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Bill
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Corporations Bill 2001
- Part 1.1—Preliminary
- Part 1.1A—Interaction between Corporations legislation and State and Territory laws
- Part 1.2—Interpretation
- Part 1.2A—Disclosing entities
- Part 1.4—Technical provisions about aids for readers
- Part 1.5—Small business guide
- Part 2A.1—What companies can be registered
- Part 2A.2—How a company is registered
- Part 2B.1—Company powers and how they are exercised
- Part 2B.2—Assumptions people dealing with companies are entitled to make
- Part 2B.3—Contracts before registration
- Part 2B.4—Replaceable rules and constitution
- Part 2B.5—Registered office and places of business
- Part 2B.6—Names
- Part 2B.7—Changing company type
- Part 2D.1—Duties and powers
- Part 2D.2—Restrictions on indemnities, insurance and termination payments
- Part 2D.3—Appointment, remuneration and cessation of appointment of directors
- Part 2D.4—Appointment of secretaries
- Part 2D.5—Public information about directors and secretaries
- Part 2D.6—Disqualification from managing corporations
- Part 2E.1—Member approval needed for related party benefit
- Part 2E.2—Related parties and financial benefits
- Part 2E.3—Interaction with other rules
- Part 2F.1—Oppressive conduct of affairs
- Part 2F.1A—Proceedings on behalf of a company by members and others
- Part 2F.2—Class rights
- Part 2F.3—Inspection of books
- Part 2G.1—Directors’ meetings
- Part 2G.2—Meetings of members of companies
- Part 2G.3—Minutes and members’ access to minutes
- Part 2G.4—Meetings of members of registered managed investment schemes
- Part 2H.1—Issuing and converting shares
- Part 2H.2—Redemption of redeemable preference shares
- Part 2H.3—Partly-paid shares
- Part 2H.4—Capitalisation of profits
- Part 2H.5—Dividends
- Part 2H.6—Notice requirements
- Part 2J.1—Share capital reductions and share buy-backs
- Part 2J.2—Self-acquisition and control of shares
- Part 2J.3—Financial assistance
- Part 2J.4—Interaction with general directors’ duties
- Part 2K.1—Preliminary
- Part 2K.2—Registration
- Part 2K.3—Order of priority
- Part 2L.1—Requirement for trust deed and trustee
- Part 2L.2—Duties of borrower
- Part 2L.3—Duties of guarantor
- Part 2L.4—Trustee
- Part 2L.5—Meetings of debenture holders
- Part 2L.6—Civil liability
- Part 2L.7—ASIC powers
- Part 2L.8—Court
- Part 2L.9—Location of other debenture provisions
- Part 2M.1—Overview
- Part 2M.2—Financial records
- Part 2M.3—Financial reporting
- Part 2M.4—Appointment and removal of auditors
- Part 2M.5—Accounting standards
- Part 2M.6—Exemptions and modifications
- Part 2M.7—Sanctions for contraventions of Chapter
- Part 2N.1—Annual returns
- Part 2N.2—Lodgments with ASIC
- Part 5.1—Arrangements and reconstructions
- Part 5.2—Receivers, and other controllers, of property of corporations
- Part 5.3A—Administration of a company’s affairs with a view to executing a deed of company arrangement
- Part 5.4—Winding up in insolvency
- Part 5.4A—Winding up by the Court on other grounds
- Part 5.4B—Winding up in insolvency or by the Court
- Part 5.5—Voluntary winding up
- Part 5.6—Winding up generally
- Part 5.7—Winding up bodies other than companies
- Part 5.7B—Recovering property or compensation for the benefit of creditors of insolvent company
- Part 5.8—Offences
- Part 5.8A—Employee entitlements
- Part 5.9—Miscellaneous
- Part 5A.1—Deregistration
- Part 5A.2—Transfer of registration
- Part 5B.1—Registering a body corporate as a company
- Part 5B.2—Registrable bodies
- Part 5B.3—Names of registrable Australian bodies and foreign companies
- Part 5C.1—Registration of managed investment schemes
- Part 5C.2—The responsible entity
- Part 5C.3—The constitution
- Part 5C.4—The compliance plan
- Part 5C.5—The compliance committee
- Part 5C.6—Members’ rights to withdraw from a scheme
- Part 5C.7—Related party transactions
- Part 5C.8—Effect of contraventions (civil liability and voidable contracts)
- Part 5C.9—Winding up
- Part 5C.10—Deregistration
- Part 5C.11—Exemptions and modifications
