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Part 2—Commonwealth investment in the Australian Business Growth Fund

Part 2 Commonwealth investment in the Australian Business Growth Fund

   

9   Simplified outline of this Part

The Commonwealth may invest in a Corporations Act company that is the Australian Business Growth Fund for the purpose of providing small and medium Australian enterprises with access to capital (within constitutional limits).

The Commonwealth may make arrangements relating to the operations of the Fund, but must not control the Fund.

10   Commonwealth investment in the Australian Business Growth Fund

             (1)  The Minister may, on behalf of the Commonwealth, do either or both of the following:

                     (a)  participate in forming a Corporations Act company;

                     (b)  acquire shares (either by purchase or subscription) in a Corporations Act company, or become a member of a Corporations Act company;

in circumstances that would not result in the company becoming a Commonwealth company.

             (2)  The Minister may, on behalf of the Commonwealth, acquire debentures (either by purchase or subscription) of a Corporations Act company.

             (3)  However, the Minister may not exercise the powers conferred by this section in relation to more than one Corporations Act company.

             (4)  For the purposes of this Act, if the Minister exercises a power conferred by this section in relation to a company, that company is the Australian Business Growth Fund (whether or not the company’s name includes the words “Australian Business Growth Fund”).

11   Arrangements relating to the operations of the Fund

             (1)  The Minister may, on behalf of the Commonwealth, make arrangements, relating to the operations of the Fund, with any of the following:

                     (a)  the Fund, or a Corporations Act company that is proposed to become the Fund;

                     (b)  a member of the Fund, or a proposed member of the Fund;

                     (c)  a subsidiary of the Fund;

in circumstances that would not result in the Fund becoming a Commonwealth company.

             (2)  An arrangement made under subsection (1) may provide for the Commonwealth to make payments.

12   Minister has powers etc. of the Commonwealth

                   The Minister, on behalf of the Commonwealth, has all the rights, responsibilities, duties and powers of the Commonwealth in relation to the Commonwealth’s capacity as:

                     (a)  a member of the Fund; or

                     (b)  a shareholder in the Fund; or

                     (c)  a holder of debentures of the Fund; or

                     (d)  a party to an arrangement made under section 11.

13   Constitutional limits

             (1)  The Minister may exercise a power conferred on the Minister by section 10, 11 or 12 only if arrangements of the kind referred to in subsection (2) of this section have been made, or will be made before the Fund makes any investment.

             (2)  The arrangements are arrangements requiring the Fund to apply money received from the Commonwealth only:

                     (a)  with respect to trade or commerce:

                              (i)  between Australia and places outside Australia; or

                             (ii)  among the States; or

                            (iii)  within a Territory, between a State and a Territory or between 2 Territories; or

                     (b)  with respect to a Territory.

Example:    Arrangements could allow the Fund to apply money received from the Commonwealth, for the purpose of generating a commercial return for the Fund, in a small or medium Australian enterprise that is engaged predominantly in trade or commerce between Australia and places outside Australia.

             (3)  To avoid doubt, the Minister may exercise a power conferred by section 10 or 11 for the purpose of making arrangements of the kind referred to in subsection (2) of this section.

             (4)  If:

                     (a)  the Commonwealth holds shares in or debentures of, or is a member of, the Fund; and

                     (b)  either of the following applies:

                              (i)  arrangements of the kind referred to in subsection (2) are unlikely to be made before the Fund makes any investment;

                             (ii)  arrangements of the kind referred to in subsection (2) are no longer in force;

the Minister must, as soon as practicable, take such steps as are necessary to divest the Commonwealth of its investment in the Fund.

             (5)  Subsection (1) applies in relation to a right, responsibility or duty conferred on the Minister by section 12 in the same way that subsection applies in relation to a power conferred on the Minister by that section.

14   Fund not to become a Commonwealth company

                   The Minister must ensure that the Fund does not become a Commonwealth company.

15   Executive power

                   This Part does not, by implication, limit the executive power of the Commonwealth.

16   Rules about the exercise of powers etc. under this Act

                   The rules may make provision for, or in relation to, the exercise of rights, responsibilities, duties and powers by the Minister under this Act.