7   Paragraph 672C(a)

Omit "company, the responsible entity for the scheme or the operator of the fund", substitute "key person for the Chapter 6C body".

8   Section 672E

Omit "company, responsible entity or operator", substitute "key person for a Chapter 6C body".

9   Section 672E

Omit "share in the company, an interest in the listed registered scheme or an interest in the listed notified foreign passport fund", substitute "disclosable security in the Chapter 6C body".

Part 2   Substantial holding information and tracing beneficial ownership (including deemed economic interests)

Division 1   Definitions relating to relevant interests and deemed economic interests

Corporations Act 2001

10   Section 9 (definition of agreement)

After "Chapter 6", insert ", 6C".

11   Section 9

Insert:

deemed economic interest has the meaning given by Division 2 of Part 6C.1A.

offsetting short position has the meaning given by Division 3 of Part 6C.1A.

12   Section 9 (after paragraph (b) of the definition of register)

Insert:

; and (c) register of members of a listed body to which item 5 of the table in section 671A applies includes a register of members under a foreign law.

13   Section 9 (subparagraph (k)(ii) of the definition of remedial order)

After "relevant interests", insert "or deemed economic interests".

14   Subparagraph 12(1)(b)(iii)

After "relevant interests", insert ", deemed economic interests or offsetting short positions".

15   After section 608

Insert:

608A Relevant interests in securities - working out which securities agreement etc. relates to

(1) This section applies if at a particular time all of the following conditions are satisfied:

(a) a person (the first person ) has a relevant interest in a number of issued securities of a particular class in a body, registered scheme or notified foreign passport fund;

(b) the first person (whether before or after acquiring the relevant interest):

(i) has entered or enters into an agreement with another person with respect to securities of that class in the body, scheme or fund; or

(ii) has given or gives another person an enforceable right, or has been or is given an enforceable right by another person, in relation to securities of that class in the body, scheme or fund (whether the right is enforceable presently or in the future and whether or not on the fulfilment of a condition); or

(iii) has granted or grants an option to, or has been or is granted an option by, another person with respect to securities of that class in the body, scheme or fund;

(c) the other person would have a relevant interest in a number of securities of that class in the body, scheme or fund if the agreement were performed, the right enforced or the option exercised.

(2) For the purposes of paragraph 608(8)(b), the agreement is taken to be with respect to, the enforceable right is taken to relate to, or the option is taken to be with respect to, the securities in which the first person has a relevant interest as mentioned in paragraph (1)(a) of this section.

(3) For the purposes of paragraph 608(8)(c), assume that, were the agreement performed, the right enforced or the option exercised, the other person would have a relevant interest in a number of the securities in which the first person has a relevant interest, as mentioned in paragraph (1)(a) of this section, equal to the lesser of:

(a) the number of securities mentioned in paragraph (1)(a); and

(b) the number of securities mentioned in paragraph (1)(c).

Example 1: A person has a relevant interest in 10 shares in a company and agrees with another person to sell 5 shares in the company to the other person on a future date. The other person is taken to already have a relevant interest in 5 of the first person's 10 shares under subsection 608(8).

Example 2: A person has a relevant interest in 10 shares in a company and gives another person a right to acquire 11 shares in the company from the person in the future. The other person is taken to already have a relevant interest in the first person's 10 shares under subsection 608(8). The other person might also have a deemed economic interest in one share in the company under Division 2 of Part 6C.1A.

16   After section 671A

Insert:

Division 2 - Deemed economic interests

Subdivision A - Physically settleable derivatives

671AA Basic rule

Scope of this section

(1) This section applies if, at a particular time, all of the followingconditions are satisfied:

(a) a person (the first person ):

(i) has entered or enters into an agreement with another person; or

(ii) has given or gives another person an enforceable right, or has been or is given an enforceable right by another person, (whether the right is enforceable presently or in the future and whether or not on the fulfilment of a condition); or

(iii) has granted or grants an option to, or has been or is granted an option by, another person;

(b) the agreement is a derivative, the enforceable right is given by a derivative or the option is a derivative;

(c) under the derivative the first person must, or may be required to, provide at some future time consideration of a particular kind or kinds to someone that, if provided, would result in the other person having a relevant interest in a number of securities of a particular class in a Chapter 6C body.

Note: In this Chapter, agreement means a relevant agreement: see section 9.

(2) For the purposes of paragraph (1)(c), do not include in the number of securities:

(a) securities in which the other person has a relevant interest; or

(b) securities that would be issued as, or as part of, the consideration.

Other person has deemed economic interest

(3) Subject to Subdivision C, the other person has a deemed economic interest in the number, mentioned in paragraph (1)(c), of issued securities of that class in the Chapter 6C body.

671AB Extension to controlling disposal of derivatives

Scope of this section

(1) This section applies if:

(a) a person (the first person ) has a deemed economic interest in a number of issued securities of a particular class in a Chapter 6C body under this Subdivision because of a derivative; and

(b) another person has power:

(i) to dispose of; or

(ii) to control the exercise of a power to dispose of;

the derivative.

If 2 or more persons can jointly exercise one of the powers mentioned in paragraph (b), each of them is taken to have that power.

Other person has deemed economic interest

(2) Subject to Subdivision C, the other person has a deemed economic interest in the number, mentioned in paragraph (1)(a), of issued securities of that class in the Chapter 6C body.

Power or control

(3) In this section, power or control includes:

(a) power or control that is indirect; and

(b) power or control that is, or can be, exercised as a result of, by means of or by the revocation or breach of:

(i) a trust; or

(ii) an agreement; or

(iii) a practice; or

(iv) any combination of them;

whether or not they are enforceable; and

(c) power or control that is, or can be made, subject to restraint or restriction.

It does not matter whether the power or control is express or implied, formal or informal or exercisable alone or jointly with someone else. It does not matter that the power or control cannot be related to a particular derivative.

671AC Extension to deemed economic interests held through bodies corporate

Scope of this section

(1) This section applies if:

(a) a body corporate or managed investment scheme (the first person ) has a deemed economic interest in a number of issued securities of a particular class in a Chapter 6C body under this Subdivision; and

(b) either or both of the following subparagraphs apply:

(i) another person's voting power in the first person is above 20%;

(ii) another person controls the first person.

(2) Subparagraph (1)(b)(i) does not apply if the deemed economic interest mentioned in paragraph (1)(a) is a deemed economic interest that the first person itself has merely because of the operation of this section (disregarding subparagraph (1)(b)(ii)) in relation to another body corporate or managed investment scheme.

Other person has deemed economic interest

(3) Subject to Subdivision C, the other person has the deemed economic interest mentioned in paragraph (1)(a).

Control

(4) For the purposes of subparagraph (1)(b)(ii), a person controls a body corporate if the person has the capacity to determine the outcome of decisions about the body corporate's financial and operating policies.

(5) In determining whether a person has this capacity:

(a) the practical influence the person can exert (rather than the rights the person can enforce) is the issue to be addressed; and

(b) any practice or pattern of behaviour affecting the body corporate's financial or operating policies is to be taken into account (even if it involves a breach of an agreement or a breach of trust).

(6) A person does not control the body corporate merely because the person and an entity that is not an associate jointly have the capacity to determine the outcome of decisions about the body corporate's financial and operating policies.

(7) A person is not taken to control a body corporate merely because of a capacity the person has if the person is under a legal obligation to exercise that capacity for the benefit of:

(a) if the person is an individual - someone else; or

(b) if the person is a body corporate - someone other than its members.

671AD Extension to control in anticipation of performance of agreements etc.

Scope of this section

(1) This section applies if, at a particular time, all of the following conditions are satisfied:

(a) a person (the first person ) has a deemed economic interest in a number of issued securities of a particular class in a Chapter 6C body because of a derivative;

(b) the first person (whether before or after acquiring the deemed economic interest):

(i) has entered or enters into an agreement with another person with respect to the derivative; or

(ii) has given or gives another person an enforceable right, or has been or is given an enforceable right by another person, inrelation to the derivative (whether the right is enforceable presently or in the future and whether or not on the fulfilment of a condition); or

(iii) has granted or grants an option to, or has been or is granted an option by, another person with respect to the derivative;

(c) the other person would have a deemed economic interest in a number of issued securities of that class in the Chapter 6C body under this Subdivision if the agreement were performed, the right enforced or the option exercised.

