Telstra (Dilution of Public Ownership) Act 1996
No. 81, 1996
An Act relating to the dilution of the public ownership of Telstra, and for other purposes
Telstra (Dilution of Public Ownership) Act 1996
No. 81, 1996
An Act relating to the dilution of the public ownership of Telstra, and for other purposes
Contents
1 Short title..................................1
2 Commencement..............................1
3 Schedule(s).................................2
Schedule 1—Amendments 3
Telecommunications Act 1991 3
Telstra Corporation Act 1991 11
Telstra (Dilution of Public Ownership) Act 1996
No. 81, 1996
An Act relating to the dilution of the public ownership of Telstra, and for other purposes
[Assented to 19 December 1996]
The Parliament of Australia enacts:
This Act may be cited as the Telstra (Dilution of Public Ownership) Act 1996.
(1) Subject to this section, this Act commences on the day on which it receives the Royal Assent.
(2) The amendments of the Telstra Corporation Act 1991 made by this Act commence on 1 May 1997.
Subject to section 2, each Act that is specified in a Schedule to this Act is amended as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.
1 Subsection 38(2)
After “persons in” (first occurring), insert “connection with”.
2 Paragraph 38(2)(b)
Omit “the quality of”.
3 At the beginning of subparagraphs 38(2)(b)(i), (ii) and (iii)
Insert “the quality of”.
4 At the end of paragraph 38(2)(b)
Add:
(iv) matters associated with, or incidental to, the supply of goods or services referred to in subparagraph (i), (ii) or (iii); and
5 At the end of section 38
Add:
(4) The matters referred to in subparagraph (2)(b)(iv) include (but are not limited to):
(a) the timeliness and comprehensibility of bills; and
(b) the procedures to be followed by carriers to generate standard billing reports in order to assist in the investigation of consumer complaints about bills; and
(c) any other matter relating to customer billing.
6 Before paragraph 50(3)(a)
Insert:
(aa) that he or she is empowered to give under section 87P; or
7 At the end of section 55
Add:
; and (e) providing for a customer service guarantee that requires carriers to comply with certain performance standards.
8 At the end of subsection 61(1)
Add “(other than section 87P)”.
9 Subsection 73(2)
Omit “an eligible customer”, substitute “a customer”.
10 Subsection 73(3) (definition of eligible customer)
Repeal the definition.
11 After section 87C
Insert:
Division 6—Customer service guarantee
(1) In this Division:
customer includes prospective customer.
damages includes punitive damages.
service provider means a person, other than a carrier, who supplies an eligible service.
Note: For eligible service see section 18 of the Telecommunications Act.
(2) In determining the meaning that an expression has when used in a provision of this Act other than this Division, subsection (1) is to be disregarded.
(1) AUSTEL may, by written instrument, make standards to be complied with by carriers and service providers in relation to:
(a) the making of arrangements with customers about the period taken to comply with requests to connect customers to specified kinds of telecommunications services; and
(b) the periods that carriers or service providers may offer to customers when making those arrangements; and
(c) the compliance by carriers and service providers with the terms of those arrangements; and
(d) the period taken to comply with requests to rectify faults or service difficulties relating to specified kinds of telecommunications services, where the rectification follows the making of a customer report about a fault or service difficulty; and
(e) the keeping of appointments to meet customers, or representatives of customers, where the appointment relates to:
(i) a connection of a kind covered by paragraph (a); or
(ii) a rectification of a kind covered by paragraph (d); and
(f) any other matter in relation to which AUSTEL thinks it appropriate to develop standards.
(2) A standard under this section that relates to a particular kind of telecommunications service does not apply to a particular carrier or service provider in connection with the supply of that kind of service at a particular location unless the carrier or service provider:
(a) supplies that kind of service at that location; or
(b) offers to supply that kind of service at that location.
(3) AUSTEL must not make a standard under this section unless it is directed to do so by the Minister under section 87P.
(4) A standard under this section may be of general application or may be limited as provided in the standard. This subsection does not, by implication, limit subsection 33(3A) of the Acts Interpretation Act 1901.
(5) A standard under this section takes effect:
(a) if the instrument making the standard specifies a day for the purpose—on that day; or
(b) otherwise—on the day on which the standard was notified in the Gazette.
(6) A standard under this section is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.
87F Damages for breach of performance standards
(1) If:
(a) a carrier or service provider contravenes a standard in force under section 87E; and
(b) the contravention relates to a particular customer;
the carrier or service provider is liable to pay damages to the customer for the contravention.
(2) The amount of damages payable for a particular contravention is equal to the relevant amount specified in the scale in force under section 87G.
(3) The customer may recover the amount of the damages by action against the carrier or service provider in a court of competent jurisdiction.
(4) The liability of the carrier or service provider under this section may be discharged:
(a) by giving the customer a credit in an account the customer has with the carrier or service provider; or
(b) in any other manner agreed between the carrier or service provider and the customer.
(5) An action under this section must be instituted within 2 years after:
(a) in the case of a contravention that continued throughout a period—the time when the contravention began; or
(b) in any other case—the time when the contravention occurred.
(6) If the customer dies, a reference in this section to the customer includes a reference to the legal personal representative of the customer.
87G Scale of damages for breach of performance standards
(1) AUSTEL may, by written instrument, specify a scale of damages for contraventions of standards under section 87E.
(2) The scale must:
(a) specify categories of contraventions; and
(b) specify a dollar amount as the amount of damages payable for contraventions covered by each of those categories.
(3) A dollar amount specified in accordance with paragraph (2)(b) must not exceed $25,000.
(4) A category may be specified by reference to contraventions that continue over a specified number of days.
(5) Subsection (4) does not, by implication, limit the ways in which a category may be specified.
(6) An instrument under this section is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.
87H Evidentiary certificate issued by the Telecommunications Industry Ombudsman
(1) The Telecommunications Industry Ombudsman may issue a written certificate:
(a) stating that a specified carrier or service provider has contravened a standard in force under section 87E; and
(b) setting out particulars of that contravention.
(2) In any proceedings under this Division, a certificate under subsection (1) is prima facie evidence of the matters in the certificate.
(3) A document purporting to be a certificate under subsection (1) must, unless the contrary is established, be taken to be a certificate and to have been properly given.
(4) Subsection (1) does not apply to the Telecommunications Industry Ombudsman unless the Telecommunications Industry Ombudsman gives the Minister a written notice consenting to the conferral of the powers conferred by that subsection.
(5) If no notice is in force under subsection (4), subsection (1) has effect as if the reference in that subsection to the Telecommunications Industry Ombudsman were a reference to AUSTEL.
(6) The Minister must cause a copy of a notice under subsection (4) to be published in the Gazette.
(7) The continuity of a notice under subsection (4) is not affected by:
(a) a change in the occupancy of the position of Telecommunications Industry Ombudsman; or
(b) a vacancy in the position of Telecommunications Industry Ombudsman that does not continue for more than 4 months.
(8) Nothing in this section affects the right of a customer to complain to the Telecommunications Industry Ombudsman about a breach of a performance standard.
87J Waiver of customer service guarantee
(1) AUSTEL may, by written instrument, make provision for customers of carriers to waive, in whole or in part, their protection and rights under this Division in relation to a particular telecommunications service supplied, or proposed to be supplied, by the carrier concerned.
(2) If such a waiver is made, then, to the extent of the waiver, the carrier is not bound by, and need not comply with, any standards in force under section 87E in relation to the supply of that service to that customer.
(3) A waiver must be made in accordance with the rules set out in the instrument.
(4) An instrument under subsection (1) is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.
87K Savings of other laws and remedies
(1) This Division is not intended to exclude or limit the concurrent operation of any law of a State or Territory.
(2) This Division does not limit, restrict or otherwise affect any right or remedy a person would have if this Division had not been enacted.
87L Sections 121 and 122 do not apply to actions under this Division
Sections 121 and 122 do not apply to a cause of action under this Division.
Note: Sections 121 and 122 deal with limitation of tort liability.
87M Breach of performance standard is not an offence
A contravention of a standard in force under section 87E is not an offence.
87N Paragraph 62(a) does not apply to a breach of a performance standard
Paragraph 62(a) does not apply to a contravention of a standard in force under section 87E.
Note: Paragraph 62(a) imposes a licence condition that requires compliance with this Act.
87P Minister may direct AUSTEL about the use of its powers under this Division
(1) The Minister may give AUSTEL written directions about how AUSTEL is to exercise its powers under this Division.
(2) AUSTEL must comply with a direction under this section.
(3) This section does not affect the Minister’s power to give AUSTEL directions under other provisions about other matters.
(4) A direction under this section is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.
87Q Review of performance standards following Ministerial direction
(1) This section applies to a direction under section 87P that requires AUSTEL to make a standard under section 87E.
(2) If the Minister revokes a direction, AUSTEL must revoke the section 87E standard that is in force because of the direction.
