT 1994 No. 104 of 1994 - SCHEDULE 2

                            SCHEDULE 2               Section 5

AMENDMENTS OF CORPORATIONS LAW RELATING TO CLEARING HOUSE
SUBREGISTER SYSTEM 1. Section 9: Insert:

"'SCH certificate cancellation provisions' means the provisions of the SCH
business rules that deal with:

   (a)  brokers cancelling certificates or other documents of title to quoted
        securities or quoted rights; and

   (b)  matters incidental to brokers cancelling such certificates or
        documents;
'SCH subregister' means a subregister of quoted securities or quoted rights
maintained by the SCH under the SCH business rules;". 2. Subsection 210(2):
Omit "The", substitute "Subject to subsection (3A), the". 3. Subsection
210(3): Omit "A", substitute "Subject to subsection (3A), a". 4. After
subsection 210(3): Insert:

"(3A) If a company's register includes the numbers of certificates evidencing
the holdings of its members, nothing in subsection (2) or (3) requires:

   (a)  a person to be allowed to see those numbers when inspecting the
        register; or

   (b)  a copy of the register, or a part of it, sent to a person to contain
        those numbers.". 5. After section 642: Insert in Division 1 of Part
        6.3: Quoted securities - SCH business rules may specify mode of
        acceptance

"642A.(1) If:

   (a)  an offer relates wholly or partly to shares that are quoted
        securities; and

   (b)  the SCH business rules require that an acceptance of the offer, so far
        as it relates to those shares, must be made in a particular way; an
        acceptance of the offer, so far as it relates to those shares, is
        effective if, and only if, it is made in that way.

"(2) Subsection (1) has effect despite any requirements specified in the
offer.". 6. Subsection 650(3): Omit "written". 7. After subsection 650(3):
Insert:

"(3A) A notice under subsection (3):

   (a)  if it relates to shares that are entered on an SCH subregister - must
        be in an electronic form approved by the SCH business rules for the
        purposes of this Part; or

   (b)  if it relates to shares that are not entered on an SCH subregister -
        must be in writing.". 8. Subparagraph 658(a)(i): Omit "written". 9.
        Subparagraph 658(a)(ii): Omit "the subparagraph, substitute:

"(ii) returning any consideration received by the offeree; and". 10. Paragraph
658(b): Omit "the paragraph, substitute:

"(b) if the offeree withdraws the acceptance of the offer under paragraph (a),
the offeror must, before the end of 14 days after the withdrawal day (as
defined in subsection (4)):

        (i)    take such action (if any) as the SCH business rules require in
               relation to any of the shares to which the acceptance relates
               that are entered on an SCH subregister; and

        (ii)   return any documents that were sent by the offeree to the
               offeror with the acceptance of the offer.". 11. Section 658:
               Add at the end:

"(2) A notice under subparagraph (1)(a)(i):

   (a)  if it relates to shares that are entered on an SCH subregister - must
        be in an electronic form approved by the SCH business rules for the
        purposes of this Part; or

   (b)  if it relates to shares that are not entered on an SCH subregister -
        must be in writing.

"(3) The reference in subparagraph (1)(a)(ii) to returning consideration
includes, in the case of consideration that consists of securities, a
reference to:

   (a)  if the securities are entered on an SCH subregister - taking such
        action as the SCH business rules require in relation to the return of
        the securities; or

   (b)  otherwise - providing the offeree with any documents of transfer
        necessary to effect the return of securities.

