CORPORATIONS ACT 2001

CHAPTER 2E - RELATED PARTY TRANSACTIONS  

PART 2E.2 - RELATED PARTIES AND FINANCIAL BENEFITS  

SECTION 229   GIVING A FINANCIAL BENEFIT  

229(1)   [ Determination of financial benefit]  

In determining whether a financial benefit is given for the purposes of this Chapter:


(a) give a broad interpretation to financial benefits being given, even if criminal or civil penalties may be involved; and


(b) the economic and commercial substance of conduct is to prevail over its legal form; and


(c) disregard any consideration that is or may be given for the benefit, even if the consideration is adequate.

229(2)   [ ``giving a financial benefit'']  

Giving a financial benefit includes the following:


(a) giving a financial benefit indirectly, for example, through 1 or more interposed entities;


(b) giving a financial benefit by making an informal agreement, oral agreement or an agreement that has no binding force;


(c) giving a financial benefit that does not involve paying money (for example by conferring a financial advantage).

229(3)   [ Examples]  

The following are examples of giving a financial benefit to a related party:


(a) giving or providing the related party finance or property;


(b) buying an asset from or selling an asset to the related party;


(c) leasing an asset from or to the related party;


(d) supplying services to or receiving services from the related party;


(e) issuing securities or granting an option to the related party;


(f) taking up or releasing an obligation of the related party.


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