(3) If the Minister varies a direction, AUSTEL must either:
(a) vary the section 87E standard that is in force because of the direction so that the standard complies with the varied direction; or
(b) revoke the section 87E standard and determine a new section 87E standard that so complies.
(4) If a section 87E standard is in force because of a direction:
(a) AUSTEL may vary the standard on its own initiative, but only in such a way that the varied standard still complies with the direction; and
(b) AUSTEL may, on its own initiative, revoke the standard and determine a new section 87E standard that so complies.
12 Before paragraph 333(a)
Insert:
(aa) a failure by a carrier or service provider to comply with an obligation, or discharge a liability, under Division 6 of Part 5; or
13 After paragraph 399(2)(b)
Insert:
(ba) compliance by the carriers or service providers with the standards developed under subparagraph 38(2)(b)(iv); and
14 After paragraph 399(2)(d)
Insert:
(da) the appropriateness and adequacy of the approaches taken by the carriers or service providers in carrying out their obligations, and discharging their liabilities, under Division 6 of Part 5; and
15 Section 400
After “time”, insert “and in the manner”.
16 At the end of section 400
Add:
(2) A notice under subsection (1) that relates to the giving of information may require the information to be given in a specified form.
17 Subsection 401(1)
After “time”, insert “and in the manner”.
18 After subsection 401(1)
Insert:
(1A) A notice under subsection (1) that relates to the giving of information may require the information to be given in a specified form.
19 Application—amendments of section 73 of the Telecommunications Act 1991
(1) This item applies to the amendments of section 73 of the Telecommunications Act 1991 made by this Schedule.
(2) The amendments do not apply in relation to a contract for the supply of a standard telephone service if:
(a) the contract was entered into before the commencement of this item; and
(b) the contract would not have complied with section 73 of the Telecommunications Act 1991 if it had been entered into immediately after the commencement of this item.
20 Title
Omit “to provide for Telstra Corporation Limited to take over the undertakings and assets of Telecom and OTC”, substitute “relating to Telstra Corporation Limited”.
21 Section 3 (definition of rights)
Before “means”, insert “(except in Parts 2, 2A, 2B and 2C and the Schedule)”.
22 Section 3
Insert:
constitution, in relation to Telstra, has the same meaning as in the Corporations Law.
Federal Court means the Federal Court of Australia.
minority-interest sale time means the first time after the commencement of Part 2A when a person other than the Commonwealth becomes the legal owner of any of the voting shares in Telstra.
sale-scheme trust deed has the meaning given by section 8AJ.
sale-scheme trustee has the meaning given by section 8AJ.
Senior Executive Service office has the same meaning as in the Public Service Act 1922.
Telstra sale scheme has the meaning given by section 8AJ.
Telstra subsidiary means a body corporate that is a subsidiary of Telstra.
unacceptable foreign-ownership situation has the meaning given by section 8BG.
23 Section 3
Add at the end:
Note: The Schedule sets out definitions of expressions used in Part 2A (which deals with ownership restrictions).
24 Part 2
Repeal the Part, substitute:
Part 2—Commonwealth ownership of Telstra
The following is a simplified outline of this Part:
• The Commonwealth may sell one-third of its equity interest in Telstra, but must retain the remaining two-thirds.
• This Part imposes reporting obligations on Telstra.
• This Part sets out rules about how that sale is to be carried out.
Division 2—Commonwealth to retain majority ownership of Telstra
8AB Commonwealth to retain majority ownership of Telstra
(1) The Commonwealth must not transfer any of its shares in Telstra if the transfer results in a breach of subsection (2).
(2) Neither the Commonwealth nor Telstra is allowed to do anything to cause or contribute to any of the following results:
(a) that the Commonwealth no longer holds shares in Telstra that carry the rights to exercise at least two-thirds of the total voting rights attached to the voting shares in Telstra;
(b) that the Commonwealth no longer controls the exercise of at least two-thirds of the total voting rights attached to the voting shares in Telstra;
(c) that the Commonwealth no longer holds at least two-thirds of the total paid-up share capital of Telstra;
(d) that the Commonwealth is no longer entitled to hold at least two-thirds of the total rights to any distribution of capital or profits of Telstra on winding-up;
(e) that the Commonwealth is no longer entitled to hold at least two-thirds of the total rights to any distribution of capital or profits of Telstra, otherwise than on winding-up.
(1) Telstra must take all reasonable steps to ensure that a situation described in paragraph 8AB(2)(a), (b), (c), (d) or (e) does not exist.
(2) If Telstra knowingly or recklessly contravenes subsection (1), Telstra is guilty of an offence punishable on conviction by a fine not exceeding 500 penalty units.
Division 3—Telstra’s reporting obligations
(1) The Minister may give Telstra a written direction requiring Telstra to give the Minister a specified financial statement or statements for a specified period or for each specified period.
(2) Telstra must comply with a direction under subsection (1).
(3) The following are examples of periods that may be specified under subsection (1):
(a) the first 3 months of each financial year;
(b) the first 6 months of each financial year;
(c) the first 9 months of each financial year;
(d) each financial year.
(4) The members of the Board must:
(a) prepare each statement in accordance with written guidelines given to the Board by the Minister; and
(b) give the statement to the Minister within 2 months after the end of the period to which the statement relates.
(5) The Minister may grant extensions of time in special circumstances.
(6) In this section:
financial statements includes financial statements for the group consisting of:
(a) Telstra; and
(b) Telstra subsidiaries.
8AE Minister to be notified of significant events
(1) If Telstra, or any Telstra subsidiary, proposes to do any of the following things, the members of the Board must immediately give the Minister written particulars of the proposal:
(a) form a company or participate in the formation of a company;
(b) participate in a significant partnership, trust, unincorporated joint venture or similar arrangement;
(c) acquire or dispose of a significant shareholding in a company;
(d) acquire or dispose of a significant business;
(e) commence or cease a significant business activity;
(f) make a significant change in the nature or extent of its interests in a partnership, trust, unincorporated joint venture or similar arrangement.
(2) The Minister may, by writing, exempt the members of the Board from the requirement to notify matters covered by paragraph (1)(a). The exemption may be granted subject to conditions.
(3) The Minister may give written guidelines to the Board that are to be used by the members in deciding whether a proposal is covered by paragraph (1)(b), (c), (d), (e) or (f).
8AF Keeping the Minister and the Minister for Finance informed
(1) The members of the Board must:
(a) keep the Minister informed of the operations of Telstra and Telstra subsidiaries; and
(b) give the Minister such reports, documents and information in relation to those operations as the Minister requires; and
(c) give the Minister for Finance such reports, documents and information in relation to those operations as the Minister for Finance requires.
(2) The members of the Board must comply with requirements under paragraphs (1)(b) and (c) within the time limits set by the Minister concerned.
8AG Corporate plan for Telstra
(1) The members of the Board must prepare a corporate plan at least once a year and give it to the Minister.
(2) The plan must cover a period of at least 3 years and not more than 5 years.
(3) If Telstra has subsidiaries, the plan must cover both Telstra and its subsidiaries. In particular, for each subsidiary the plan must include details of the matters in subsection (6), so far as they are applicable.
(4) The members of the Board must keep the Minister informed about changes to the plan.
(5) If the Board becomes aware that a particular matter may affect the achievement of the plan, the Board must give the Minister a written notice:
(a) setting out particulars of the matter; and
(b) explaining the effect of the matter on the achievement of the plan.
(6) The plan must include details of the following matters (so far as they are applicable):
(a) the objectives of the company;
(b) assumptions about the business environment in which the company operates;
(c) the business strategies of the company;
(d) the investment and financing programs of the company, including strategies for managing financial risk;
(e) financial targets and projections for the company;
(f) the dividend policy of the company;
(g) non-financial performance measures for the company;
(h) community service obligations of the company;
(i) review of performance against previous corporate plans and targets;
(j) analysis of factors likely to affect achievement of targets or create significant financial risk for the company or for the Commonwealth;
(k) price control and quality control strategies for goods or services supplied by the company under a monopoly;
(l) human resource strategies and industrial relations strategies.
(7) The plan must also cover any other matters required by the Minister (which may include further details about the matters in subsection (6)).
8AH Consequences of contraventions of this Division
A contravention of this Division is not an offence. However, a contravention of this Division is a ground for obtaining an injunction under Division 1 of Part 2B.
8AI This Division has effect despite the Corporations Law etc.
To avoid doubt, the operation of this Division does not result in a contravention of, or give rise to a liability or remedy under:
(a) a provision of the Corporations Law; or
(b) a rule of common law or equity (other than a rule of administrative law).
Division 4—Provisions relating to the sale by the Commonwealth of its shares in Telstra
(1) The object of this section is to define the expressions Telstra sale scheme, sale-scheme trustee and sale-scheme trust deed.
(2) For the purposes of this Act, a Telstra sale scheme is a scheme the object of which is to achieve the transfer, or progressive transfer, of a part of the Commonwealth’s equity in Telstra to other persons.
