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CORPORATIONS LEGISLATION AMENDMENT ACT 1994 No. 104 of 1994 - SCHEDULE 3
SCHEDULE 3 Section 6
AMENDMENTS OF CORPORATIONS LAW RELATING TO FINANCIAL INSTITUTIONS 1. Section 9
(paragraph (b) of the definition of public company"): After "other than a"
insert "financial institution or a". 2. Section 9 (paragraph (a) of the
definition of public corporation"): After "the paragraph", insert:
"(aa) a financial institution; or". 3. Section 9 (definition of registrable
Australian body"): After "include a" insert "financial institution or a". 4.
Section 9 (definition of corporation"): Omit "the definition, substitute:
"'corporation' has the meaning given by section 57A;". 5. Section 9: Insert:
"'AFIC Codes' has the meaning given by section 111AZB;
'building society' has the meaning given by subsection 111AZA(2);
'building society special services provider' has the meaning given by
subsection 111AZD(2);
'credit union' has the meaning given by subsection 111AZA(3);
'credit union special services provider' has the meaning given by subsection
111AZD(3);
'financial institution' has the meaning given by subsection 111AZA(1);
'Financial Institutions Codes' has the meaning given by section 111AZC;
'special services provider' has the meaning given by subsection 111AZD(1);
'withdrawable share' has the meaning given by section 111AZE;". 6. After
section 57: Insert: Meaning of corporation"
"57A.(1) Subject to this section, in this Law, 'corporation' includes:
(a) any body corporate, whether incorporated in this jurisdiction or
elsewhere; and
(b) a company; and
(c) a recognised company; and
(d) an unincorporated body that:
(i) is formed outside this jurisdiction; and
(ii) under the law of its place of formation, may sue or be sued, or
may hold property in the name of its secretary or of an officer
of the body duly appointed for that purpose; and
(iii) does not have its head office or principal place of business in
this jurisdiction.
"(2) Neither of the following is a corporation:
(a) an exempt public authority;
(b) a corporation sole.
"(3) A financial institution (as defined in section 111AZA):
(a) is a corporation for the purposes of Parts 7.11 and 7.12; but
(b) is not a corporation for the purposes of the other provisions of this
Law.
"(4) An exempt body in relation to this jurisdiction (as defined in section
66A) is not a corporation.". 7. Paragraphs 66A(1)(b), (c) and (d): Omit "the
paragraphs, substitute:
"(b) a co - operative within the meaning of the Co - operatives Act 1992 of
New South Wales or a foreign co - operative within the meaning of that Act
registered under Division 3 of Part 2 of that Act;
(c) a friendly society within the meaning of the Friendly Societies Act
1989 of New South Wales;
(d) a registrable body or recognised company in respect of which an
exemption from compliance with subsection 61(1) of the Co - operation
Act 1923 of New South Wales is in force;". 8. Paragraph 66A(2A)(b):
Omit "the paragraph. 9. Paragraph 66A(2A)(c): Omit "the paragraph,
substitute:
"(c) a society within the meaning of the Co - operation Act 1981 of Victoria
and a foreign society registered under Part XI of that Act;". 10. Paragraph
66A(2)(b): After "Queensland" insert "that is not a financial institution".
11. Paragraph 66A(2)(f): Omit "the paragraph. 12. Subsection 66A(3): After
"body corporate" insert ", other than a financial institution,". 13. Paragraph
66A(4)(a): After "Western Australia" insert "that is not a financial
institution". 14. Paragraph 66A(4)(b): Omit "the paragraph, substitute:
"(b) The WA Teachers Financial Society Limited;".
15. Paragraph 66A(5)(b):
(a) After "society" insert ", other than a financial institution,".
(b) Omit "the Building Societies Act 1876,". 16. Paragraph 66A(6)(a):
After "Northern Territory" insert "that is not a financial
institution". 17. Paragraph 66A(6)(b): Omit "the paragraph. 18.
Paragraph 66A(7)(a): After "Capital Territory" insert "that is not a
financial institution". 19. Subsection 69A(1): Omit "the subsection,
substitute:
"(1) The following are exempt securities in relation to New South Wales:
(a) securities of a body registered as a co - operative under the Co -
operatives Act 1992 of New South Wales;
(b) securities of a society, association or union registered under the Co
- operation Act 1923 of New South Wales.". 20. Paragraph 69A(4)(a):
Omit "the paragraph, substitute:
"(a) securities of a society registered under the Starr - Bowkett Societies
Act 1975 of South Australia;". 21. Paragraph 69A(4)(b): Omit "the paragraph.
22. Paragraph 69A(5)(a): After "Northern Territory" insert "that is not a
financial institution". 23. Paragraph 69A(5)(b): Omit "the paragraph. 24.