Other person has deemed economic interest

(2) Subject to Subdivision C, the other person is taken to already have a deemed economic interest in the number, mentioned in paragraph (1)(c), of securities of that class in the Chapter 6C body.

671AE Extensions - no double-counting

(1) This section applies for the purposes of section 671AB, 671AC or 671AD (the extension provision ).

(2) In applying paragraph 671AA(1)(c) for the purposes of the extension provision, do not include in the number of securities any securities in which the other person mentioned in the extension provision has a relevant interest.

Subdivision B - Non-physically settleable derivatives

671AF Basic rule

Scope of this section

(1) This section applies if, at a particular time, all of the following conditions are satisfied:

(a) a person (the first person ) has entered or enters into an arrangement with another person;

(b) the arrangement is a derivative;

(c) the consideration that the first person must, or may be required to, provide at some future time under the derivative to someone, or the value of the derivative:

(i) is ultimately determined by; or

(ii) is ultimately derived from; or

(iii) varies by reference to;

the value of issued securities of a particular class in a Chapter 6C body (wholly or in part);

(d) either or both of the following subparagraphs apply:

(i) the derivative gives the other person, in economic substance, the financial benefits of holding issued securities in the class for a period determined under the derivative;

(ii) under the derivative, the other person might benefit if the value of issued securities in the class increases (rather than decreases).

(2) For the purposes of subparagraph (1)(d)(i), the derivative is taken not to give the other person the financial benefits of holding:

(a) securities in which the other person has a relevant interest; or

(b) a number of securities in which the other person has a deemed economic interest under Subdivision A (or would have apart from paragraph 671AA(2)(b)).

(3) For the purposes of subparagraph (1)(d)(ii), disregard a benefit:

(a) to the extent that it relates to securities in which the other person has a relevant interest; or

(b) if the other person has a deemed economic interest in securities of the class in the Chapter 6C body under section 671AA because of the derivative (or would have apart from paragraph 671AA(2)(b)) - to the extent that the benefit would result from the requirement described in paragraph 671AA(1)(c).

(4) For the purposes of subparagraph (1)(d)(ii), disregard any benefit to the other person that might occur under the derivative if the value of issued securities in the class decreases (rather than increases) (including a benefit that offsets, in whole or in part, any detriment to the other person that occurs under the derivative because of the decrease).

Other person has deemed economic interest

(5) Subject to Subdivision C, the other person has a deemed economic interest in the number of issued securities of that class in the Chapter 6C body determined under section 671AK.

Determinations

(6) Subsections (2) to (4) of this section do not limit section 671AK.

671AG Extension to controlling disposal of derivatives

Scope of this section

(1) This section applies if:

(a) a person (the first person ) has a deemed economic interest in a number of issued securities of a particular class in a Chapter 6C body under this Subdivision because of a derivative; and

(b) another person has the power:

(i) to dispose of; or

(ii) to control the exercise of a power to dispose of;

the derivative.

If 2 or more persons can jointly exercise one of the powers mentioned in paragraph (b), each of them is taken to have that power.

Other person has deemed economic interest

(2) Subject to Subdivision C, the other person has a deemed economic interest in the following number of issued securities of that class in the Chapter 6C body:

(a) the number determined under section 671AK;

(b) if no number is determined - the number mentioned in paragraph (1)(a) of this section.

Power or control

(3) In this section, power or control includes:

(a) power or control that is indirect; and

(b) power or control that is, or can be, exercised as a result of, by means of or by the revocation or breach of:

(i) a trust; or

(ii) an agreement; or

(iii) a practice; or

(iv) any combination of them;

whether or not they are enforceable; and

(c) power or control that is, or can be made, subject to restraint or restriction.

It does not matter whether the power or control is express or implied, formal or informal or exercisable alone or jointly with someone else. It does not matter that the power or control cannot be related to a particular derivative.

671AH Extension to deemed economic interests held through bodies corporate

Scope of this section

(1) This section applies if:

(a) a body corporate or managed investment scheme (the first person ) has a deemed economic interest in a number of issued securities of a particular class in a Chapter 6C body under this Subdivision; and

(b) either or both of the following subparagraphs apply:

(i) another person's voting power in the first person is above 20%;

(ii) another person controls the first person.

(2) Subparagraph (1)(b)(i) does not apply if the deemed economic interest mentioned in paragraph (1)(a) is a deemed economic interest that the first person itself has merely because of the operation of this section (disregarding subparagraph (1)(b)(ii)) in relation to another body corporate or managed investment scheme.

Other person has deemed economic interest

(3) Subject to Subdivision C, the other person has a deemed economic interest in the following number of issued securities of that class in the Chapter 6C body:

(a) the number determined under section 671AK;

(b) if no number is determined - the number mentioned in paragraph (1)(a) of this section.

Control

(4) For the purposes of subparagraph (1)(b)(ii) of this section, a person controls a body corporate if the person has the capacity to determine the outcome of decisions about the body corporate's financial and operating policies.

(5) In determining whether a person has this capacity:

(a) the practical influence the person can exert (rather than the rights the person can enforce) is the issue to be addressed; and

(b) any practice or pattern of behaviour affecting the body corporate's financial or operating policies is to be taken into account (even if it involves a breach of an agreement or a breach of trust).

(6) A person does not control the body corporate merely because the person and an entity that is not an associate jointly have the capacity to determine the outcome of decisions about the body corporate's financial and operating policies.

(7) A person is not taken to control a body corporate merely because of a capacity the person has if the person is under a legal obligation to exercise that capacity for the benefit of:

(a) if the person is an individual - someone else; or

(b) if the person is a body corporate - someone other than its members.

671AI Extension to control in anticipation of performance of agreements etc.

Scope of this section

(1) This section applies if, at a particular time, all of the following conditions are satisfied:

(a) a person (the first person ) has a deemed economic interest in a number of issued securities of a particular class in a Chapter 6C body because of a derivative;

(b) the first person (whether before or after acquiring the deemed economic interest):

(i) has entered or enters into an agreement with another person with respect to the derivative; or

(ii) has given or gives another person an enforceable right, or has been or is given an enforceable right by another person, in relation to the derivative (whether the right is enforceable presently or in the future and whether or not on the fulfilment of a condition); or

(iii) has granted or grants an option to, or has been or is granted an option by, another person with respect to the derivative;

(c) the other person would have a deemed economic interest in a number of issued securities of that class in the Chapter 6C body under this Subdivision if the agreement were performed, the right enforced or the option exercised.

Other person has deemed economic interest

(2) Subject to Subdivision C, the other person is taken to already have a deemed economic interest in the following number of securities of that class in the Chapter 6C body:

(a) the number determined under section 671AK;

(b) if no number is determined - the number mentioned in paragraph (1)(c) of this section.

671AJ Extensions - no double-counting

(1) This section applies for the purposes of section 671AG, 671AH or 671AI (the extension provision ).

(2) In applying subparagraph 671AF(1)(d)(i) for the purposes of the extension provision, a derivative is taken not to give the other person mentioned in that subparagraph the financial benefits of holding:

(a) securities in which the other person mentioned in the extension provision has a relevant interest; or

(b) a number of securities in which the other person mentioned in the extension provision has a deemed economic interest under Subdivision A (or would have apart from paragraph 671AA(2)(b)).

(3) In applying subparagraph 671AF(1)(d)(ii) for the purposes of the extension provision, disregard a benefit:

(a) to the extent that it relates to securities in which the other person mentioned in the extension provision has a relevant interest; or

(b) if the other person mentioned in the extension provision has a deemed economic interest in securities of the class in the Chapter 6C body under section 671AA because of the derivative (or would have apart from paragraph 671AA(2)(b)) - to the extent that the benefit would occur because of the requirement described in paragraph 671AA(1)(c).

671AK Determinations

(1) For the purposes of subsection 671AF(5) or paragraph 671AG(2)(a), 671AH(3)(a) or 671AI(2)(a), ASIC may, by legislative instrument, determine the number, or a method of working out the number, of issued securities in which a person has a deemed economic interest.

Note: The number may be zero.

(2) Without limiting subsection (1) of this section, a method determined under that subsection may:

(a) provide for the person to choose between different specified methods, or between methods that meet specified requirements; or

(b) require the number of issued securities to be recalculated:

(i) in specified circumstances; or

(ii) at a specified time.