(3) A Telstra sale scheme must be consistent with sections 8AB and 8AC.
(4) A Telstra sale scheme may involve any or all of the following:
(a) the transfer by the Commonwealth of any of its shares in Telstra;
(b) the transfer by the Commonwealth of interests in its shares in Telstra to a company (the sale-scheme trustee) in the company’s capacity as the trustee of a trust established by a trust deed (the sale-scheme trust deed);
(c) an investor in Telstra initially acquiring a particular interest in shares in Telstra and subsequently acquiring the remaining interests in those shares;
(d) the payment by Telstra of a dividend;
(e) the reduction of Telstra’s share capital;
(f) the cancellation of a particular parcel of shares in Telstra held by the Commonwealth;
(g) Telstra buying back shares in itself;
(h) the issue of securities in Telstra;
(i) the redemption of redeemable preference shares in Telstra held by the Commonwealth;
(j) the alteration of Telstra’s constitution.
(5) In determining whether a scheme is a Telstra sale scheme, regard must be had to the economic and commercial substance of the scheme.
(6) Subsections (4) and (5) do not, by implication, limit subsection (2).
(7) In this section:
interest in a share has the same meaning as it has for the purposes of Part 2A.
scheme means:
(a) any agreement, arrangement, understanding, promise or undertaking, whether express or implied; and
(b) any scheme, plan, proposal, action, course of action or course of conduct, whether unilateral or otherwise.
securities includes:
(a) shares; and
(b) debentures (within the meaning of the Corporations Law).
transfer, in relation to an interest in a share, includes the creation of the interest.
8AK Exemption from stamp duty—transfer by the Commonwealth of its shares in Telstra etc.
(1) In this section:
designated matter means any of the following matters, where the matter relates to the entering into or carrying out of a Telstra sale scheme:
(a) the transfer by the Commonwealth of:
(i) a share in Telstra held by the Commonwealth; or
(ii) an interest in such a share;
(b) an agreement relating to a transfer covered by paragraph (a);
(c) the receipt of money by the Commonwealth, or by a person acting on behalf of the Commonwealth, in respect of a transfer covered by paragraph (a);
(d) the transfer by the sale-scheme trustee of:
(i) a share in Telstra held by the trustee; or
(ii) an interest in such a share;
where the transfer is in accordance with the sale-scheme trust deed;
(e) an agreement relating to a transfer covered by paragraph (d);
(f) the receipt of money by the sale-scheme trustee, or by a person acting on behalf of the sale-scheme trustee, in respect of a transfer covered by paragraph (d);
(g) the reduction of Telstra’s share capital;
(h) the cancellation of a particular parcel of shares in Telstra held by the Commonwealth;
(i) Telstra buying back shares in itself;
(j) the issue of securities in Telstra;
(k) the redemption of redeemable preference shares in Telstra held by the Commonwealth;
(l) any other matter that is specified in the regulations.
interest in a share has the same meaning as it has for the purposes of Part 2A.
securities includes:
(a) shares; and
(b) debentures (within the meaning of the Corporations Law).
transfer, in relation to an interest in a share, includes the creation of the interest.
(2) Stamp duty or other tax is not payable under a law of a State or Territory in respect of:
(a) a designated matter; or
(b) anything done (including a transaction entered into or an instrument or document made, executed, lodged or given) because of, or for a purpose connected with or arising out of, a designated matter.
8AL Appropriation—costs incurred in connection with a Telstra sale scheme
(1) The Consolidated Revenue Fund is appropriated to the extent necessary for the purposes of the payment or discharge of the costs, expenses and other obligations incurred by the Commonwealth in connection with the formulation, entering into, or carrying out, of a Telstra sale scheme.
(2) The costs and expenses covered by subsection (1) include (but are not limited to) the following:
(a) legal and accounting fees;
(b) costs of undertaking due diligence inquiries;
(c) underwriting fees;
(d) costs associated with an offer document;
(e) marketing expenses;
(f) other administrative and logistical expenses.
8AM Commonwealth takeover of certain obligations of Telstra or Telstra subsidiaries
(1) This section applies to an obligation (whether contingent or otherwise) of Telstra or a Telstra subsidiary.
(2) The Treasurer may, on the Commonwealth’s behalf:
(a) at or before the minority-interest sale time; and
(b) in order to facilitate, either directly or indirectly, the formulation, entering into, or carrying out, of a Telstra sale scheme;
enter into an agreement to take over an obligation.
8AN Authorisation of payments—Commonwealth takeover of obligations
If the Treasurer enters into an agreement under subsection 8AM(2), the Treasurer may authorise the payment of money to discharge the Commonwealth’s obligations under the agreement, whether by terminating those obligations or otherwise.
8AO Appropriation—Commonwealth takeover of obligations
A payment under section 8AN is to be made out of the Consolidated Revenue Fund, which is appropriated accordingly.
8AP Application of the Loans Securities Act 1919
Sections 5A, 5B, 5C and 5D (other than paragraphs (1)(c) and (2)(c)) of the Loans Securities Act 1919 apply in relation to an obligation that is taken over by the Commonwealth under section 8AM as if that obligation were a borrowing of money outside Australia:
(a) that the Treasurer was authorised to make on behalf of the Commonwealth; and
(b) that the Treasurer made accordingly.
8AQ Assistance given by Telstra or the Board in connection with a Telstra sale scheme
(1) Telstra may, on its own initiative, assist the Commonwealth in connection with the formulation, entering into, or carrying out, of a Telstra sale scheme.
(2) A member of the Board may, on the member’s own initiative, assist the Commonwealth in connection with the formulation, entering into, or carrying out, of a Telstra sale scheme.
(3) Telstra must, when requested in writing by the Minister or the Minister for Finance to do so, assist the Commonwealth in connection with the formulation, entering into, or carrying out, of a Telstra sale scheme. The assistance is to be given within the period, and in the form and manner, specified in the request.
(4) The Board must, when requested in writing by the Minister or the Minister for Finance to do so, assist the Commonwealth in connection with the formulation, entering into, or carrying out, of a Telstra sale scheme. The assistance is to be given within the period, and in the form and manner, specified in the request.
(5) To avoid doubt, the giving of assistance as mentioned in subsection (1), (2), (3) or (4), or the making of a request under subsection (3) or (4), does not result in a contravention of, or give rise to a liability or remedy under:
(a) a provision of the Corporations Law; or
(b) a rule of common law or equity (other than a rule of administrative law).
(6) A contravention of subsection (3) or (4) is not an offence. However, a contravention of subsection (3) or (4) is a ground for obtaining an injunction under Division 1 of Part 2B.
8AR Giving of assistance—ancillary provisions
(1) The assistance mentioned in subsection 8AQ(1), (2), (3) or (4) may take the form of:
(a) the giving of information; or
(b) the giving of financial assistance (within the meaning of section 205 of the Corporations Law); or
(c) the giving of a financial benefit to a related party (within the meaning of Part 3.2A of the Corporations Law); or
(d) the provision, by Telstra’s directors or employees, of facilities, information and other assistance in connection with the conduct of:
(i) a due diligence procedure or a similar process; or
(ii) a market briefing or a similar process.
(2) For the purposes of paragraph (1)(b), if section 205 of the Corporations Law is repealed and replaced by another provision of the Corporations Law that deals with the giving of financial assistance by companies, the reference in that paragraph to section 205 is to be read as a reference to the replacement provision.
(3) For the purposes of paragraph (1)(c), if Part 3.2A of the Corporations Law is repealed and replaced by another provision of the Corporations Law that deals with the giving of financial benefits to related parties, the reference in that paragraph to Part 3.2A is to be read as a reference to the replacement provision.
(4) Subsection (1) does not, by implication, limit the forms in which assistance may be given.
(5) Section 8AQ does not, by implication, limit any rights that are conferred on shareholders by other laws.
(6) Section 8AQ does not authorise the imposition of taxation (within the meaning of section 55 of the Constitution).
(7) Section 8AQ does not, by implication, limit:
(a) the executive power of the Commonwealth to enter into an agreement; or
(b) the capacity of Telstra, or of a member of the Board, to enter into an agreement with the Commonwealth.
Note: This ensures, for example, that the Commonwealth can enter into a co-operation agreement with Telstra or with a member of the Board.
(8) Section 8AQ extends to the giving of assistance outside Australia, whether or not in a foreign country.
8AS Reimbursement of expenses incurred in giving assistance
(1) This section applies if:
(a) assistance is given under section 8AQ; and
(b) the assistance is of a kind mentioned in paragraph 8AR(1)(b) or (c); and
(c) Telstra or a member of the Board incurs expenses in relation to the giving of that assistance.
(2) The Minister for Finance may authorise the payment by the Commonwealth to Telstra, or to the member, as the case may be, of an amount equal to so much of those expenses as the Minister for Finance considers reasonable.
(3) The Consolidated Revenue Fund is appropriated for the purposes of making payments under subsection (2).
