Income Tax Assessment Act 1936
(a) all membership rights in the mutual insurance company are extinguished; and
(b) not more than 10 shares (the special shares ) in the mutual insurance company are issued to a trustee to hold for the benefit of the policyholder/member group, where:
(i) the issue takes place before the issue of the ordinary shares mentioned in paragraph (c); and
(ii) on the issue of all the ordinary shares, the rights attaching to the special shares become the same as those attaching to the ordinary shares; and
(c) a greater number of shares (the ordinary shares ) of only one class in the mutual insurance company are either:
(i) issued, at the election of each person in the policyholder/member group, to the person or to a trustee to sell on behalf of the person; or
(ii) issued to a trustee, at the election of each person in the policyholder/member group, to distribute to the person or to sell on behalf of the person; and
(d) the trustee sells the ordinary shares and distributes the proceeds to the person, or distributes the ordinary shares to the person; and
(e) the ordinary shares are listed within the listing period.
Other things may also happen in connection with the implementation of the demutualisation.121AG(2) [Diagram of transactions]
The following diagram shows the main events, where this demutualisation method is used involving an election covered by subparagraph (1)(c)(ii).