Subdivision C - Situations not giving rise to deemed economic interests

671AL Money lending and financial accommodation

(1) A person does not have a deemed economic interest in a number of securities merely because of a security interest taken or acquired by the person, if:

(a) the security interest is taken or acquired:

(i) in the ordinary course of the person's business of the provision of financial accommodation by any means and on ordinary commercial terms; or

(ii) for the benefit of one or more other persons in relation to financial accommodation provided by the other persons in the ordinary course of their business of the provision of financial accommodation by any means and on ordinary commercial terms; and

(b) the person whose property is subject to the security interest is not an associate of any other person mentioned in this subsection.

(2) In this section, a reference to a security interest includes a reference to a negative pledge.

671AM Nominees and other trustees

A person who would otherwise have a deemed economic interest in a number of securities as a bare trustee does not have a deemed economic interest in the number of securities if a beneficiary under the trust has a deemed economic interest in the number of securities because of a presently enforceable and unconditional right of the kind referred to in section 671AD or 671AI.

Note: This section will often apply to a person who holds derivatives as a nominee.

671AN Directors of bodies corporate

A person does not have a deemed economic interest in a number of securities merely because:

(a) the person is a director of a body corporate; and

(b) the body corporate has a deemed economic interest in a number of those securities.

671AO Client services and market making

(1) A person does not have a deemed economic interest in a number of securities in a Chapter 6C body in the circumstances determined under subsection (2).

(2) Subject to subsections (3) and (4), ASIC may, by legislative instrument, determine circumstances for the purposes of subsection (1) in relation to securities in a Chapter 6C body.

(3) The circumstances must relate to a transaction entered into:

(a) in the ordinary course of a business carried on by:

(i) an Australian ADI; or

(ii) a financial services licensee; or

(iii) a CS facility licensee; or

(iv) an equivalent, under a foreign law, of an Australian ADI, financial services licensee or CS facility licensee; and

(b) for the purposes of:

(i) facilitating the obtaining by a client, at the client's request, of economic exposure to changes in the value of securities; or

(ii) making a market in securities or derivatives; or

(iii) hedging a position, or otherwise managing a risk, created by another transaction to which this subsection applies.

(4) ASIC may determine circumstances under subsection (2) if ASIC believes that doing so would be appropriate, having regard to the following matters:

(a) the nature of the information that, apart from the determination, would be required to be given under this Act because a person has a deemed economic interest in the securities in those circumstances, including:

(i) the frequency with which the information would be required to be given; and

(ii) the extent to which giving the information would benefit investors and market participants; and

(iii) whether giving the information would reduce the usefulness of other information given under this Act;

(b) the likelihood that, and extent to which, in those circumstances:

(i) the entity mentioned in paragraph (3)(a); or

(ii) an associate of the entity mentioned in paragraph (3)(a);

would exercise a capacity to determine, would influence, or would attempt to influence, the outcome of decisions about the Chapter 6C body's financial and operating policies;

(c) the nature and size of the economic exposure of the entity mentioned in paragraph (3)(a) to changes in the value of the securities in those circumstances;

(d) whether the entity mentioned in paragraph (3)(a) has adequate systems to distinguish between transactions to which subsection (3) applies and other transactions;

(e) any other matter ASIC considers relevant.

Requirement to give information

(5) The determination may require a person who would have a deemed economic interest apart from the determination to give specified information or documents to a specified person.

(6) A person must comply with a requirement included in the determination under subsection (5).

Note: Failure to comply with this subsection is an offence: see subsection 1311(1).

671AP Arrangements between related bodies corporate

Section 671AA, 671AB, 671AC, 671AD, 671AF, 671AG, 671AH or 671AI does not apply in relation to a derivative if:

(a) the first person mentioned in that section; and

(b) the other person mentioned in that section; and

(c) all other persons (if any) who would, apart from this section, have deemed economic interests because of the derivative;

are bodies corporate that are related to each other.

671AQ Prescribed exclusions

A person does not have a deemed economic interest in a number of securities in the circumstances specified in the regulations for the purposes of this section.

Subdivision D - Other provisions

671AR Chapter 6C body may have deemed economic interest in its own securities

This Division may result in a Chapter 6C body having a deemed economic interest in its own securities.

Division 3 - Offsetting short positions

Subdivision A - Offsetting short positions

671AS Basic rule

Scope of this section

(1) This section applies if, at a particular time, all of the following conditions are satisfied:

(a) a person has entered or enters into an arrangement with another person;

(b) the arrangement is a derivative;

(c) the consideration that the person must, or may be required to, provide at some future time under the derivative to someone, or the value of the derivative:

(i) is ultimately determined by; or

(ii) is ultimately derived from; or

(iii) varies by reference to;

the value of issued securities of a particular class in a Chapter 6C body (wholly or in part);

(d) under the derivative, the other person might benefit if the value of issued securities in the class decreases (rather than increases).

(2) For the purposes of paragraph (1)(d), disregard any benefit to the person that might occur under the derivative if the value of issued securities in the class increases (rather than decreases) (including a benefit that offsets, in whole or in part, any detriment to the person that occurs under the derivative because of the increase).

Other person has offsetting short position

(3) Subject to Subdivision B, the other person has an offsetting short position in the number of issued securities of that class in the Chapter 6C body determined under section 671AW.

Determinations

(4) Subsection (2) does not limit section 671AW.

671AT Extension to controlling disposal of derivatives

Scope of this section

(1) This section applies if:

(a) a person (the first person ) has an offsetting short position in a number of issued securities of a particular class in a Chapter 6C body because of a derivative; and

(b) another person has power:

(i) to dispose of; or

(ii) to control the exercise of a power to dispose of;

the derivative.

If 2 or more persons can jointly exercise one of the powers mentioned in paragraph (b), each of them is taken to have that power.

Other person has offsetting short position

(2) Subject to Subdivision B, the other person has an offsetting short position in the number of issued securities of that class in the Chapter 6C body determined under section 671AW.

Power or control

(3) In this section, power or control includes:

(a) power or control that is indirect; and

(b) power or control that is, or can be, exercised as a result of, by means of or by the revocation or breach of:

(i) a trust; or

(ii) an agreement; or

(iii) a practice; or

(iv) any combination of them;

whether or not they are enforceable; and

(c) power or control that is, or can be made, subject to restraint or restriction.

It does not matter whether the power or control is express or implied, formal or informal or exercisable alone or jointly with someone else. It does not matter that the power or control cannot be related to a particular derivative.

671AU Extension to offsetting short positions held through bodies corporate

Scope of this section

(1) This section applies if:

(a) a body corporate or managed investment scheme (the first person ) has an offsetting short position in a number of issued securities of a particular class in a Chapter 6C body; and

(b) either or both of the following subparagraphs apply:

(i) another person's voting power in the first person is above 20%;

(ii) another person controls the first person.

(2) Subparagraph (1)(b)(i) does not apply if the offsetting short position mentioned in paragraph (1)(a) is an offsetting short position that the first person itself has merely because of the operation of this section (disregarding subparagraph (1)(b)(ii)) in relation to another body corporate or managed investment scheme.

Other person has offsetting short position

(3) Subject to Subdivision B, the other person has an offsetting short position in the number of issued securities of the class in the Chapter 6C body determined under section 671AW.

Control

(4) For the purposes of subparagraph (1)(b)(ii) of this section, a person controls a body corporate if the person has the capacity to determine the outcome of decisions about the body corporate's financial and operating policies.

(5) In determining whether a person has this capacity:

(a) the practical influence the person can exert (rather than the rights the person can enforce) is the issue to be addressed; and

(b) any practice or pattern of behaviour affecting the body corporate's financial or operating policies is to be taken into account (even if it involves a breach of an agreement or a breach of trust).

(6) A person does not control the body corporate merely because the person and an entity that is not an associate jointly have the capacity to determine the outcome of decisions about the body corporate's financial and operating policies.

(7) A person is not taken to control a body corporate merely because of a capacity the person has if the person is under a legal obligation to exercise that capacity for the benefit of:

(a) if the person is an individual - someone else; or

(b) if the person is a body corporate - someone other than its members.

671AV Extension to control in anticipation of performance of agreements etc.

