Corporations Regulations 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

PART 7.5 - COMPENSATION REGIMES FOR FINANCIAL MARKETS  

Division 4 - NGF Compensation regime  

Subdivision 4.3 - Contract guarantees  

REGULATION 7.5.25   CLAIM BY SELLING CLIENT IN RESPECT OF DEFAULT BY SELLING DEALER: TRANSACTION OTHER THAN ASTC-REGULATED TRANSFER  

7.5.25(1)   [ Application]  

This regulation applies to a person (the selling client ) if:

(a) a dealer enters into a reportable transaction on behalf of the selling client; and

(b) the reportable transaction is a sale of securities; and

(c) a transfer of the securities concerned pursuant to the sale would not be an ASTC-regulated transfer; and

(d) at the end of the prescribed period for the transaction:

(i) if subparagraph (ii) does not apply - the selling client has supplied to the dealer settlement documents for the purposes of the sale; and

(ii) if the dealer has been suspended by the participating market licensee concerned or ACH, and that suspension has not been removed - the selling client has supplied, or is ready, willing and able to supply, to the dealer settlement documents for the purposes of the sale; and

(iii) the dealer's obligations to the selling client in respect of the sale, in so far as they relate to the consideration for the sale, have not been discharged.

7.5.25(2)   [ Entitlement to make claim]  

The selling client may make a claim in respect of the sale.

7.5.25(3)   [ Single claim in respect of two or more sales]  

The selling client may make a single claim under this regulation in respect of 2 or more sales.

7.5.25(4)   [ Separate claim in respect of each sale]  

A claim made under subregulation (3) is to be treated for subregulation (5) as if it consisted of a separate claim in respect of each of the sales to which it relates.

7.5.25(5)   [ Obligation to allow claim]  

The SEGC must allow the claim if the SEGC is satisfied that:

(a) subregulation (1) entitles the selling client to make the claim; and

(b) the selling client has:

(i) supplied to the dealer settlement documents in relation to the sale under the agreement for the sale; or

(ii) supplied to the SEGC settlement documents in relation to the sale for the purposes of the claim; and

(c) the dealer's obligations to the selling client in respect of the sale, in so far as they relate to the consideration for the sale, have not been discharged.

7.5.25(6)   [ Obligation to make payment]  

If the SEGC allows a claim, the SEGC must pay to the selling client the amount of the consideration less so much (if any) of the total of any brokerage fees and other charges, and any stamp duty and other duties and taxes, payable by the selling client in connection with the sale as has not already been paid by the selling client.