- Part 6.1—Prohibited acquisitions of relevant interests in voting shares
- Part 6.2—Exceptions to the prohibition
- Part 6.3—The different types of takeover bid
- Part 6.4—Formulating the takeover offer
- Part 6.5—The takeover procedure
- Part 6.6—Variation of offers
- Part 6.7—Withdrawal and suspension of offers
- Part 6.8—Acceptances
- Part 6.9—Other activities during the bid period
- Part 6.10—Review and intervention
- Part 6A.1—Compulsory acquisitions and buy-outs following takeover bid
- Part 6A.2—General compulsory acquisitions and buy-outs
- Part 6A.3—Completion of compulsory acquisition of securities
- Part 6A.4—Experts’ reports and valuations
- Part 6A.5—Records of unclaimed consideration
- Part 6A.6—ASIC powers
- Part 6C.1—Substantial holding information
- Part 6C.2—Tracing beneficial ownership of shares
- Part 6C.3—ASIC powers
- Part 6D.1—Application of the fundraising provisions
- Part 6D.2—Disclosure to investors about securities
- Part 6D.3—Prohibitions, liabilities and remedies
- Part 6D.4—ASIC’s powers
- Part 7.1—Interpretation
- Part 7.1A—The Australian Stock Exchange Limited
- Part 7.2—Securities exchanges and stock markets
- Part 7.2A—The Securities Clearing House
- Part 7.3—Participants in the securities industry
- Part 7.4—Conduct of securities business
- Part 7.5—Dealers’ financial statements and audit
- Part 7.6—Money and scrip of dealers’ clients
- Part 7.7—Registers of interests in securities
- Part 7.8—Deposits with stock exchanges
- Part 7.9—Fidelity funds
- Part 7.10—The National Guarantee Fund
- Part 7.11—Conduct in relation to securities
- Part 7.13—Title to, and transfer of, securities
- Part 7.14—Miscellaneous
- Part 8.1—Interpretation
- Part 8.2—Futures exchanges, clearing houses and futures associations
- Part 8.3—Participants in the futures industry
- Part 8.4—Conduct of futures business
- Part 8.5—Financial statements and audit
- Part 8.6—Fidelity funds
- Part 8.7—Offences
- Part 8.8—Miscellaneous
- Part 9.1—Registers and registration of documents
- Part 9.2—Registration of auditors and liquidators
- Part 9.3—Books
- Part 9.4—Offences
- Part 9.4A—Review by Administrative Appeals Tribunal of certain decisions
- Part 9.4B—Civil consequences of contravening civil penalty provisions
- Part 9.5—Powers of Courts
- Part 9.6—Proceedings
- Part 9.6A—Jurisdiction and procedure of Courts
- Part 9.7—Unclaimed property
- Part 9.9—Miscellaneous
- Part 9.10—Fees for chargeable matters
- Part 9.12—Regulations
- Part 10.1—Transition from the old corporations legislation
- Part 1—Preliminary
- Part 2—Financial institutions that became companies
- Part 4—The transition period
- Part 5—Demutualisations
- Part 6—Continued application of fundraising provisions of the Friendly Societies Code
- Part 7—Transitional provisions
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Corporations Bill 2001
Part 2H.3 — Partly-paid shares
254M Liability on partly-paid shares
General rule about shareholder’s liability for calls
(1) If shares in a company are partly-paid, the shareholder is liable to pay calls on the shares in accordance with the terms on which the shares are on issue. This subsection does not apply to a no liability company.
Note: The shareholder may also be liable as a contributory under sections 514-529 if the company is wound up.
No liability companies
(2) The acceptance by a person of a share in a no liability company, whether by issue or transfer, does not constitute a contract by the person to pay:
(a) calls in respect of the share; or
(b) any contribution to the debts and liabilities of the company.
254N Calls may be limited to when company is externally-administered
(1) A limited company may provide by special resolution that the whole or a part of its unpaid share capital may be called up only if the company becomes an externally-administered body corporate.
(2) The company must lodge with ASIC a copy of the special resolution within 14 days after it is passed.
254P No liability companies—calls on shares
Making calls
(1) A call on a share in a no liability company is not effective unless it is made payable at least 14 days after the call is made.