8AT Commonwealth to be bound by Chapter 7 of the Corporations Law
(1) Chapter 7 of the Corporations Law binds the Crown in right of the Commonwealth to the extent to which that Chapter deals with the formulation, entering into, or carrying out, of a Telstra sale scheme.
(2) Subsection (1) has effect despite anything in the following laws:
(a) the Corporations Act 1989;
(b) the Corporations (New South Wales) Act 1990 of New South Wales;
(c) the Corporations (Northern Territory) Act 1990 of the Northern Territory;
(d) the Corporations (Queensland) Act 1990 of Queensland;
(e) the Corporations (South Australia) Act 1990 of South Australia;
(f) the Corporations (Tasmania) Act 1990 of Tasmania;
(g) the Corporations (Victoria) Act 1990 of Victoria;
(h) the Corporations (Western Australia) Act 1990 of Western Australia.
(3) This section does not render the Crown in right of the Commonwealth liable to be prosecuted for an offence.
(4) For the purposes of subsection (1), if Chapter 7 of the Corporations Law is repealed and replaced by another provision of the Corporations Law that deals with securities regulation, the reference in that subsection to Chapter 7 is to be read as a reference to the replacement provision.
8AU Alterations of Telstra’s constitution
(1) This section applies to an alteration of Telstra’s constitution if:
(a) the alteration occurs before the minority-interest sale time; and
(b) the alteration relates to the formulation, entering into, or carrying out, of a Telstra sale scheme.
(2) A notice of a general meeting specifying an intention to propose a resolution for the alteration does not have to be given to:
(a) trustees for debenture holders; or
(b) debenture holders.
(3) A court is not empowered to cancel the alteration.
(4) Subsections (2) and (3) have effect despite anything in section 172 of the Corporations Law.
(5) For the purposes of subsection (4), if section 172 of the Corporations Law is repealed and replaced by another provision of the Corporations Law that deals with the alteration of a company’s constitution, the reference in that subsection to section 172 is to be read as a reference to the replacement provision.
(6) In this section:
debenture has the same meaning as in the Corporations Law.
8AV Reduction of Telstra’s share capital
(1) This section applies to a reduction of Telstra’s share capital if:
(a) the reduction relates to the formulation, entering into, or carrying out, of a Telstra sale scheme; and
(b) the reduction is part of an overall arrangement or plan that involves:
(i) the replacement of a particular type of share with one or more other types of share; and
(ii) the replacement of the reduced share capital.
(2) Notice of the reduction does not have to be given to Telstra’s creditors.
(3) Telstra’s creditors are not entitled to object to the reduction.
(4) The reduction does not have to be confirmed by a court.
(5) Subsections (2), (3) and (4) have effect despite anything in section 195 of the Corporations Law.
(6) For the purposes of subsection (5), if section 195 of the Corporations Law is repealed and replaced by another provision of the Corporations Law that deals with the reduction of a company’s share capital, the reference in that subsection to section 195 is to be read as a reference to the replacement provision.
8AW Use by the Commonwealth of information obtained from Telstra or the Board
(1) This section applies to information obtained under Division 3 or section 8AQ.
(2) The Commonwealth, or an associated person, may use the information for a purpose in connection with the formulation, entering into, or carrying out, of a Telstra sale scheme.
(3) The Commonwealth, or an associated person, may disclose the information for a purpose in connection with the formulation, entering into, or carrying out, of a Telstra sale scheme.
(4) If subsection (2) or (3) does not apply, the Commonwealth, or an associated person, may use or disclose the information for a purpose in connection with the Commonwealth’s capacity as a shareholder in Telstra, so long as the use or disclosure does not involve giving the information to a person who is not an associated person.
(5) To avoid doubt, the use or disclosure of information as mentioned in subsection (2), (3) or (4) does not result in a contravention of, or give rise to a liability or remedy under:
(a) a provision of the Corporations Law; or
(b) a rule of common law or equity (other than a rule of administrative law).
(6) In this section:
associated person means:
(a) a Minister; or
(b) an individual who holds an office under, or is employed by, the Commonwealth; or
(c) an officer or employee within the meaning of the Public Service Act 1922; or
(d) a person who performs services for or on behalf of the Commonwealth in connection with:
(i) the formulation, entering into, or carrying out, of a Telstra sale scheme; or
(ii) the Commonwealth’s capacity as a shareholder in Telstra.
8AX Agreements relating to the protection of information obtained from Telstra or the Board
(1) The Minister for Finance may, on behalf of the Commonwealth, enter into an agreement with Telstra, or with one or more members of the Board, relating to the protection of information:
(a) that is obtained under Division 3 or section 8AQ; and
(b) the publication of which might be expected to prejudice substantially Telstra’s commercial interests.
(2) The agreement may be enforced as if it were a contract.
(3) This section does not, by implication, limit the executive power of the Commonwealth to enter into agreements.
8AY Telstra’s obligations to disclose information
(1) To avoid doubt, the mere fact that particular information was requested, required or given under Division 3 or section 8AQ is not a ground on which Telstra can be required to disclose or notify that, or any other, information under:
(a) a provision of the Corporations Law; or
(b) a provision of the listing rules of a securities exchange.
(2) In this section:
listing rules has the same meaning as in section 1001A of the Corporations Law.
securities exchange has the same meaning as in section 1001A of the Corporations Law.
(3) For the purposes of subsection (2), if section 1001A of the Corporations Law is repealed and replaced by another provision of the Corporations Law that deals with continuous disclosure by listed companies, a reference in that subsection to section 1001A is to be read as a reference to the replacement provision.
8AZ Rights of Telstra’s shareholders, debenture holders and creditors to be subject to this Act
(1) The rights of Telstra’s shareholders, debenture holders and creditors are subject to this Act.
(2) In this section:
debenture has the same meaning as in the Corporations Law.
8BA Compensation—constitutional safety net
(1) If:
(a) apart from this section, the operation of this Part would result in the acquisition of property from a person otherwise than on just terms; and
(b) the acquisition would be invalid because of paragraph 51(xxxi) of the Constitution;
the Commonwealth is liable to pay compensation of a reasonable amount to the person in respect of the acquisition.
(2) If the Commonwealth and the person do not agree on the amount of the compensation, the person may institute proceedings in the Federal Court for the recovery from the Commonwealth of such reasonable amount of compensation as the court determines.
(3) The Consolidated Revenue Fund is appropriated for the purposes of making payments under this section.
(1) The Minister may, by writing, delegate to:
(a) the Secretary to the Department; or
(b) a person holding or performing the duties of a Senior Executive Service office (whether or not in the Department);
all or any of the Minister’s powers under this Part.
(2) The Minister for Finance may, by writing, delegate to:
(a) the Secretary to the Department of Finance; or
(b) a person holding or performing the duties of a Senior Executive Service office (whether or not in the Department of Finance);
all or any of the powers conferred on the Minister for Finance by this Part.
8BC Provision to attract the corporations power and the communications power
This Part does not apply to Telstra unless Telstra:
(a) is a corporation to which paragraph 51(xx) of the Constitution applies; or
(b) carries on a business that consists of or includes the supply of a telecommunications service (within the meaning of the Telecommunications Act 1991).
Part 2A—Restrictions on ownership of Telstra
The following is a simplified outline of this Part:
• Telstra is subject to the following ownership restrictions:
(a) a limit on total foreign ownership;
(b) a limit on individual foreign ownership.
• The regulations may require information to be given for purposes relating to those limits.
• Telstra’s head office, base of operations and place of incorporation are to remain in Australia.
• Telstra’s Chairperson, and a majority of Telstra’s directors, must be Australian citizens.
Division 2—Definitions in Schedule
The Schedule sets out definitions of expressions used in this Part.
Note 1: The limits on the ownership of Telstra relate to a person’s stake in Telstra.
Note 2: Stake is defined in the Schedule.
Note 3: A person’s stake includes the interests of the person’s associates.
Note 4: There are 4 different types of stake. The main types are the percentage of total paid-up share capital and the percentage of voting power.
Note 5: The ownership restrictions will be breached if any type of stake goes over the relevant limit.
Division 3—Extra-territorial operation
8BF Extra-territorial operation
The following provisions extend to acts, omissions, matters and things outside Australia, whether or not in a foreign country:
(a) this Part and the Schedule;
(b) Part 2B, to the extent to which it relates to this Part.
Division 4—Limit on foreign ownership
8BG Meaning of unacceptable foreign-ownership situation
For the purposes of this Act, an unacceptable foreign-ownership situation exists in relation to Telstra if:
(a) there is a group of foreign persons who hold, in total, a particular type of stake in Telstra of more than 11.6667%; or
(b) there is or are one or more foreign persons each of whom holds a particular type of stake in Telstra of more than 1.6667%.
Note 1: 11.6667% is equal to 35% of one-third (rounded up to 4 decimal places).
Note 2: 1.6667% is equal to 5% of one-third (rounded up to 4 decimal places).