"(4) For the purposes of paragraph (1)(b), the withdrawal day is:

   (a)  if the offeree does the things referred to in paragraph (1)(a) on the
        same day - that day; or

   (b)  if the offeree does those things on different days - the last of those
        days.". 12. Subsection 701(7): Omit "written". 13. After subsection
        701(7): Insert:

"(7A) A notice under subsection (7):

   (a)  if it relates to shares that are entered on an SCH subregister - must
        be in an electronic form approved by the SCH business rules for the
        purposes of this Part; or

   (b)  if it relates to shares that are not entered on an SCH subregister -
        must be in writing.". 14. Section 779F: Repeal the section,
        substitute: SCH business rules have effect as contract

"779F.(1) The SCH business rules have effect, by force of this section, as a
contract under seal:

   (a)  between the SCH and each issuer; and

   (b)  between the SCH and each SCH participant; and

   (c)  between each issuer and each SCH participant; and

   (d)  between an SCH participant and each other SCH participant; under which
        each of the persons mentioned in paragraphs (a) to (d) agrees to
        observe and perform the provisions of the SCH business rules as in
        force for the time being to the extent, and in the manner, provided by
        the SCH business rules.

"(2) In this section:
'issuer' means an issuing body, within the meaning of Division 3 of Part 7.13,
in relation to quoted securities or quoted rights.". 15. Subsection 920(1)
(definition of claim"): After 7" insert ", 7A". 16. Subsection 927(2): After
959(3)" insert ", 961E(3)". 17. Subsection 932(2): After 7" insert ", 7A". 18.
Paragraph 932(3)(a): Omit "or 7", substitute ", 7 or 7A". 19. After section
961B: Insert:

"Division 7A - Contraventions of SCH certificate cancellation provisions
Interpretation

"961C. In this Division:
'claim' means a claim under this Division against SEGC;
'dealer' means a member of a participating exchange. Claim in respect of
contravention of SCH certificate cancellation provisions

"961D.(1) Subject to this section, a person who suffers pecuniary loss in
respect of a contravention, by a dealer, of the SCH certificate cancellation
provisions may make a claim in respect of the loss.

"(2) The loss must not be a loss in respect of an unauthorised execution
(within the meaning of section 956) in respect of which the person has made,
or is entitled to make, a claim under Division 7.

"(3) The person must not have been involved in the contravention.

"(4) The following paragraphs must be satisfied in relation to the dealer:

   (a)  the dealer was a member of a participating exchange on the day of the
        contravention; and

   (b)  either:

        (i)    the dealer was carrying on a securities business in this
               jurisdiction on that day (whether on his, her or its own
               account or in partnership); or

        (ii)   if the dealer was not so carrying on such a business and was
               not carrying on a securities business in any other jurisdiction
               on that day - the last securities business that the dealer
               carried on in a jurisdiction before that day was carried on in
               this jurisdiction. How and when claim may be made

"961E.(1) A claim must:

   (a)  be in writing; and

   (b)  be served on SEGC:

        (i)    if a notice under subsection (4) applies to the claim - before
               the end of the last application day specified in the notice; or

        (ii)   in any other case - within 6 months after the day on which the
               claimant first became aware that the claimant had suffered loss
               as a result of the dealer's contravention of the SCH
               certificate cancellation provisions.

"(2) For the purposes of subsection (1), a notice under subsection (4) applies
to a claim if the claim is in respect of a contravention of the SCH
certificate cancellation provisions, by the dealer named in the notice, during
the applicable period specified in the notice.

"(3) A claim that is not served on SEGC by the time required by paragraph
(1)(b) is barred unless the Board otherwise determines.

"(4) SEGC may publish, in each State and Territory in a daily newspaper
circulating in that State or Territory, a notice that:

   (a)  is in the prescribed form; and

   (b)  names a particular dealer; and

   (c)  requires that all claims in respect of contraventions of the SCH
        certificate cancellation provisions, by the named dealer, during a
        period (the 'applicable period') specified in the notice in accordance
        with subsection (5) must be served on SEGC before the day (the 'last
        application day') specified in the notice in accordance with
        subsection (6).

"(5) The applicable period must be a period that starts and ends before:

   (a)  if each publication of the notice occurs on the same day - the day on
        which the notice is published; or

   (b)  in any other case - the first day on which the notice is published.