Scope of this section

(1) This section applies if, at a particular time, all of the following conditions are satisfied:

(a) a person (the first person ) has an offsetting short position in a number of issued securities of a particular class in a Chapter 6C body because of a derivative;

(b) the first person (whether before or after acquiring the deemed economic interest):

(i) has entered or enters into an agreement with another person with respect to the derivative; or

(ii) has given or gives another person an enforceable right, or has been or is given an enforceable right by another person, in relation to the derivative (whether the right is enforceable presently or in the future and whether or not on the fulfilment of a condition); or

(iii) has granted or grants an option to, or has been or is granted an option by, another person with respect to the derivative;

(c) the other person would have an offsetting short position in a number of issued securities of that class in the Chapter 6C body if the agreement were performed, the right enforced or the option exercised.

Other person has offsetting short position

(2) Subject to Subdivision B, the other person is taken to already have an offsetting short position in a number of securities of that class in the Chapter 6C body determined under section 671AW.

671AW Determinations

(1) For the purposes of subsection 671AS(3), 671AT(2), 671AU(3) or 671AV(2), ASIC may, by legislative instrument, determine the number, or a method of working out the number, of issued securities in which a person has an offsetting short position.

Note: The number may be zero.

(2) Without limiting subsection (1) of this section, a method determined under that subsection may:

(a) provide for the person to choose between different specified methods, or between methods that meet specified requirements; or

(b) require the number of issued securities to be recalculated:

(i) in specified circumstances; or

(ii) at a specified time.

Subdivision B - Situations not giving rise to offsetting short positions

671AX Prescribed exclusions

A person does not have an offsetting short position in a number of securities in the circumstances specified in the regulations for the purposes of this section.

17   Schedule 3 (before table item dealing with subsection 671B(8))

Insert:

Division 2   Substantial holding information

Corporations Act 2001

18   Section 9

Insert:

deemed non-physically settleable derivative-based holding percentage has the meaning given by subsection 671BL(1).

deemed physically settleable derivative-based holding percentage has the meaning given by subsection 671BL(1).

derivative-based holding percentage has the meaning given by subsection 671BL(5).

disclosable movement has the meaning given by section 671BK.

evidential burden , in relation to a matter, means the burden of adducing or pointing to evidence that suggests a reasonable possibility that the matter exists or does not exist.

holding percentage has the meaning given by subsection 671BL(1).

offsetting short position percentage has the meaning given by section 671BM.

relatable derivative-based holding percentage has the meaning given by subsection 671BL(1).

19   Subsection 588GA(7) (definition of evidential burden)

Repeal the definition.

20   Subsections 588GAAA(4), 588GAAB(4), 588GAAC(4), 588WA(3) and 596AC(11)

Repeal the subsections.

21   Part 6C.1

Repeal the Part, substitute:

Part 6C.1 - Substantial holding information

Division 1 - Requirement to give substantial holding information

671B Information about substantial holdings in Chapter 6C bodies must be given to key persons and market operators

Situations that trigger requirement to give information

(1) This section applies if any of the following situations arise:

(a) a person begins to have, or ceases to have, a substantial holding in a Chapter 6C body;

(b) a person has a substantial holding in a Chapter 6C body when the Chapter 6C body begins to be a Chapter 6C body;

(c) a person has a substantial holding in a Chapter 6C body and there is a disclosable movement in the person's holding;

(d) a person is the bidder for a takeover bid for securities in a Chapter 6C body and the bid period for the bid starts.

Note: Section 9 defines substantial holding . See also section 671D.

(2) Paragraph (1)(d) does not apply if the Chapter 6C body is a listed notified foreign passport fund.

Requirement to give information

(3) The person must, in accordance with this section and sections 671BA, 671BE and 671BF, give the information referred to in section 671BB to:

(a) the key person for the Chapter 6C body; and

(b) each relevant market operator.

Note: The information must be given even if the situation changes by the time the information is to be given.

Fault-based offence

(4) A person commits an offence if the person contravenes subsection (3) of this section.

Strict liability offence

(5) A person commits an offence of strict liability if the person contravenes subsection (3) of this section.

671BA Deadline for giving information

(1) A person who must give information under subsection 671B(3) because of a situation that arises in relation to a Chapter 6C body must give the information:

(a) if paragraph (b) of this subsection does not apply - within 2 business days after the person becomes aware of the situation; or

(b) by 9.30 am on the next trading day of the relevant financial market after the person becomes aware of the situation, if:

(i) the bid period for a takeover bid for voting securities in the Chapter 6C body starts; and

(ii) the person becomes aware of the situation during the bid period.

(2) For the purposes of subsection (1), a person who ought reasonably to be aware of a situation is taken to be aware of the situation.

(3) Paragraph (1)(b) does not apply if the Chapter 6C body is a listed notified foreign passport fund.

Division 2 - Information that must be given etc.

Subdivision A - Information that must be given

671BB Information that must be given

(1) Subject to sections 671BC and 671BD, for the purposes of subsection 671B(3), the information that a person must give because of a situation that arises in relation to a Chapter 6C body is:

(a) the person's name and address; and

(b) details of the person's relevant interests and deemed economic interests in voting securities in the Chapter 6C body, including:

(i) the person's holding percentage in the Chapter 6C body; and

(ii) the person's derivative-based holding percentage in the Chapter 6C body; and

(iii) if the person's derivative-based holding percentage is greater than nil - the person's relatable derivative-based holding percentage, deemed physically settleable derivative-based holding percentage and deemed non-physically settleable derivative-based holding percentage in the Chapter 6C body; and

(iv) if the person's derivative-based holding percentage is greater than nil - details of any offsetting short positions of the person in voting securities in the Chapter 6C body, including the person's offsetting short position percentage in the Chapter 6C body; and

(c) details of any agreement through which the person would have a relevant interest or deemed economic interest in voting securities in the Chapter 6C body; and

(d) the name of each associate of the person who has a relevant interest or deemed economic interest in voting securities in the Chapter 6C body, together with details of:

(i) the nature of the person's association with the associate; and

(ii) the relevant interest or deemed economic interest of the associate; and

(iii) any agreement through which the associate has the relevant interest or deemed economic interest; and

(e) if the situation is a disclosable movement:

(i) the size and date of the disclosable movement; and

(ii) details of each transaction that resulted in the disclosable movement; and

(f) if the information is being given because a person has ceased to be an associate of the person - the name of the person who ceased to be an associate; and

(g) any other particulars determined under subsection (3) of this section for the purposes of this paragraph in relation to the Chapter 6C body.

Note: Section 671E expands the normal concept of relevant interest to take account of conditional agreements and escrow.

(2) For the purposes of subparagraph (1)(e)(ii), the person may give the details of 2 or more on-market transactions on an aggregate basis if the transactions:

(a) occurred:

(i) on the same day; and

(ii) on the same declared financial market; and

(b) are either:

(i) all acquisitions; or

(ii) all disposals;

of quoted securities or other financial products of the same class.

If the person does so, the details must include:

(c) the highest and lowest value (on a per-security or per-financial product basis) of the consideration under those transactions; and

(d) the total value of the consideration under those transactions.

(3) For the purposes of paragraph (1)(g), ASIC may, by legislative instrument, determine particulars in relation to the Chapter 6C body.

671BC Exception - persons who take reasonable steps to know information

(1) This section applies if:

(a) a person takes all reasonable steps to ensure that, were:

(i) a situation referred to in subsection 671B(1) to arise at a future time; and

(ii) the person to be required to give information under subsection 671B(3) because of that situation;

the person would know or be reasonably able to know, by the time required by section 671BA, the information the person would (disregarding this section) be required to give; and

(b) a situation referred to in subsection 671B(1) arises at that time and the person is required to give information under subsection 671B(3) because of that situation.

(2) Despite section 671BB, information referred to in that section does not need to be given to the extent to which the person does not know, and is not reasonably able to know, the information.

(3) A person who wishes to rely on subsection (2) of this section in a proceeding for, or relating to, a contravention of subsection 671B(3) bears an evidential burden in relation to the matters in subsections (1) and (2) of this section.

671BD Exception - information relating to takeover bids

(1) This section applies in relation to a person (the discloser ) who is required to give information under subsection 671B(3).

(2) Despite section 671BB, the discloser is not required to give the name or address of a person (other than the discloser), if:

(a) the only reason the discloser would, apart from this section, be required to give the name and address is that the person has accepted an offer made under a takeover bid; and

(b) at the time the discloser gives the information, the person is shown, in the Chapter 6C body's register of members, as holding the securities to which the acceptance of the offer relates.

671BE Information must be given in approved manner and form

(1) A person who must give information under subsection 671B(3) must give the information in the manner (if any) and form (if any) approved under subsection (2) of this section.