Before Part 1.3: Insert:
"PART 1.2B - FINANCIAL INSTITUTIONS
"Division 1 - Object of Part Object of Part
"111AY. The object of this Part is:
(a) to define 'financial institution' and other key expressions relevant
to financial institutions (this is done in Division 2); and
(b) to list some other key expressions used in this Law and indicate
whether or not they cover financial institutions (this is done in
Division 3). Division 2 - Definitions Terms defined in Division
"111AZ. This Division contains definitions of the following terms:
(a) financial institution, building society and credit union (section
111AZA);
(b) AFIC Codes (section 111AZB);
(c) Financial Institutions Codes (section 111AZC);
(d) special services provider, building society special services provider
and credit union special services provider (section 111AZD);
(e) withdrawable share (section 111AZE). Financial institution, building
society and credit union
"111AZA.(1) A financial institution is a body, or an entity within the meaning
of Part 3.6, that:
(a) is a financial institution for the purposes of any of the Financial
Institutions Codes; and
(b) is not excluded by the regulations.
"(2) A building society is a financial institution that is a building society
for the purposes of any of the Financial Institutions Codes.
"(3) A credit union is a financial institution that is a credit union for the
purposes of any of the Financial Institutions Codes. AFIC Codes
"111AZB. The AFIC Codes are:
(a) the AFIC (NSW) Code of New South Wales;
(b) the AFIC (Victoria) Code of Victoria;
(c) the AFIC (Queensland) Code of Queensland;
(d) the AFIC (Western Australia) Code of Western Australia;
(e) the AFIC (South Australia) Code of South Australia;
(f) the AFIC (Tasmania) Code of Tasmania;
(g) the AFIC (ACT) Code of the Capital Territory;
(h) the AFIC (NT) Code of the Northern Territory. Financial Institutions
Codes
"111AZC. The Financial Institutions Codes are:
(a) the Financial Institutions (NSW) Code of New South Wales;
(b) the Financial Institutions (Victoria) Code of Victoria;
(c) the Financial Institutions (Queensland) Code of Queensland;
(d) the Financial Institutions (Western Australia) Code of Western
Australia;
(e) the Financial Institutions (South Australia) Code of South Australia;
(f) the Financial Institutions (Tasmania) Code of Tasmania;
(g) the Financial Institutions (ACT) Code of the Capital Territory;
(h) the Financial Institutions (NT) Code of the Northern Territory.
Special services providers
"111AZD.(1) A special services provider is a body, or an entity within the
meaning of Part 3.6, that:
(a) is a special services provider for the purposes of any of the AFIC
Codes; and
(b) is not excluded by the regulations.
"(2) A building society special services provider is a special services
provider that provides to building societies services of a kind described in
all or any of subparagraphs 36(2)(b)(i), (ii), (iii), (iv) and (v) of any of
the AFIC Codes.
"(3) A credit union special services provider is a special services provider
that provides to credit unions services of a kind described in all or any of
subparagraphs 36(2)(b)(i), (ii), (iii), (iv) and (v) of any of the AFIC Codes.
Withdrawable share
"111AZE. A withdrawable share is a share:
(a) in a society, within the meaning of one of the Financial Institutions
Codes; and
(b) that is, for the purposes of that Code, a withdrawable share in
relation to that society. Division 3 - Whether certain expressions
cover financial institutions Key expressions in this Law - do they
cover financial institutions?
"111AZF.(1) Provisions of this Law apply variously, and contain references,
to:
(a) bodies;
(b) bodies corporate;
(c) companies, recognised companies and foreign companies;
(d) corporations;
(e) persons;
(f) registrable Australian bodies, registrable local bodies and
registrable bodies.
"(2) The following table deals with the extent to which the expressions listed
in subsection (1) cover financial institutions. Item Expression
1 body
Defined in
section 9
Does it cover financial institutions?
Yes.
2 body corporate
section 9
Yes.
3.1 company
section 9
Financial institutions are not companies for the general purposes of this Law
because they are not incorporated under the Corporations Law of this
jurisdiction. Also, they are not covered by any of the paragraphs of the
definition that extend the meaning of 'company' for limited purposes, except
for paragraph (d). Under that paragraph, financial institutions may be
companies for the purposes of Chapter 6.
3.2 recognised company
section 9
No. Financial institutions are not recognised companies because they are not
companies for the general purposes of the Corporations Law of any other
jurisdiction.
3.3 foreign company
section 9
No. Financial institutions are not foreign companies because they are not
formed or incorporated in an external Territory or outside Australia.
4 corporation
section 57A
Because of subsection 57A(3), financial institutions are not corporations,
except for the purposes of Parts 7.11 and 7.12. The application of those Parts
to financial institutions is subject to the exceptions in sections 1015A and
1083A.