"(6) The last application day must be at least 3 months after:

   (a)  if each publication of the notice occurs on the same day - the day on
        which the notice is published; or

   (b)  in any other case - the last day on which the notice is published.

"(7) SEGC, a member of the Board and any employee of, or person acting on
behalf of, SEGC each have qualified privilege in respect of the publication of
a notice under subsection (4). How claim is to be satisfied

"961F.(1) Subject to section 961H, SEGC must allow a claim if the Board is
satisfied that the claimant is entitled to make the claim.

"(2) If SEGC allows the claim, it must pay to the claimant the amount that,
when the claim is allowed, is the actual pecuniary loss suffered by the
claimant because of the contravention in respect of which the claim was made.

"(3) For the purposes of subsection (2), the actual pecuniary loss suffered by
the claimant does not include any loss in respect of an unauthorised execution
(within the meaning of section 956) in respect of which the claimant has made,
or is entitled to make, a claim under Division 7. Discretionary further
compensation

"961G.(1) If:

   (a)  SEGC allows a claim; and

   (b)  the Board is satisfied that the payment of money to the claimant under
        section 961F will not adequately compensate the claimant for a
        pecuniary or other gain that the claimant did not make, but might have
        made, were it not for the contravention in respect of which the claim
        was made; the Board may determine in writing that the claimant should
        be paid in respect of that gain a specified amount that the Board
        considers to be fair and reasonable in all the circumstances.

"(2) If a determination is made under subsection (1), SEGC must pay the
claimant the specified amount. Preventing double recovery

"961H. If:

   (a)  section 961D of the Corporations Law of another jurisdiction permits a
        person to make a claim in respect of a loss; and

   (b)  SEGC allows the claim; SEGC must not allow a claim that section 961D
        of the Corporations Law of this jurisdiction permits the person to
        make in respect of that loss.". 20. Subsection 977(7) (definition of
        cash settlement provision"): After 960" insert "or 961F". 21. After
        subsection 980(2): Insert:

"(2A) Where SEGC allows a claim made under Division 7A in respect of a
contravention of the SCH certificate cancellation provisions, SEGC is
subrogated to all the claimant's rights and remedies in relation to the
contravention.". 22. Subsection 980(5): After 7" insert ", 7A". 23. Subsection
983(2) (definition of claim"): After 7" insert ", 7A". 24. Subsection 983A(6)
(definition of claims Division"): After 7" insert ", 7A". 25. Section 1089:
Add at the end:

"(4) If:

   (a)  a certificate of title to shares, debentures or prescribed interests
        is cancelled under the SCH certificate cancellation provisions; and

   (b)  having regard to those provisions, the certificate should not have
        been cancelled; this section applies to the certificate as though it
        were destroyed on its cancellation.". 26. Section 1097B:

   (a)  Omit "all the words from and including purposes of", substitute
        "purposes of the provisions mentioned in subsection (3), those
        securities or rights are taken to be quoted securities or quoted
        rights during that period.".

   (b)  Add at the end:

"(2) If the SCH business rules provide that marketable securities or
marketable rights that:

   (a)  are approved, by a securities exchange, to be listed for quotation on
        a stock market of a securities exchange, but that are not yet so
        listed; and

   (b)  have been issued; are to be taken to be quoted securities or quoted
        rights for a specified period, then, for the purposes of the
        provisions mentioned in subsection (3), those securities or rights are
        taken to be quoted securities or quoted rights during that period.

"(3) These are the provisions:

   (a)  the definitions of 'proper SCH transfer', 'SCH certificate
        cancellation provisions', 'SCH - regulated transfer' and 'SCH
        subregister' in section 9; and

   (b)  section 642A and the provisions of Parts 7.2A and 7.13, and of any
        regulations made for the purposes of those Parts.". 27. Subsection
        1109C(1): Omit "the securities", substitute "the way in which the
        securities may be transferred". 28. Subsection 1109C(2): Omit "the
        rights or the marketable securities to which they relate", substitute
        "the way in which the rights may be transferred". 29. After section
        1109M: Insert in Subdivision C of Division 3 of Part 7.13:
        Determination of who holds quoted securities for the purposes of a
        meeting

"1109N.(1) This section applies to a meeting of:

   (a)  the holders of securities of a body corporate, provided some or all of
        the securities are quoted securities; or

   (b)  the holders of a class of securities of a body corporate, provided
        some or all of the securities in that class are quoted securities.