(2) For the purposes of subsection (1), ASIC may, in writing, approve a manner or form (including a machine-readable form) for giving the information.

Subdivision B - Accompanying documents and statements

671BF Accompanying documents and statements

(1) For the purposes of subsection 671B(3), and subject to section 671BG, the information that a person must give because of a situation that arises in relation to a Chapter 6C body must be accompanied by the following:

(a) for each agreement (if any):

(i) that contributed to the situation; and

(ii) for which there is one or more documents that set out the terms of the agreement, are in writing and are readily available to the person;

a copy of each document to which subparagraph (ii) of this paragraph applies, endorsed in accordance with subsection (2);

(b) for each contract, scheme or arrangement (if any) that:

(i) contributed to the situation; and

(ii) is not both in writing and readily available to the person; and

(iii) is not an agreement to which paragraph (a) of this subsection applies;

a statement by the person giving full details of the contract, scheme or arrangement.

(2) For the purposes of paragraph (1)(a), each copy must be endorsed with a statement that the copy is a true copy.

671BG Exceptions

(1) This section applies if a person is required to give information under subsection 671B(3).

(2) The information does not need to be accompanied by the copies or statements referred to in section 671BF if the transaction that gives rise to the person needing to provide the information takes place on a declared financial market.

(3) If:

(a) the person who must give the information is:

(i) the bidder under a takeover bid; or

(ii) an associate of the bidder under a takeover bid; and

(b) an agreement that contributed to the situation giving rise to the person needing to provide the information includes the acceptance of offers under the bid;

the information is not required to be accompanied by a copy of:

(c) the bidder's statement; or

(d) the takeover offer document; or

(e) any acceptance form.

(4) The information does not need to be accompanied by a copy of a document referred to in paragraph 671BF(1)(a) if:

(a) the document is in a form determined under subsection (5) of this section; and

(b) the information is accompanied by a statement that:

(i) identifies any differences between the document and the form; and

(ii) contains any information included in the document that is provided for, but not set out in, the form (for example, information included in any blank space the form requires to be filled in); and

(iii) states the date the document was executed.

(5) For the purposes of paragraph (4)(a), ASIC may, by legislative instrument, determine a form of a document if ASIC considers the form to be a standard form for documents of a particular kind.

(6) The information does not need to be accompanied by a copy of a document, or a statement, referred to in subsection 671BF(1) if:

(a) a copy of the document, or the statement, accompanied information previously given by the person or another person under subsection 671B(3); and

(b) the document (or a copy of the document) or the statement is publicly available; and

(c) the information is accompanied by a statement that identifies:

(i) the document or statement; and

(ii) the information mentioned in paragraph (a) of this subsection.

(7) If the information is required under paragraph 671BF(1)(a) to be accompanied by a copy of a document, the information may instead be accompanied by a copy of the document that (after the copy is endorsed with a statement that the copy is a true copy) has had removed from it information that it is necessary to remove to prevent the copy from disclosing:

(a) the signature of an individual; or

(b) a phone number; or

(c) an email address; or

(d) a physical address.

(8) Subsection (9) applies if, before the time the person is required to give the information mentioned in subsection (1), the person took all reasonable steps to ensure that, were:

(a) a situation referred to in subsection 671B(1) to arise at that time; and

(b) the person to be required to give information under subsection 671B(3) because of that situation; and

(c) the information to be required to be accompanied by a statement under paragraph 671BF(1)(b);

the person would know or be reasonably able to know, by the time required by section 671BA, the details the person would (disregarding subsection (9) of this section) be required to include in the statement.

(9) The information does not need to be accompanied by a statement referred to in paragraph 671BF(1)(b) to the extent that the person does not know, and is not reasonably able to know, the details that (apart from this subsection) would be required to be included in the statement.

(10) A person who wishes to rely on subsection (9) of this section in a proceeding for, or relating to, a contravention of subsection 671B(3) bears an evidential burden in relation to the matters in subsections (8) and (9) of this section.

Subdivision C - Additional obligations

671BH Requirement to give documents on request - takeover bids

(1) This section applies if:

(a) the bidder under a takeover bid gives information in compliance with subsection 671B(3); and

(b) apart from section 671BD, the bidder would contravene subsection 671B(3) because:

(i) subsection 671BB(1) requires the information to include the name and address of a particular person; and

(ii) the information does not include that name and address.

(2) The target of the takeover bid may request the bidder in writing to give the following information to the target:

(a) the name and address of each person who:

(i) has accepted the offer under the bid; and

(ii) when the bidder gives the information to the target, remains a registered holder of the securities to which the acceptance of the offer relates; and

(b) for each such person - the number of securities held by the person in respect of which the bidder has a relevant interest because of the person's acceptance of the offer under the bid.

(3) The bidder must give the information to the target on or before the first business day after the bidder receives the request.

Note: Section 1325A provides that a Court may make certain orders (including remedial orders) if the bidder contravenes this subsection.

671BI Requirement to give documents on request - person who gives information

(1) This section applies in relation to information and a document if:

(a) a person (the discloser ) gives the information in compliance with subsection 671B(3); and

(b) apart from subsection 671BG(4), the discloser would contravene subsection 671B(3) because:

(i) paragraph 671BF(1)(a) requires the information to be accompanied by a copy of the document; and

(ii) the information is not accompanied by a copy of the document.

(2) A person may request the discloser in writing to give a copy of the document to the person.

(3) The request must be made within 7 years after the discloser gives the information.

(4) The discloser must give to the person a copy of the document within 7 days after the discloser receives the request. The copy must be endorsed with a statement that the copy is a true copy.

Note: Failure to comply with this subsection is an offence: see subsection 1311(1).

(5) Subsection 671BG(7) applies in relation to giving a copy under subsection (4) of this section in the same way as subsection 671BG(7) applies in relation to a copy under paragraph 671BF(1)(a).

(6) Subsection (4) of this section does not apply if:

(a) the document, or a copy of the document, is readily available to the person who makes the request; or

(b) both:

(i) subsection 671BJ(1) applies in relation to the information and the document; and

(ii) the document is not in the discloser's possession.

Note: A defendant bears an evidential burden in relation to the matters in this subsection: see subsection 13.3(3) of the Criminal Code.

671BJ Requirement to give documents on request - nominated person

(1) This section applies in relation to information and a document if:

(a) a person (the discloser ) gives the information in compliance with subsection 671B(3); and

(b) apart from subsection 671BG(4), the discloser would contravene subsection 671B(3) because:

(i) paragraph 671BF(1)(a) requires the information to be accompanied by a copy of the document; and

(ii) the information is not accompanied by a copy of the document; and

(c) the information is accompanied by a statement that complies with subsection (2) of this section in relation to another person (the nominated person ).

(2) For the purposes of paragraph (1)(c), the statement:

(a) must:

(i) state that queries about the information may be made to the nominated person, and not expressly exclude making to the nominated person a request for a copy of the document; or

(ii) state that a copy of the document may be obtained on request from the nominated person; and

(b) must:

(i) be made with the consent of the nominated person; and

(ii) state that it is so made.

(3) A person may request the nominated person in writing to give a copy of the document to the person.

(4) The request must be made within 7 years after the discloser gives the information.

(5) The nominated person must give to the person a copy of the document within 7 days after the nominated person receives the request. The copy must be endorsed with a statement that the copy is a true copy.

Note: Failure to comply with this subsection is an offence: see subsection 1311(1).

(6) Subsection 671BG(7) applies in relation to giving a copy under subsection (5) of this section in the same way as subsection 671BG(7) applies in relation to a copy under paragraph 671BF(1)(a).

(7) Subsection (5) of this section does not apply if the document, or a copy of the document, is readily available to the person who makes the request.

Note: A defendant bears an evidential burden in relation to the matter in this subsection: see subsection 13.3(3) of the Criminal Code.