Note 3: The percentages specified in this section may be reduced if the Commonwealth’s one-third equity interest in Telstra is transferred in 2 or more tranches—see section 8BK.
Note 4: A person’s stake includes the interests of the person’s associates—see the Schedule.
If:
(a) a person, or 2 or more persons under an arrangement, acquire shares in a company; and
(b) the acquisition has the result, in relation to Telstra, that:
(i) an unacceptable foreign-ownership situation comes into existence in relation to Telstra; or
(ii) if an unacceptable foreign-ownership situation already exists in relation to Telstra because there is a group of foreign persons who hold, in total, a particular type of stake in Telstra of more than 11.6667%—there is an increase in the total of any type of stake held by any group of foreign persons in Telstra; or
(iii) if an unacceptable foreign-ownership situation already exists in relation to Telstra because there is or are one or more foreign persons each of whom holds a particular type of stake in Telstra of more than 1.6667%—there is an increase in any type of stake held by any of those foreign persons; and
(c) the person or persons mentioned in paragraph (a) knew, or were reckless as to whether, the acquisition would have that result;
the person or persons mentioned in paragraph (a) are guilty of an offence punishable on conviction by a fine not exceeding 400 penalty units.
Note 1: 11.6667% is equal to 35% of one-third (rounded up to 4 decimal places).
Note 2: 1.6667% is equal to 5% of one-third (rounded up to 4 decimal places).
Note 3: The percentages specified in this section may be reduced if the Commonwealth’s one-third equity interest in Telstra is transferred in 2 or more tranches—see section 8BK.
(1) Telstra must take all reasonable steps to ensure that an unacceptable foreign-ownership situation does not exist in relation to Telstra.
(2) If Telstra knowingly or recklessly contravenes subsection (1), Telstra is guilty of an offence punishable on conviction by a fine not exceeding 500 penalty units.
(1) If an unacceptable foreign-ownership situation exists in relation to Telstra, the Federal Court may, on application by the Minister or Telstra, make such orders as the court considers appropriate for the purpose of ensuring that that situation ceases to exist.
(2) The Federal Court’s orders include:
(a) an order directing the disposal of shares; or
(b) an order restraining the exercise of any rights attached to shares; or
(c) an order prohibiting or deferring the payment of any sums due to a person in respect of shares held by the person; or
(d) an order that any exercise of rights attached to shares be disregarded.
(3) Subsection (2) does not, by implication, limit subsection (1).
(4) In addition to the Federal Court’s powers under subsections (1) and (2), the court:
(a) has power, for the purpose of securing compliance with any other order made under this section, to make an order directing any person to do or refrain from doing a specified act; and
(b) has power to make an order containing such ancillary or consequential provisions as the court thinks just.
(5) The Federal Court may, before making an order under this section, direct that notice of the application be given to such persons as it thinks fit or be published in such manner as it thinks fit, or both.
(6) The Federal Court may, by order, rescind, vary or discharge an order made by it under this section or suspend the operation of such an order.
Division 5—Special provisions that apply if the Commonwealth’s one-third equity interest in Telstra is transferred in 2 or more tranches
8BK Regulations reducing the ownership limit percentages
(1) The object of the section is to allow the regulations to reduce the ownership limit percentages in the event that the Commonwealth’s one-third equity interest in Telstra is transferred in 2 or more tranches.
(2) The regulations may provide that this Part has effect as if:
(a) each reference in Division 4 to 11.6667% were a reference to such lower percentage as is specified in the regulations; and
(b) each reference in Division 4 to 1.6667% were a reference to such lower percentage as is specified in the regulations.
(3) If any regulations are made for the purposes of this section, the first of those regulations must be made before the minority-interest sale time.
(4) Subsection (2) does not apply to a reference in a note set out at the end of a section.
8BL Rules about regulations reducing the ownership limit percentages
(1) This section applies to regulations made for the purposes of section 8BK.
(2) If any of those regulations is repealed, the remaining regulations are repealed.
(3) If the regulations are repealed, no further regulations may be made for the purposes of section 8BK.
(4) A regulation (the principal regulation) must not be amended for the purpose of reducing the percentage specified in the principal regulation.
(1) If:
(a) one or more persons enter into, begin to carry out or carry out a scheme; and
(b) it would be concluded that the person, or any of the persons, who entered into, began to carry out or carried out the scheme or any part of the scheme did so for the sole or dominant purpose of avoiding the application of any provision of Division 4 in relation to any person or persons (whether or not mentioned in paragraph (a)); and
(c) as a result of the scheme or a part of the scheme, a person (the stakeholder) increases the stakeholder’s stake in Telstra;
the Minister may give the stakeholder a written direction to cease holding that stake within a specified time.
(2) A person who intentionally contravenes a direction under subsection (1) is guilty of an offence punishable on conviction by a fine not exceeding 400 penalty units.
Division 7—Record-keeping and giving of information
8BN Record-keeping and giving of information
(1) The regulations may make provision for and in relation to requiring a person:
(a) to keep and retain records, where the records are relevant to an ownership matter; and
(b) to give information to the Minister that is relevant to an ownership matter; and
(c) to give information to Telstra, where the information is relevant to an ownership matter.
Note: Ownership matter is defined by subsection (6).
Statutory declarations
(2) The regulations may provide that information given in accordance with a requirement covered by paragraph (1)(b) or (c) must be verified by statutory declaration.
No self-incrimination
(3) An individual is not required to give information in accordance with a requirement covered by paragraph (1)(b) or (c) if the information might tend to incriminate the individual or expose the individual to a penalty.
Offence
(4) A person must not intentionally contravene a requirement covered by paragraph (1)(a), (b) or (c).
Penalty: 50 penalty units.
Regulations may confer discretionary powers on the Minister
(5) Regulations made for the purposes of this section may make provision for or in relation to a matter by conferring a power on the Minister. For example, the regulations could provide that the Minister may, by written notice given to Telstra, require Telstra to give the Minister, within the period and in the manner specified in the notice, specified information about an ownership matter.
Definition
(6) For the purposes of this section, each of the following matters is an ownership matter:
(a) whether a person holds a particular type of stake in Telstra;
(b) if a person holds a particular type of stake in Telstra—the level of that stake.
(1) A person must not, in purported compliance with a requirement covered by paragraph 8BN(1)(a), make a record of any matter or thing in such a way that it does not correctly record the matter or thing.
(2) A person who intentionally or recklessly contravenes subsection (1) is guilty of an offence punishable on conviction by imprisonment for a term not exceeding 6 months.
8BP False or misleading information
A person who, in purported compliance with a requirement covered by paragraph 8BN(1)(b) or (c), knowingly or recklessly:
(a) gives information to the Minister or to Telstra that is false or misleading in a material particular; or
(b) omits from information given to the Minister or to Telstra any matter or thing without which the information is misleading in a material particular;
is guilty of an offence punishable on conviction by imprisonment for a term not exceeding 6 months.
Division 8—Head office, base of operations and place of incorporation of Telstra
8BQ Head office to be in Australia
(1) Telstra must ensure that the central management and control of Telstra is ordinarily exercised at a place in Australia.
(2) A contravention of subsection (1) is not an offence. However, a contravention of subsection (1) is a ground for obtaining an injunction under Division 1 of Part 2B.
(3) A contravention of subsection (1) does not affect the validity of any transaction.
8BR Base of operations to be in Australia
(1) Telstra must ensure that it maintains a substantial business and operational presence in Australia.
(2) This section does not limit Telstra’s capacity to engage in activities outside Australia.
(3) A contravention of subsection (1) is not an offence. However, a contravention of subsection (1) is a ground for obtaining an injunction under Division 1 of Part 2B.
(4) A contravention of subsection (1) does not affect the validity of any transaction.
8BS Telstra to remain incorporated in Australia
(1) Telstra must ensure that it remains incorporated under the Corporations Law of the Australian Capital Territory.
(2) A contravention of subsection (1) is not an offence. However, a contravention of subsection (1) is a ground for obtaining an injunction under Division 1 of Part 2B.
(3) A contravention of subsection (1) does not affect the validity of any transaction.
Division 9—Citizenship of Chairperson and directors of Telstra
8BT Chairperson must be an Australian citizen
(1) Telstra must ensure that its Chairperson (however described) is an Australian citizen.
(2) A contravention of subsection (1) is not an offence. However, a contravention of subsection (1) is a ground for obtaining an injunction under Division 1 of Part 2B.
(3) A contravention of subsection (1) does not affect the validity of any transaction.
8BU Majority of directors must be Australian citizens
(1) Telstra must ensure that a majority of its directors are Australian citizens.
(2) A contravention of subsection (1) is not an offence. However, a contravention of subsection (1) is a ground for obtaining an injunction under Division 1 of Part 2B.
(3) A contravention of subsection (1) does not affect the validity of any transaction.