"(2) The convener of the meeting may determine that:

   (a)  if paragraph (1)(a) applies - all the securities of the body corporate
        that are quoted securities at a specified time before the meeting; or

   (b)  if paragraph (1)(b) applies - all the securities of the body corporate
        in the relevant class that are quoted securities at a specified time
        before the meeting; are taken, for the purposes of the meeting, to be
        held by the persons who held them at the specified time.

"(3) The specified time must not be more than 48 hours before the meeting.

"(4) Subject to subsection (3), the specified time must satisfy any applicable
requirements of the SCH business rules.

"(5) The determination must be made in accordance with any applicable
requirements of the SCH business rules as to the way in which it must be made.

"(6) The determination must be made before notice of the meeting is given.

"(7) Particulars of the determination must be included in the notice of the
meeting, but a failure to do so does not invalidate the determination.

"(8) The determination has effect accordingly despite anything in:

   (a)  this Law or the regulations; and

   (b)  any other laws (written or unwritten) that apply to the meeting; and

   (c)  any documents (for example, the body corporate's constitution or any
        relevant trust deed) that apply to the meeting. Determination of who
        holds quoted securities for the purposes of conferring security
        benefits

"1109P.(1) If the SCH business rules include provisions relating to the
determination, for the purposes of conferring security benefits, of who holds
or is taken to hold quoted securities at a particular time, those provisions
have effect accordingly despite anything in:

   (a)  this Law or the regulations; and

   (b)  any other laws (written or unwritten) that apply to the conferral; and

   (c)  any documents (for example, the body corporate's constitution or any
        relevant trust deed) that apply to the conferral.

"(2) For the purposes of this section, conferring a security benefit means:

   (a)  paying or transferring money or property to a person because the
        person holds or held a security; or

   (b)  issuing securities to a person because the person holds or held a
        security; or

   (c)  conferring a right on a person because the person holds or held a
        security.". 30. After section 1112A: Insert in Division 3 of Part
        7.13: Offences: contravention by broker of the SCH certificate
        cancellation provisions relating to use of cancellation stamps

"1112B. A broker must not, intentionally or recklessly, contravene the SCH
certificate cancellation provisions by affixing, or failing to affix, a
cancellation stamp to a certificate or other document of title to quoted
securities or quoted rights. Civil liability: contravention by broker of the
SCH certificate cancellation provisions

"1112C.(1) A person who suffers loss or damage because of conduct of a broker
that was engaged in in contravention of the SCH certificate cancellation
provisions may, unless the person was involved in the contravention, recover
the amount of the loss or damage by action against the broker, whether or not
the broker has been convicted of an offence in respect of the contravention.

"(2) An action under subsection (1) must be begun within 6 years after the day
on which the cause of action arose.

"(3) This section does not affect a liability that a person has under any
other law.

"(4) For the purposes of section 1310B, an action under subsection (1) is
taken to be a proceeding in respect of loss or damage arising out of a
contravention of this Law. Issuer protected from civil liability for broker's
contravention of SCH certificate cancellation provisions

"1112D. If:

   (a)  a broker contravenes the SCH certificate cancellation provisions in
        relation to particular quoted securities or quoted rights; and

   (b)  the issuing body in relation to the securities or rights is not
        involved in the contravention; the issuing body is not liable to an
        action or other proceeding for damages in relation to the broker's
        contravention.". 31. Schedule 3: Before Subsection 1114(8)" insert:

"Section 1112B: Penalty: $2,500 or imprisonment for 6 months, or both.".