Notice of call
(2) At least 7 days before a call on shares in a no liability company becomes payable, the company must give the holders of the shares notice of:
(a) the amount of the call; and
(b) the day when it is payable; and
(c) the place for payment.
The notice must be sent by post. If the notice is not given, the call is not payable.
(3) A call does not have any effect on a forfeited share that is held by or in trust for the company under subsection 254Q(6). However, when the share is re-issued or sold by the company, the share may be credited as paid up to the amount determined by the company in accordance with its constitution or by resolution.
254Q No liability companies—forfeiture and sale of shares for failure to meet call
Forfeiture and sale of shares
(1) A share in a no liability company is immediately forfeited if:
(a) a call is made on the share; and
(b) the call is unpaid at the end of 14 days after it became payable.
Note: The holder of the share may redeem it under section 254R.
(2) The forfeited share must then be offered for sale by public auction within 6 weeks after the call became payable.
Advertisement of sale
(3) At least 14 days, and not more than 21 days, before the day of the sale, the sale must be advertised in a daily newspaper circulating generally throughout Australia. The specific number of shares to be offered need not be specified in the advertisement and it is sufficient to give notice of the sale by advertising to the effect that all shares on which a call remains unpaid will be sold.
Postponement of sale
(4) An intended sale of forfeited shares that has been duly advertised may be postponed for not more than 21 days from the advertised date of sale. The date to which the sale is postponed must be advertised in a daily newspaper circulating generally in Australia.
(5) There may be more than 1 postponement but the sale cannot be postponed to a date more than 90 days from the first date fixed for the intended sale.
Shares may be offered as credited to a particular amount
(6) The share may be sold credited as paid up to the sum of:
(a) the amount paid upon the share at the time of forfeiture; and
(b) the amount of the call; and
(c) the amount of any other calls becoming payable on or before the day of the sale;
if the company in accordance with its constitution or by ordinary resolution so determines.
Reserve price
(7) The directors may fix a reserve price for the share that does not exceed the sum of:
(a) the amount of the call due and unpaid on the share at the time of forfeiture; and
(b) the amount of any other calls that become payable on or before the date of the sale.
Withdrawal from sale
(8) The share may be withdrawn from sale if no bid at least equal to the reserve price is made at the sale.
Disposal of shares withdrawn from sale
(9) If:
(a) no bid for the share is received at the sale; or
(b) the share is withdrawn from sale;
the share must be held by the directors in trust for the company. It must be then disposed of in the manner determined by the company in accordance with its constitution or by resolution. Unless otherwise specifically provided by resolution, the share must first be offered to shareholders for a period of 14 days before being disposed of in any other manner.
Suspension of voting rights attached to share held in trust
(10) At any meeting of the company, no person is entitled to any vote in respect of the shares held by the directors in trust under subsection (9).
Application of proceeds of sale
(11) The proceeds of the sale under subsection (2) or the disposal under subsection (9) must be applied to pay:
(a) first, the expenses of the sale; and
(b) then, any expenses necessarily incurred in respect of the forfeiture; and
(c) then, the calls on the share that are due and unpaid.
The balance (if any) must be paid to the member whose share has been sold. If there is a share certificate that relates to the share, the balance does not have to be paid until the member delivers the certificate to the company.
Validity of sale
(12) If a sale is not held in time because of error or inadvertence, a late sale is not invalid if it is held as soon as practicable after the discovery of the error or inadvertence.
Failure to comply an offence
(13) If there is failure to comply with subsection (2) or (3), the company and any officer of the company who is involved in the contravention are each guilty of an offence.
254R No liability companies—redemption of forfeited shares
(1) Despite section 254Q, if a person’s share has been forfeited, the person may redeem the share, at any time up to or on the last business day before the proposed sale, by paying the company:
(a) all calls due on the share; and
(b) if the company so requires:
(i) a portion, calculated on a pro rata basis, of all expenses incurred by the company in respect of the forfeiture; and
(ii) a portion, calculated on a pro rata basis, of all costs and expenses of any proceeding that has been taken in respect of the forfeiture.
On payment, the person is entitled to the share as if the forfeiture had not occurred.
(2) On the last business day before the proposed sale, the registered office of the company must be open during the hours for which it is by this Act required to be open and accessible to the public.