5 person
section 85A
Yes.
6.1 registrable Australian body
section 9
No. Financial institutions are not registrable Australian bodies because they
are expressly excluded from the definition.
6.2 registrable local body
section 9
No. Financial institutions are not registrable local bodies because they are
not registrable Australian bodies.
6.3 registrable body
section 9
No. Financial institutions are not registrable bodies
because they are not:
registrable Australian bodies; or
foreign companies. Other expressions
"111AZG. The list of expressions in subsection 111AZF(1) is not exhaustive. If
another expression is used in a provision (for example, 'entity'), the
provision, and any relevant definitions, should be considered in determining
whether the expression covers a financial institution. Examples of how this
Law applies to financial institutions
"111AZH. Some examples of how this Law applies to financial institutions are
set out below.
EXAMPLE 1 A financial institution proposes to issue an invitation to subscribe
for securities. Because the financial institution is a corporation for the
purposes of Part 7.12, it must comply with Division 2 of Part 7.12 (except to
the extent exempted under section 1083A). That Division covers the obligation
to lodge and, in certain circumstances, register, a prospectus before issuing
an invitation to subscribe for securities. Because the financial institution
is also a corporation for the purposes of Part 7.11, criminal liability under
section 996 or civil liability under section 1006 may (subject to the
exemptions under section 1015A) follow if the institution issues a prospectus
that includes a material statement that is false or misleading.
EXAMPLE 2 A director of a financial institution who is interested in a
contract fails to declare the interest to the board. Because the financial
institution is not a corporation for the purposes of Part 3.2, the director's
conduct will not be regulated by section 232. However, the director's conduct
as an officer of the financial institution may be taken into account under
other provisions of Part 3.2, such as section 229. The question of whether the
failure to declare the interest is an offence is dealt with in the relevant
Financial Institutions Code.
EXAMPLE 3 A financial institution proposes to carry on an investment advice
business. The financial institution is a person and so is prohibited by
section 781 from carrying on the investment advice business unless the
institution holds a licence granted under section 784, or is an exempt
investment adviser as defined in section 68. Division only explanatory
"111AZI. This Division is intended to explain the effect of other provisions
of this Law. If a provision of this Division is inconsistent with a provision
of this Law that is outside this Division, the provision outside this Division
prevails.". 25. After section 1015: Insert in Part 7.11:
"Division 5 - Exemptions Financial institutions - exemptions
"1015A.(1) Except as provided in the regulations, nothing in the other
provisions of this Part applies in relation to:
(a) the issue, by a financial institution, of withdrawable shares; or
(b) deposit taking by a financial institution; or
(c) other things done by a financial institution in the ordinary course of
its banking business; or
(d) the provision, by a special services provider, of services of a kind
described in subparagraph 36(2)(b)(i), (ii), (iii), (iv) or (v) of any
of the AFIC Codes; or
(e) the issue of shares:
(i) to a building society by a building society special services
provider; or
(ii) to a credit union by a credit union special services provider.
"(2) In this section:
'banking business', in relation to a financial institution, means that part of
the institution's business that is substantially similar to the banking
businesses of Australian banks.". 26. After subsection 1047(2): Insert:
"(2AA) A financial institution that:
(a) is incorporated under a law of this jurisdiction; and
(b) issues debentures (whether in this jurisdiction or elsewhere); must
keep in Australia a register of holders of those debentures.". 27.
After section 1083: Insert: Financial institutions - exemptions
"1083A.(1) Except as provided in the regulations, nothing in the other
provisions of this Part applies in relation to:
(a) the issue, by a financial institution, of withdrawable shares; or
(b) deposit taking by a financial institution; or
(c) other things done by a financial institution in the ordinary course of
its banking business; or
(d) the provision, by a special services provider, of services of a kind
described in subparagraph 36(2)(b)(i), (ii), (iii), (iv) or (v) of any
of the AFIC Codes; or
(e) the issue of shares:
(i) to a building society by a building society special services
provider; or
(ii) to a credit union by a credit union special services provider.
"(2) In this section:
'banking business', in relation to a financial institution, means that part of
the institution's business that is substantially similar to the banking
businesses of Australian banks.". 28. Subsection 1097(1) (paragraph (a) of the
definition of eligible body"): After "the paragraph, insert:
"(aa) a financial institution that:
(i) is incorporated, formed or established in this jurisdiction;
and
(ii) is included in the official list of a securities exchange; or".
29. Section 1301: After "corporation" (wherever occurring)
insert "or financial institution". 30. Subsection 1302(7): Add
at the end or a financial institution". 31. Subsections 1306(3)
and (4): After "corporation" (wherever occurring), insert "or
financial institution".
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