Division 3 - Definitions

671BK Meaning of disclosable movement in substantial holding

(1) There is a disclosable movement in a person's substantial holding in a Chapter 6C body if:

(a) both:

(i) the person has previously disclosed, or been required to disclose, under this Part the person's holding percentage or derivative-based holding percentage in the Chapter 6C body; and

(ii) that percentage increases or decreases by 1 or more percentage points from the percentage the person last disclosed; or

(b) both:

(i) the person has previously disclosed, or been required to disclose, under this Part any 2 or more of the person's relatable derivative-based holding percentage, deemed physically settleable derivative-based holding percentage and deemed non-physically settleable derivative-based holding percentage in the Chapter 6C body; and

(ii) any of those percentages increases or decreases by 1 or more percentage points from the percentage the person last disclosed, and there is a corresponding change in the other percentage, or either or both of the other percentages, that the person previously disclosed; or

(c) all of the following subparagraphs apply:

(i) the person has previously disclosed, or been required to disclose, under this Part the person's offsetting short position percentage in the Chapter 6C body;

(ii) that percentage increases or decreases by 1 or more percentage points from the percentage the person last disclosed;

(iii) if the percentage increases - immediately after the increase, the person's derivative-based holding percentage in the Chapter 6C body is greater than nil.

(2) For the purposes of subsection (1):

(a) a person who disclosed under this Part that the person's derivative-based holding percentage in a Chapter 6C body was nilis taken to have disclosed that the person's:

(i) relatable derivative-based holding percentage; and

(ii) deemed physically settleable derivative-based holding percentage; and

(iii) deemed non-physically settleable derivative-based holding percentage; and

(iv) offsetting short position percentage;

in the Chapter 6C body were also nil; and

(b) a person who:

(i) was required to disclose a percentage under this Part; but

(ii) did not disclose that percentage by the time required;

is taken to have disclosed, in accordance with this Part, the percentage immediately after the situation giving rise to the requirement to disclose that percentage arose.

Pre-commencement disclosures

(3) For the purposes of subsection (1), if:

(a) before the commencement of this section, a person disclosed, or was required to disclose, under this Part the person's old holding percentage in a Chapter 6C body; and

(b) the person is not, on the commencement of this section, required to disclose under this Part the person's derivative-based holding percentage in the Chapter 6C body;

the person is taken to disclose the person's derivative-based holding percentage under this Part on that commencement.

(4) For the purposes of subsection (1) of this section, if:

(a) before the commencement of this section, a person disclosed, or was required to disclose, under this Part the person's old holding percentage in a Chapter 6C body; and

(b) the person is not, on the commencement of this section, required to disclose under this Part the person's relatable derivative-based holding percentage in the Chapter 6C body;

the person is taken to disclose the person's relatable derivative-based holding percentage under this Part on that commencement.

(5) For the purposes of subsection (1) of this section, if:

(a) before the commencement of this section, a person disclosed, or was required to disclose, under this Part the person's old holding percentage in a Chapter 6C body; and

(b) the person is not, on the commencement of this section, required to disclose under this Part the person's deemed physically settleable derivative-based holding percentage in the Chapter 6C body;

the person is taken to disclose the person's deemed physically settleable derivative-based holding percentage under this Part on that commencement.

(6) For the purposes of subsection (1) of this section, if:

(a) before the commencement of this section, a person disclosed, or was required to disclose, under this Part the person's old holding percentage in a Chapter 6C body; and

(b) the person is not, on the commencement of this section, required to disclose under this Part the person's deemed non-physically settleable derivative-based holding percentage in the Chapter 6C body;

the person is taken to disclose the person's deemed non-physically settleable derivative-based holding percentage under this Part on that commencement.

(7) For the purposes of subsection (1) of this section, if:

(a) before the commencement of this section, a person disclosed, or was required to disclose, under this Part the person's old holding percentage in a Chapter 6C body; and

(b) the person is not, on the commencement of this section, required to disclose under this Part the person's offsetting short position percentage in the Chapter 6C body;

the person is taken to disclose the person's offsetting short position percentage under this Part on that commencement.

(8) In this section:

old holding percentage means the percentage worked out using the formula in subsection 671B(2), as in force immediately before the commencement of this section.

671BL Percentages relating to relevant interests and deemed economic interests

(1) A person's percentage, in a Chapter 6C body, specified in column 1 of an item of the following table is the percentage worked out using the formula in subsection (2) if:

(a) the person, or an associate of the person, has a relevant interest or deemed economic interest in voting securities in the Chapter 6C body; and

(b) the relevant interest or deemed economic interest is of the kind specified in column 2 of the item.

Otherwise, the percentage is 0%.

Note: Section 671E expands the normal concept of relevant interest to take account of conditional agreements and escrow.

(2) For the purposes of subsection (1), the formula is:

where:

person's and associates' votes means the total number of votes attached to all the voting securities in the Chapter 6C body in which:

(a) the person; or

(b) an associate of the person;

has an interest of the kind specified in column 2 of the item of the table in subsection (1).

total votes means the total number of votes attached to all voting securities in the Chapter 6C body.

No double-counting

(3) Subsection (4) applies in relation to voting securities in the Chapter 6C body if:

(a) the item of the table in subsection (1) is item 3 or 4; and

(b) either:

(i) the person and one or more associates of the person; or

(ii) 2 or more associates of the person;

have an interest, of the kind specified in column 2 of the item, in the voting securities because of the same derivative.

(4) For the purposes of the definition of person's and associates' votes in subsection (2), treat the total number of votes attached to all of the voting securities to which this subsection applies as being equal to the total number of votes attached to the largest number of those voting securities in which one of the persons mentioned in subparagraph (3)(b)(i) or (ii) (whichever is applicable) has an interest of that kind because of the derivative.

Meaning of derivative-based holding percentage

(5) A person's derivative-based holding percentage in a Chapter 6C body is the total of:

(a) the person's relatable derivative-based holding percentage in the Chapter 6C body; and

(b) the person's deemed physically settleable derivative-based holding percentage in the Chapter 6C body; and

(c) the person's deemed non-physically settleable derivative-based holding percentage in the Chapter 6C body.

671BM Meaning of offsetting short position percentage

(1) A person's offsetting short position percentage in a Chapter 6C body is the percentage worked out using the formula in subsection (2) if the person has an offsetting short position in voting securities in the Chapter 6C body. Otherwise, the person's offsetting short position percentage in the Chapter 6C body is nil.

(2) For the purposes of subsection (1), the formula is:

where:

person's and associates' votes means the total number of votes attached to all the voting securities in the Chapter 6C body in which:

(a) the person; or

(b) an associate of the person;

has an offsetting short position.

total votes means the total number of votes attached to all voting securities in the Chapter 6C body.

No double-counting

(3) Subsection (4) applies in relation to voting securities in the Chapter 6C body if:

(a) the person and one or more associates of the person; or

(b) 2 or more associates of the person;

have an offsetting short position in the voting securities because of the same derivative.

(4) For the purposes of the definition of person's and associates' votes in subsection (2), treat the total number of votes attached to all of the voting securities to which this subsection applies as being equal to the total number of votes attached to the largest number of those voting securities in which one of the persons mentioned in paragraph (3)(a) or (b) (whichever is applicable) has an offsetting short position because of the derivative.

Division 4 - Other provisions

671C Civil liability

(1) A person who contravenes section 671B is liable to compensate another person for any loss or damage the other person suffers because of the contravention.

(2) It is a defence in proceedings brought under this section if the person who contravenes section 671B proves:

(a) that:

(i) the person contravened that section because of inadvertence or mistake; and

(ii) the inadvertence or mistake was reasonable in all the circumstances; or

(b) that the person contravened that section because the person was not aware of a relevant fact or occurrence (other than a fact or occurrence of which the person ought reasonably to have been aware).

In determining whether the defence is available, disregard the person's ignorance of, or a mistake on the person's part concerning, a matter of law.

(3) If 2 or more persons each contravene section 671B because of the same act or omission, their liability under this section for the contravention is joint and individual.

671D Substantial holdings and deemed economic interests

This Part applies in relation to a person who does not have a substantial holding in a Chapter 6C body as if the person did have such a substantial holding, if:

(a) the person, or an associate of the person, has a deemed economic interest in a number of voting securities of a particular class in the Chapter 6C body; and

(b) the person would have a substantial holding in the Chapter 6C body if the person or associate had a relevant interest in that number of voting securities of that class in the Chapter 6C body (in addition to any voting securities in which the person or associate actually has a relevant interest).

671E Relevant interests not excluded

For the purposes of this Part, a person has a relevant interest in securities if the person would have a relevant interest in the securities but for the enactment of the following:

(a) subsection 609(6) (market traded options and derivatives);

(b) subsection 609(7) (conditional agreements);

(c) subsection 609(9B) (securities escrowed under listing rules);

(d) section 609B (securities subject to escrow agreement in connection with initial public offer etc.).

