Senate

Supplementary Explanatory Memorandum

(Circulated by the authority of the Minister for Revenue and Financial Services, the Hon Kelly O'Dwyer MP)

General outline and financial impact

Amendment to the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Bill 2017

This amendment to the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Bill 2017:

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strengthens the anti-avoidance mechanism to ensure that parties cannot contract out of the stay on the enforcement of rights under applicable ipso facto clauses;

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extends the right to consent in writing to the enforcement of rights under an applicable ipso facto clause so that it is also available to a liquidator who is appointed to a company subsequent to a compromise / arrangement or an administration; and

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clarifies that the stay applies to self-executing ipso facto clauses.

Date of effect: This amendment will apply at the same time as Part 2 of Schedule 1 of the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Bill 2017.

Proposal announced: These amendments have not previously been announced.

Financial impact: Nil. The amendments do not alter the financial impact as outlined in the explanatory memorandum to the Bill.

Human rights implications: None. The amendments do not raise any human rights issues.

Compliance cost impact: Nil. The amendments do not alter the compliance cost impact as outlined in the explanatory memorandum to the Bill.