8BV Separate classes of shares in Telstra
(1) The Minister may, by notice published in the Gazette before the minority‑interest sale time, require that Telstra’s constitution must contain such provisions relating to classes of Telstra’s ordinary share capital as are specified in the direction.
(2) A requirement under subsection (1) may consist of or include any or all of the following:
(a) a requirement that Telstra’s constitution must contain a provision dividing the ordinary share capital of Telstra into particular classes of shares;
(b) a requirement that Telstra’s constitution must contain a provision imposing restrictions on the issue and ownership of a specified class of shares so as to prevent foreign persons, and associates of foreign persons, from holding interests in that class of shares;
(c) a requirement that Telstra’s constitution must contain a provision imposing restrictions on the issue and ownership of a specified class of shares so as to prevent persons other than the Commonwealth from holding interests in that class of shares.
(3) Subsection (2) does not, by implication, limit subsection (1).
(4) A contravention of a notice under subsection (1) is taken to be a contravention of this section.
(5) Telstra must comply with a provision contained in its constitution as a result of a notice under subsection (1).
(6) A contravention of this section is not an offence. However, a contravention of this section is a ground for obtaining an injunction under Division 1 of Part 2B.
(7) A contravention of this section does not affect the validity of any transaction.
(8) The requirements of this section are in addition to the requirements of section 8BI.
(9) Clause 9 of the Schedule does not apply for the purposes of this section.
8BW Concurrent operation of State/Territory laws
It is the intention of the Parliament that this Part is not to apply to the exclusion of a law of a State or Territory to the extent that that law is capable of operating concurrently with this Part.
8BX Validity of acts done in contravention of this Part
An act is not invalidated by the fact that it constitutes an offence against this Part.
8BY Winding-up of Telstra not prevented by this Act
This Act does not, by implication, prevent Telstra being wound up in accordance with the Corporations Law.
The Federal Court must not make an order under this Part if:
(a) the order would result in the acquisition of property from a person otherwise than on just terms; and
(b) the order would be invalid because of paragraph 51(xxxi) of the Constitution.
8CA Review of decisions by Administrative Appeals Tribunal
(1) Applications may be made to the Administrative Appeals Tribunal for review of decisions made by the Minister under:
(a) subsection 8BM(1); or
(b) subclause 9(2) or (3) of the Schedule.
(2) If the Minister:
(a) makes a decision of a kind covered by subsection (1); and
(b) gives to the person or persons whose interests are affected by the decision written notice of the making of the decision;
that notice is to include a statement to the effect that, subject to the Administrative Appeals Tribunal Act 1975, application may be made to the Administrative Appeals Tribunal for review of the decision.
(3) A failure to comply with subsection (2) does not affect the validity of a decision.
(4) In this section:
decision has the same meaning as in the Administrative Appeals Tribunal Act 1975.
(1) The Minister may, by writing, delegate to:
(a) the Secretary to the Department; or
(b) a person holding or performing the duties of a Senior Executive Service office (whether or not in the Department);
all or any of the Minister’s powers under:
(c) this Part; or
(d) the Schedule; or
(e) regulations made for the purposes of section 8BN.
(2) The Minister for Finance may, by writing, delegate to:
(a) the Secretary to the Department of Finance; or
(b) a person holding or performing the duties of a Senior Executive Service office (whether or not in the Department of Finance);
all or any of the powers conferred on the Minister for Finance by this Part.
8CC Provision to attract the corporations power and the communications power
This Part does not apply to Telstra unless Telstra:
(a) is a corporation to which paragraph 51(xx) of the Constitution applies; or
(b) carries on a business that consists of or includes the supply of a telecommunications service (within the meaning of the Telecommunications Act 1991).
Part 2B—Remedial provisions relating to the ownership of Telstra
Restraining injunctions
(1) If a person has engaged, is engaging or is proposing to engage in any conduct in contravention of Part 2 or 2A, the Federal Court may, on the application of the Minister, grant an injunction:
(a) restraining the person from engaging in the conduct; and
(b) if, in the court’s opinion, it is desirable to do so—requiring the person to do something.
(2) If a person has engaged, is engaging or is proposing to engage in any conduct in contravention of section 8BH, the Federal Court may, on the application of Telstra, grant an injunction:
(a) restraining the person from engaging in the conduct; and
(b) if, in the court’s opinion, it is desirable to do so—requiring the person to do something.
Performance injunctions
(3) If:
(a) a person has refused or failed, or is refusing or failing, or is proposing to refuse or fail, to do an act or thing; and
(b) the refusal or failure was, is or would be a contravention of Part 2 or 2A;
the Federal Court may, on the application of the Minister, grant an injunction requiring the person to do that act or thing.
(4) If:
(a) a person has refused or failed, or is refusing or failing, or is proposing to refuse or fail, to do an act or thing; and
(b) the refusal or failure was, is or would be a contravention of subsection 8BN(4) that relates to a requirement covered by paragraph 8BN(1)(c) ;
the Federal Court may, on the application of Telstra, grant an injunction requiring the person to do that act or thing.
Grant of interim injunction
(1) If an application is made to the court for an injunction under section 8CD, the court may, before considering the application, grant an interim injunction restraining a person from engaging in conduct of a kind referred to in that section.
No undertakings as to damages
(2) The court is not to require an applicant for an injunction under section 8CD, as a condition of granting an interim injunction, to give any undertakings as to damages.
8CF Discharge etc. of injunctions
The court may discharge or vary an injunction granted under this Division.
8CG Certain limits on granting injunctions not to apply
Restraining injunctions
(1) The power of the court under this Division to grant an injunction restraining a person from engaging in conduct of a particular kind may be exercised:
(a) if the court is satisfied that the person has engaged in conduct of that kind—whether or not it appears to the court that the person intends to engage again, or to continue to engage, in conduct of that kind; or
(b) if it appears to the court that, if an injunction is not granted, it is likely that the person will engage in conduct of that kind—whether or not the person has previously engaged in conduct of that kind and whether or not there is an imminent danger of substantial damage to any person if the person engages in conduct of that kind.
Performance injunctions
(2) The power of the court under this Division to grant an injunction requiring a person to do an act or thing may be exercised:
(a) if the court is satisfied that the person has refused or failed to do that act or thing—whether or not it appears to the court that the person intends to refuse or fail again, or to continue to refuse or fail, to do that act or thing; or
(b) if it appears to the court that, if an injunction is not granted, it is likely that the person will refuse or fail to do that act or thing—whether or not the person has previously refused or failed to do that act or thing and whether or not there is an imminent danger of substantial damage to any person if the person refuses or fails to do that act or thing.
8CH Other powers of the court unaffected
The powers conferred on the court under this Division are in addition to, and not instead of, any other powers of the court, whether conferred by this Act or otherwise.
8CI Prosecutions of corporations
State of mind
(1) If, in proceedings for an offence against Part 2 or 2A in respect of conduct engaged in by a corporation, it is necessary to establish the state of mind of the corporation, it is sufficient to show that:
(a) a director, employee or agent of the corporation engaged in that conduct; and
(b) the director, employee or agent was, in engaging in that conduct, acting within the scope of his or her actual or apparent authority; and
(c) the director, employee or agent had that state of mind.
Conduct
(2) If:
(a) conduct is engaged in on behalf of a corporation by a director, employee or agent of the corporation; and
(b) the conduct is within the scope of his or her actual or apparent authority;
the conduct is taken, for the purposes of a prosecution for an offence against Part 2 or 2A, to have been engaged in by the corporation unless the corporation establishes that it took reasonable precautions and exercised due diligence to avoid the conduct.
Extended meaning of state of mind
(3) A reference in subsection (1) to the state of mind of a person includes a reference to:
(a) the knowledge, intention, opinion, belief or purpose of the person; and
(b) the person’s reasons for the intention, opinion, belief or purpose.
Extended meaning of director
(4) A reference in this section to a director of a corporation includes a reference to a constituent member of a body corporate incorporated for a public purpose by a law of the Commonwealth, a State or a Territory.
Extended meaning of engaging in conduct
(5) A reference in this section to engaging in conduct includes a reference to failing or refusing to engage in conduct.
Extended meaning of offence against Part 2 or 2A
(6) A reference in this section to an offence against Part 2 or 2A includes a reference to an offence created by section 6, 7 or 7A or subsection 86(1) of the Crimes Act 1914 that relates to Part 2 or 2A.
8CJ Prosecutions of persons other than corporations
State of mind
(1) If, in proceedings for an offence against Part 2 or 2A in respect of conduct engaged in by a person other than a corporation, it is necessary to establish the state of mind of the person, it is sufficient to show that:
(a) the conduct was engaged in by an employee or agent of the person within the scope of his or her actual or apparent authority; and
(b) the employee or agent had that state of mind.
Conduct
(2) If:
(a) conduct is engaged in on behalf of a person other than a corporation by an employee or agent of the person; and
(b) the conduct is within the employee’s or agent’s actual or apparent authority;
the conduct is taken, for the purposes of a prosecution for an offence against Part 2 or 2A, to have been engaged in by the person unless the person establishes that he or she took reasonable precautions and exercised due diligence to avoid the conduct.