671F Listed foreign bodies to which equivalent foreign requirements apply

(1) This section applies if:

(a) apart from subsection (2), this Part would require (the Australian requirement ) a person (the discloser ) to give or disclose to another person information in relation to a particular matter relating to a listed body to which item 5 of the table in section 671A applies; and

(b) requirements (the foreign requirements ) that are declared under subsection (4) of this section apply in relation to the listed body; and

(c) under the foreign requirements, information in relation to that matter must be given to a person.

(2) The Australian requirement does not apply if the requirement to give information referred to in paragraph (1)(c) is complied with.

(3) If, because of subsection (2), the Australian requirement does not apply, the listed body must, as soon as practicable after information is given in relation to the matter as mentioned in paragraph (1)(c), give the information to the operator of each declared financial market:

(a) that is operated in this jurisdiction; and

(b) the official list of which includes the listed body.

(4) For the purposes of paragraph (1)(b), ASIC may, by legislative instrument, declare requirements if:

(a) the requirements are requirements of:

(i) a law of a jurisdiction other than this one; or

(ii) a financial market that is operated in a jurisdiction other than this one; and

(b) ASIC is satisfied that the requirements are equivalent to the requirements of this Part.

Fault-based offence

(5) A person commits an offence if the person contravenes subsection (3).

Strict liability offence

(6) A person commits an offence of strict liability if the person contravenes subsection (3).

22   Subsection 1317QC(4)

Repeal the subsection.

23   Subsection 1317QD(1)

Omit "(1)".

24   Subsection 1317QD(2)

Repeal the subsection.

25   Schedule 3 (table item dealing with subsection 671B(8), column headed "Provision")

Omit "Subsection 671B(8)", substitute "Subsection 671B(4)".

26   Schedule 3 (table item dealing with subsection 671B(9), column headed "Provision")

Omit "Subsection 671B(9)", substitute "Subsection 671B(5)".

27   Schedule 3 (after table item dealing with subsection 671B(9))

Insert:

Division 3   Tracing beneficial ownership

Corporations Act 2001

28   Section 9

Insert:

instructions :

(a) about derivatives relating to a Chapter 6C body - means instructions about:

(i) the acquisition or disposal of derivatives, being derivatives that result in a person having a deemed economic interest in a number of voting securities in the Chapter 6C body; or

(ii) the exercise of any rights attached to such derivatives; or

(iii) any other matter relating to such derivatives; or

(b) about voting securities in a Chapter 6C body - means instructions about:

(i) the acquisition or disposal of voting securities in the Chapter 6C body; or

(ii) the exercise of any voting or other rights attached to voting securities in the Chapter 6C body; or

(iii) any other matter relating to voting securities in the Chapter 6C body.

29   Subsection 169(6)

Omit "672B", substitute "672BA".

30   Before section 672A

Insert:

Division 1 - Directions by ASIC

Subdivision A - Disclosure notices

31   Section 672A

Repeal the section, substitute:

672A Disclosure notices

ASIC may direct:

(a) a member of a Chapter 6C body; or

(b) a person named in a previous disclosure under section 672AB as:

(i) having a relevant interest in voting securities in a Chapter 6C body; or

(ii) having given instructions about voting securities in a Chapter 6C body; or

(c) a person whom ASIC suspects, on reasonable grounds:

(i) has a relevant interest in voting securities in a Chapter 6C body; or

(ii) has given instructions about voting securities in a Chapter 6C body; or

(iii) is an associate of a person to whom subparagraph (i) or (ii) applies in relation to voting securities in the Chapter 6C body; or

(d) a person named in a previous disclosure under section 672AB as:

(i) having a deemed economic interest in a number of voting securities of a particular class in a Chapter 6C body; or

(ii) having given instructions about derivatives relating to a Chapter 6C body; or

(e) a person whom ASIC suspects, on reasonable grounds:

(i) has a deemed economic interest in a number of voting securities of a particular class in a Chapter 6C body; or

(ii) has given instructions about derivatives relating to a Chapter 6C body; or

(iii) is an associate of a person to whom subparagraph (i) or (ii) applies in relation to voting securities of a particular class in the Chapter 6C body;

to make the disclosure required by section 672AB in relation to the Chapter 6C body.

672AA Service of disclosure notices

(1) Without limiting section 672A, ASIC may give a direction under that section by:

(a) sending the direction by:

(i) pre-paid post; or

(ii) pre-paid courier service;

to an address that it is reasonable for ASIC to send the direction to; or

(b) emailing the direction to an email address that it is reasonable for ASIC to email the direction to.

(2) If:

(a) ASIC gives a direction to a person in the way described in paragraph (1)(a) of this section; and

(b) the direction specifies a way for the person to notify ASIC that the person has received the direction; and

(c) ASIC does not, during the 21 days starting on the day ASIC posts the direction or gives it to the courier, receive a notification from the person, in that specified way, that the person has received the direction;

the person is taken to receive the direction on the last of those 21 days, unless it is proved that the person received the direction earlier.

(3) If:

(a) ASIC emails a direction to a person in the way described in paragraph (1)(b); and

(b) the direction specifies a way for the person to notify ASIC that the person has received the direction; and

(c) ASIC does not, during the 7 days starting when ASIC emails the direction, receive a notification from the person, in that specified way, that the person has received the direction;

the person is taken to receive the direction on the last of those 7 days, unless it is proved that the person received the direction earlier.

672AB Compliance with direction

(1) This section applies if a person (the discloser ) is directed under section 672A to make the disclosure required by this section in relation to a Chapter 6C body.

(2) The discloser must, in accordance with sections 672AC and 672AF, disclose to ASIC the information required by section 672AD.

Note: Failure to comply with this subsection is an offence: see subsection 1311(1).

(3) An offence based on subsection (2) of this section is an offence of strict liability.

672AC Deadline for disclosure

For the purposes of subsection 672AB(2), a person (the discloser ) who is directed under section 672A to make a disclosure in relation to a Chapter 6C body must make the disclosure within 2 business days after:

(a) the discloser is given the direction; or

(b) if:

(i) the discloser applies for an exemption under section 673 from the obligation to make the disclosure; and

(ii) ASIC refuses to grant the exemption;

ASIC notifies the discloser of its decision on the application.

32   After section 672A

Insert:

Subdivision B - Information required to be disclosed

672AD Information required to be disclosed

(1) Subject to section 672AE, for the purposes of subsection 672AB(2), a person (the discloser ) who is directed under section 672A to make a disclosure in relation to a Chapter 6C body must disclose:

(a) full details of the discloser's own relevant interests and deemed economic interests in voting securities in the Chapter 6C body, including full details of:

(i) the circumstances that give rise to the relevant interests and deemed economic interests; and

(ii) if the discloser has a relevant interest under subsection 608(8) in voting securities in the Chapter 6C body, or deemed economic interests in voting securities in the Chapter 6C body - any offsetting short positions of the discloser in voting securities in the Chapter 6C body; and

(b) full details of any agreement through which the discloser would have a relevant interest, deemed economic interest or offsetting short position in voting securities in the Chapter 6C body; and

(c) the name of each associate of the discloser, together with full details of the nature of the discloser's association with the associate; and

(d) the name and address of any other person who has a deemed economic interest in voting securities in the Chapter 6C body, together with full details of:

(i) the nature and extent of the other person's deemed economic interest; and

(ii) the circumstances that give rise to the other person's deemed economic interest; and

(e) the name and address of each person who has given the discloser instructions about derivatives relating to the Chapter 6C body, together with full details of those instructions (including the date or dates on which they were given); and

(f) any other particulars:

(i) prescribed by the regulations for the purposes of this subparagraph in relation to the direction; or

(ii) determined under subsection (2) in relation to the direction.

(2) For the purposes of subparagraph (1)(f)(ii) of this section, ASIC may, by legislative instrument, determine particulars in relation to the direction if the particulars are determined under subsection 671BB(3) in relation to the Chapter 6C body.

Additional information about specified securities

(3) Subsection (5) applies if:

(a) paragraph 672A(a), (b) or (c) applies to the discloser; and

(b) the direction specifies disclosable securities in the Chapter 6C body for the purposes of this paragraph.

(4) For the purposes of paragraph (3)(b), the direction may specify disclosable securities in the Chapter 6C body. The specified disclosable securities must be:

(a) if paragraph 672A(a) applies to the discloser - disclosable securities the discloser is shown as holding in the Chapter 6C body's register of members; or

(b) if paragraph 672A(b) applies to the discloser - voting securities the discloser was named as:

(i) having a relevant interest in; or

(ii) as having given instructions about;

as mentioned in that paragraph; or

(c) if paragraph 672A(c) applies to the discloser - voting securities that are relevant to the suspicion mentioned in that paragraph.

Note: More than one paragraph of section 672A may apply to the discloser. For example, the discloser may have been named in a previous disclosure as having both a relevant interest in securities and a deemed economic interest in securities and also be suspected of having a relevant interest in other securities, in which case the direction may specify securities to which paragraph (b) or (c) of this subsection applies.

(5) In addition to the matters in subsection (1), the discloser must disclose:

(a) the name and address of any other person who has a relevant interest in any of the specified disclosable securities, together with full details of:

(i) the nature and extent of the other person's relevant interest; and

(ii) the circumstances that give rise to the other person's relevant interest; and

(b) if the specified disclosable securities are voting securities - the name and address of each person who has given the discloser instructions about any of the specified disclosable securities in the Chapter 6C body, together with full details of those instructions (including the date or dates on which they were given).

672AE Information required to be disclosed - limitations

Despite section 672AD, if a person (the discloser ) is directed under section 672A to make a disclosure in relation to a Chapter 6C body:

(a) if the direction specifies that the discloser is directed to disclose specified information only (being information covered by subsection 672AD(1) or (5)) - the discloser is required to disclose only the specified information; and

(b) a matter referred to in paragraph 672AD(1)(d) need only be disclosed to the extent to which it is known to the discloser on the basis of information that is not publicly available (whether or not it is also knowable on the basis of information that is publicly available); and

(c) a matter referred to in paragraph 672AD(5)(a) need only be disclosed to the extent to which it is known to the discloser.

Note: A defendant bears an evidential burden in relation to the matter in paragraph (b) or (c) of this section: see subsection 13.3(3) of the Criminal Code.

Subdivision C - Accompanying documents and statements

672AF Accompanying documents and statements

(1) For the purposes of subsection 672AB(2), and subject to subsections (3) to (5) of this section, a disclosure that a person (the discloser ) is directed to make under section 672A in relation to a Chapter 6C body must be accompanied by:

(a) for each agreement (if any):

(i) that contributed to the circumstances giving rise to a relevant interest or deemed economic interest mentioned in paragraph 672AD(1)(a) or (d) or (5)(a); and

(ii) for which there is one or more documents that set out the terms of the agreement, are in writing and are readily available to the discloser;

a copy of each document to which subparagraph (ii) of this paragraph applies, endorsed in accordance with subsection (2); and

(b) for each contract, scheme or arrangement (if any):

(i) that contributed to the circumstances giving rise to a relevant interest or deemed economic interest mentioned in paragraph 672AD(1)(a) or (d) or (5)(a); and

(ii) is not both in writing and readily available to the discloser; and

(iii) is not an agreement to which paragraph (a) of this subsection applies;

a statement by the discloser giving full details of the contract, scheme or arrangement.

(2) For the purposes of paragraph (1)(a) of this section, each copy must be endorsed with a statement that the copy is a true copy.

Exceptions

(3) Subsections (1) and (2) do not apply to the extent (if any) specified in the direction.

(4) Subjection (5) applies in relation to a contract, scheme or arrangement that:

(a) contributed to the circumstances giving rise to:

(i) a deemed economic interest mentioned in paragraph 672AD(1)(d); or

(ii) a relevant interest mentioned in paragraph 672AD(5)(a); and

(b) did not contribute to circumstances giving rise to a relevant interest or deemed economic interest mentioned in paragraph 672AD(1)(a).

(5) Details of the contract, scheme or arrangement need only be included in a statement under paragraph (1)(b) of this section to the extent to which:

(a) if subparagraph (4)(a)(ii) applies - the details are known to the discloser; or

(b) otherwise - the details are known to the discloser on the basis of information that is not publicly available (whether or not they are also knowable on the basis of information that is publicly available).

33   Before section 672B

Insert:

Division 2 - Directions by key persons or at request of members

Subdivision A - Disclosure notices

34   Section 672B

Repeal the section, substitute:

672B Disclosure notices

(1) A person mentioned in subsection (2) may direct a person mentioned in subsection (3) to make the disclosure required by section 672BA in relation to a Chapter 6C body.

(2) The direction may be given by:

(a) the key person for the Chapter 6C body; or

(b) ASIC, if:

(i) a member of the Chapter 6C body requests ASIC to give the direction; and

(ii) ASIC does not consider that it would be unreasonable to give the direction.

(3) The direction may be given to:

(a) a member of the Chapter 6C body; or

(b) a person named in a previous disclosure under section 672BA, or in information given to the key person for the Chapter 6C body under section 672C, as:

(i) having a relevant interest in voting securities in the Chapter 6C body; or

(ii) having given instructions about voting securities in the Chapter 6C body; or

(c) a person whom:

(i) if paragraph (2)(a) of this section applies - the key person for the Chapter 6C body; or

(ii) if paragraph (2)(b) applies - the member who makes the request mentioned in subparagraph (2)(b)(i);

suspects, on reasonable grounds:

(iii) has a relevant interest in voting securities in the Chapter 6C body; or

(iv) has given instructions about voting securities in the Chapter 6C body.

(4) For the purposes of paragraph (3)(c) of this section, the suspicion must be formed wholly or partly on the basis of information given under this Chapter.

672BA Compliance with direction

(1) This section applies if a person (the discloser ) is directed under subsection 672B(1) to make the disclosure required by this section in relation to a Chapter 6C body.

(2) The discloser must, in accordance with section 672BB, disclose to the person who gives the direction the information required by section 672BC.

Note: Failure to comply with this subsection is an offence: see subsection 1311(1).

(3) An offence based on subsection (2) of this section is an offence of strict liability.

(4) The discloser does not have to comply with the direction if:

(a) paragraph 672B(2)(a) applies (the direction is given by the key person for the Chapter 6C body); and

(b) the discloser proves that the giving of the direction is vexatious.

Note: A defendant bears a legal burden in relation to the matter in this subsection: see section 13.4 of the Criminal Code.

672BB Deadline for disclosure

For the purposes of subsection 672BA(2), a person (the discloser ) who is directed under subsection 672B(1) to make a disclosure in relation to a Chapter 6C body must make the disclosure within 2 business days after:

(a) the discloser is given the direction; or

(b) if:

(i) the discloser applies for an exemption under section 673 from the obligation to make the disclosure; and

(ii) ASIC refuses to grant the exemption;

ASIC notifies the discloser of its decision on the application; or

(c) if paragraph 672B(2)(a) applies (the direction is given by the key person for the Chapter 6C body) - the key person for the Chapter 6C body pays any fee payable under the regulations made for the purposes of subsection 672D(2).

35   After section 672B

Insert:

Subdivision B - Information required to be disclosed

672BC Information required to be disclosed

(1) Subject to section 672BD, for the purposes of subsection 672BA(2), a person (the discloser ) who is directed under subsection 672B(1) to make a disclosure in relation to a Chapter 6C body must disclose:

(a) full details of the discloser's own relevant interests in voting securities in the Chapter 6C body, including full details of the circumstances that give rise to the relevant interests; and

(b) if the direction specifies disclosable securities in the Chapter 6C body for the purposes of this paragraph (see subsection (2) of this section) - the name and address of any other person who has a relevant interest in any of the specified disclosable securities, together with full details of:

(i) the nature and extent of the other person's relevant interest; and

(ii) the circumstances that give rise to the other person's relevant interest; and

(c) if the direction specifies disclosable securities in the Chapter 6C body for the purposes of this paragraph (see subsection (2) of this section) - the name and address of each person who has given the discloser instructions about any of the specified disclosable securities in the Chapter 6C body, together with full details of those instructions (including the date or dates on which they were given); and

(d) any other particulars prescribed by the regulations for the purposes of this paragraph in relation to the direction.

(2) For the purposes of paragraph (1)(b) or (c), the direction may specify disclosable securities in the Chapter 6C body. The specified disclosable securities must be:

(a) if paragraph 672B(3)(a) applies to the discloser - disclosable securities the discloser is shown as holding in the Chapter 6C body's register of members; or

(b) if paragraph 672B(3)(b) applies to the discloser - voting securities the discloser was named as:

(i) having a relevant interest in; or