Limitation on imprisonment
(3) Despite any other provision of Part 2 or 2A, if:
(a) a person is convicted of an offence; and
(b) the person would not have been convicted of the offence if subsections (1) and (2) had not been in force;
the person is not liable to be punished by imprisonment for that offence.
Extended meaning of state of mind
(4) A reference in subsection (1) to the state of mind of a person includes a reference to:
(a) the knowledge, intention, opinion, belief or purpose of the person; and
(b) the person’s reasons for the intention, opinion, belief or purpose.
Extended meaning of engaging in conduct
(5) A reference in this section to engaging in conduct includes a reference to failing or refusing to engage in conduct.
Extended meaning of offence against Part 2 or 2A
(6) A reference in this section to an offence against Part 2 or 2A includes a reference to an offence created by section 6, 7 or 7A or subsection 86(1) of the Crimes Act 1914 that relates to Part 2 or 2A.
8CK Service of summons or process on foreign corporations—criminal proceedings
(1) This section applies to a summons or process in any criminal proceedings under Part 2 or 2A, where:
(a) the summons or process is required to be served on a body corporate incorporated outside Australia; and
(b) the body corporate does not have a registered office or a principal office in Australia; and
(c) the body corporate has an agent in Australia.
(2) Service of the summons or process may be effected by serving it on the agent.
(3) Subsection (2) has effect in addition to section 28A of the Acts Interpretation Act 1901.
Note: Section 28A of the Acts Interpretation Act 1901 deals with the service of documents.
(4) In this section:
criminal proceeding includes a proceeding to determine whether a person should be tried for an offence.
An offence against Part 2 or Division 4 or 6 of Part 2A is an indictable offence.
Part 2C—Re-affirmation of universal service obligation
8CM Re-affirmation of universal service obligation
(1) The Parliament re-affirms its intention:
(a) that all people in Australia, wherever they reside or carry on business, will continue to have reasonable access, on an equitable basis, to standard telephone services and payphones; and
(b) that the universal service obligation described in section 288 of the Telecommunications Act 1991 should be fulfilled as efficiently and economically as practicable; and
(c) that the losses that result from supplying loss-making services in the course of fulfilling the universal service obligation should be shared among carriers on an equitable basis, namely, in direct proportion to each carrier’s share of the interconnect time between those carriers’ trunk and international networks and all local access networks; and
(d) that the information on the basis of which, and the methods by which, those losses and those carriers’ respective shares in those losses are determined should be open to scrutiny by those carriers, and by the public, to the greatest extent possible without undue damage to a carrier’s interests being caused by the disclosure of confidential commercial information.
(2) Part 13 of the Telecommunications Act 1991 provides accordingly for the assessment, collection, recovery and distribution of the levy imposed by the Telecommunications (Universal Service Levy) Act 1991.
(3) An expression used in this section and in Part 13 of the Telecommunications Act 1991 has the same meaning in this section as it has in that Part.
25 Subsection 41(1)
After “this Act”, insert “(other than Part 2, 2A, 2B or 2C)”.
26 After section 42
Insert:
Schedule—Ownership definitions
The object of this Schedule is to define terms used in Part 2A (which deals with ownership restrictions).
In Part 2A and this Schedule, unless the contrary intention appears:
acquisition includes an agreement to acquire, but does not include:
(a) an acquisition by will or by devolution by operation of law; or
(b) an acquisition by way of enforcement of a loan security.
aggregate substantial interest, in relation to a trust estate, has the meaning given by clause 13.
agreement means any agreement, whether formal or informal and whether express or implied.
arrangement has the meaning given by clause 4.
associate has the meaning given by clause 5.
company means a body corporate.
constituent document, in relation to a company, means:
(a) the memorandum and articles of association of the company; or
(b) any rules or other documents constituting the company or governing its activities.
direct control interest has the meaning given by clause 12.
director includes any person occupying the position of director of a company, by whatever name called.
discretionary trust means a trust where:
(a) a person (who may include the trustee) is empowered (either unconditionally or on the fulfilment of a condition) to exercise any power of appointment or other discretion; and
(b) the exercise of the power or discretion, or the failure to exercise the power or discretion, has the effect of determining, to any extent, either or both of the following:
(i) the identities of those who may benefit under the trust;
(ii) how beneficiaries are to benefit, as between themselves, under the trust.
foreign citizen means an individual who is not an Australian citizen.
foreign company means a company incorporated outside Australia.
foreign person means:
(a) a foreign citizen not ordinarily resident in Australia; or
(b) a company where:
(i) a foreign citizen not ordinarily resident in Australia; or
(ii) a foreign company;
holds a particular type of stake in the company of more than 15%; or
(c) a company where a group of 2 or more persons, each of whom is either:
(i) a foreign citizen not ordinarily resident in Australia; or
(ii) a foreign company;
holds, in total, a particular type of stake in the company of more than 40%; or
(d) the trustee of a trust estate in which a foreign citizen not ordinarily resident in Australia or a foreign company holds a substantial interest; or
(e) the trustee of a trust estate in which 2 or more persons, each of whom is either a foreign citizen not ordinarily resident in Australia or a foreign company, hold an aggregate substantial interest.
group includes:
(a) one person alone; or
(b) a number of persons, even if they are not in any way associated with each other or acting together.
increase, in relation to a stake in a company, includes an increase from a starting point of nil.
interest in a share has the meaning given by clause 8.
lending money includes providing non-equity finance where the provision of the finance may reasonably be regarded as equivalent to lending money.
loan security means a security held solely for the purposes of a moneylending agreement.
moneylending agreement means an agreement entered into in good faith in the ordinary course of carrying on a business of lending money, but does not include an agreement dealing with any matter unrelated to the carrying on of that business.
officer, in relation to a company, includes:
(a) a director, secretary or employee of the company; or
(b) a receiver and manager of any part of the undertaking of the company appointed under a power contained in any instrument; or
(c) a liquidator of the company appointed in a voluntary winding‑up.
ordinarily resident in Australia has the meaning given by clause 3.
ownership provisions means Part 2A and this Schedule.
power to appoint a director of a company has a meaning affected by clause 6.
relative, in relation to a person, means:
(a) the person’s spouse; or
(b) another person who, although not legally married to the person, lives with the person on a bona fide domestic basis as the husband or wife of the person; or
(c) a parent or remoter lineal ancestor of the person; or
(d) a son, daughter or remoter issue of the person; or
(e) a brother or sister of the person.
scheme means:
(a) any agreement, arrangement, understanding, promise or undertaking, whether express or implied and whether or not enforceable, or intended to be enforceable, by legal proceedings; and
(b) any scheme, plan, proposal, action, course of action or course of conduct, whether unilateral or otherwise.
share, in relation to a company, means a share in the share capital of the company, and includes:
(a) stock into which any or all of the share capital of the company has been converted; or
(b) an interest in such a share or in such stock.
stake, in relation to a company, has the meaning given by clause 11.
substantial interest, in relation to a trust estate, has the meaning given by clause 13.
sub-underwriter, in relation to an issue of shares, means a person who is a party to an agreement with an underwriter that obliges the first-mentioned person to subscribe for any of the shares in circumstances specified in the agreement.
underwriter, in relation to an issue of shares, means a person who is a party to an agreement with the company issuing the shares that includes a provision obliging the person to subscribe for any of the shares in the event of a shortfall in public subscriptions below an amount specified in the agreement.
voting power has the meaning given by clause 10.
3 When foreign citizens are ordinarily resident in Australia
For the purposes of the ownership provisions, a foreign citizen is ordinarily resident in Australia at a particular time if, and only if:
(a) the foreign citizen has been in Australia during 200 or more days in the period of 12 months immediately preceding that time; and
(b) at that time, one of the following subparagraphs applies:
(i) the foreign citizen is in Australia and has permission to remain in Australia indefinitely;
(ii) the individual is not in Australia but has a right to re‑enter Australia and, on re-entry, to be granted permission to remain in Australia indefinitely;
(iii) the individual is in Australia, is a New Zealand citizen, holds a New Zealand passport and has a special category visa under section 32 of the Migration Act 1958;
(iv) the individual is not in Australia, is a New Zealand citizen, holds a New Zealand passport and, on re-entry to Australia, would have the right to be granted a special category visa under section 32 of the Migration Act 1958.
4 Entering into an agreement or arrangement
(1) For the purposes of the ownership provisions, a person is taken to have proposed to enter into an agreement or arrangement if the person takes part in, or proposes to take part in, negotiations with a view to entering into the agreement or arrangement.
(2) A reference in the ownership provisions to entering into an agreement or arrangement includes a reference to altering or varying an agreement or arrangement.
(3) A reference in the ownership provisions to entering into an arrangement is a reference to entering into any formal or informal scheme, arrangement or understanding, whether expressly or by implication and, without limiting the generality of the foregoing, includes a reference to:
(a) entering into an agreement; or
(b) creating a trust, whether express or implied; or
(c) entering into a transaction;
and a reference in the ownership provisions to an arrangement is to be construed accordingly.
(4) A reference in the ownership provisions to an arrangement does not include a reference to a moneylending agreement.
(1) For the purposes of the ownership provisions, the following persons are associates of a person:
(a) a relative of the person;
(b) a partner of the person;
(c) a company of which the person is an officer;
(d) if the person is a company—an officer of the company;
(e) an employee or employer of the person;
(f) an officer of a company of which the person is an officer;
(g) an employee of an individual of whom the person is an employee;
(h) the trustee of a discretionary trust where the person or another person who is an associate of the person by virtue of another paragraph of this subclause benefits, or is capable (whether by the exercise of a power of appointment or otherwise) of benefiting, under the trust, either directly or through any interposed companies, partnerships or trusts;
(i) a company whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the person;
(j) a company where the person is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the company;
(k) a company in which the person has, apart from this paragraph, a particular type of stake of not less than 15%;
(l) if the person is a company—a person who holds, apart from this paragraph, a particular type of stake in the company of not less than 15%;
(m) a person who is, because of this subclause, an associate of any other person who is an associate of the person (including a person who is an associate of the person by any other application or applications of this paragraph).
(2) If a person (the first person) enters, or proposes to enter, into an arrangement with another person (the second person) that relates to any of the following matters:
(a) the first person and the second person being in a position, by acting together, to control any of the voting power in a company;
(b) the power of the first person and the second person, by acting together, to appoint or remove a director of a company;
(c) the situation where one or more of the directors of a company are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the first person and the second person acting together;
then, the second person is taken to be an associate of the first person for the purposes of the application of a provision of the ownership provisions in relation to the matter concerned.
(1) A reference in the ownership provisions to a power to appoint a director includes a reference to such a power whether exercisable with or without the consent or concurrence of any other person.
(2) For the purposes of the ownership provisions, a person is taken to have the power to appoint a director if:
(a) the person has the power (whether exercisable with or without the consent or concurrence of any other person) to veto such an appointment; or
(b) a person’s appointment as a director of the company follows necessarily from that person being a director or other officer of the first-mentioned person.
7 Meaning of entitled to acquire
For the purposes of the ownership provisions, a person is entitled to acquire any thing if the person is absolutely or contingently entitled to acquire it, whether because of any constituent document of a company, the exercise of any right or option or for any other reason.
8 Meaning of interest in a share
(1) Subject to this clause, for the purposes of the ownership provisions, a person holds an interest in a share if the person has any legal or equitable interest in the share.
(2) For the purposes of the ownership provisions, a person is taken to hold an interest in a share if:
(a) the person has entered into a contract to purchase the share; or
(b) the person has a right (otherwise than because of having an interest under a trust) to have the share transferred to the person or to the person’s order (whether the right is exercisable presently or in the future and whether or not on the fulfilment of a condition); or
(c) the person has a right to acquire the share, or an interest in the share, under an option (whether the right is exercisable presently or in the future and whether or not on the fulfilment of a condition); or
(d) the person is otherwise entitled to acquire the share or an interest in the share; or
(e) the person is entitled (otherwise than because of having been appointed as a proxy or representative to vote at a meeting of members of the company or of a class of its members) to exercise or control the exercise of a right attached to the share.
(3) Subclause (2) does not, by implication, limit subclause (1).
(4) A person is taken to hold an interest in a share even if the person holds the interest in the share jointly with another person.
(5) For the purpose of determining whether a person holds an interest in a share, it is immaterial that the interest cannot be related to a particular share.
(6) An interest in a share is not to be disregarded only because of:
(a) its remoteness; or
(b) the manner in which it arose; or
(c) the fact that the exercise of a right conferred by the interest is, or is capable of being made, subject to restraint or restriction.
9 Certain interests in shares to be disregarded
(1) For the purposes of the ownership provisions, the following interests must be disregarded:
(a) an interest in a share in Telstra held by the sale-scheme trustee in accordance with the sale-scheme trust deed;
(b) an interest in a share held by a person whose ordinary business includes the lending of money if the person holds the interest as a loan security;
(c) an interest in a share held by a person, being an interest held by the person because the person holds a prescribed office;
(d) an interest of a prescribed kind in a share, being an interest held by such persons as are prescribed.
(2) For the purposes of the ownership provisions, if:
(a) a person holds an interest in a share as a loan security; and
(b) the ordinary business of the person includes the lending of money; and
(c) the loan security is enforced; and
(d) as a result of the enforcement of the loan security, the person becomes the holder of the share; and
(e) the person holds the share for a continuous period (the holding period) beginning at the time when the security was enforced;
the person’s interest in the share must be disregarded at all times during so much of the holding period as occurs during whichever of the following periods is applicable:
(f) the period of 90 days beginning when the security was enforced;
(g) if the Minister, by written notice given to the person, allows a longer period—the end of that longer period.
(3) For the purposes of the ownership provisions, if:
(a) a person acquires an interest in a share in Telstra; and
(b) the interest was acquired in the person’s capacity as an underwriter or a sub-underwriter in relation to an issue of shares in Telstra under a Telstra sale scheme;
the person’s interest in the share must be disregarded at all times during whichever of the following periods is applicable:
(c) the period of 90 days beginning when the person acquired the interest;
(d) if the Minister, by written notice given to the person, allows a longer period—that longer period.
(1) A reference in the ownership provisions to the voting power in a company is a reference to the total rights of shareholders to vote, or participate in any decision-making, concerning any of the following:
(a) the making of distributions of capital or profits of the company to its shareholders;
(b) the constituent document of the company;
(c) any variation of the share capital of the company.
(2) A reference in the ownership provisions to control of the voting power in a company is a reference to control that is direct or indirect, including control that is exercisable as a result of or by means of arrangements or practices:
(a) whether or not having legal or equitable force; and
(b) whether or not based on legal or equitable rights.
(3) If the percentage of total rights to vote or participate in decision‑making differs as between different types of voting or decision‑making, the highest of those percentages applies for the purposes of this clause.
(4) If a company:
(a) is limited both by shares and by guarantee; or
(b) does not have a share capital;
this clause has effect as if the members or policy holders of the company were shareholders in the company.
(1) A particular type of stake that a person holds in a company at a particular time is the aggregate of:
(a) the direct control interests in the company of that type that the person holds at that time; and
(b) the direct control interests in the company of that type held at that time by associates of the person.
(2) In calculating the stake that a person holds in a company, a direct control interest held because of subclause 12(5) is not to be counted under paragraph (1)(a) to the extent to which it is calculated by reference to a direct control interest in the company that is taken into account under paragraph (1)(b).
(3) For the purpose of calculating the total of the stakes of a particular type that a group of persons holds in a company, if a particular stake that a person holds in a company would be counted more than once because the person is an associate of one or more other persons in the group, that interest is to be counted only once.
12 Direct control interests in a company
(1) A person holds a direct control interest in a company at a particular time equal to the percentage of the total paid-up share capital of the company in which the person holds an interest at that time.
(2) A person also holds a direct control interest in a company at a particular time equal to the percentage of the voting power in the company that the person is in a position to control at that time.
(3) A person also holds a direct control interest in a company at a particular time equal to the percentage that the person holds, or is entitled to acquire, at that time of the total rights to distributions of capital or profits of the company to its shareholders on winding‑up.
(4) A person also holds a direct control interest in a company at a particular time equal to the percentage that the person holds, or is entitled to acquire, at that time of the total rights to distributions of capital or profits of the company to its shareholders, otherwise than on winding-up.
(5) If:
(a) a person holds a particular type of direct control interest (including a direct control interest that is taken to be held because of one or more previous applications of this subclause) in a company (the first level company); and
(b) the first level company holds the same type of direct control interest in another company (the second level company);
the person is taken to hold that type of direct control interest in the second level company equal to the percentage worked out using the formula:
where:
first level percentage means the percentage of the direct control interest held by the person in the first level company.
second level percentage means the percentage of the direct control interest held by the first level company in the second level company.
13 Substantial interests in trust estates
(1) For the purposes of the ownership provisions:
(a) a person is taken to hold a substantial interest in a trust estate if the person, alone or together with an associate or associates, holds a beneficial interest in not less than 15% of the corpus or income of the trust estate; and
(b) 2 or more persons are taken to hold an aggregate substantial interest in a trust estate if the persons, together with an associate or associates, hold, in the aggregate, beneficial interests in not less than 40% of the corpus or income of the trust estate.
(2) For the purposes of subclause (1), if, under the terms of a trust, a trustee has a power or discretion as to the distribution of the income or corpus of the trust estate to beneficiaries, each beneficiary is taken to hold a beneficial interest in the maximum percentage of income or corpus of the trust estate that the trustee is empowered to distribute to that beneficiary.
[Minister’s second reading speech made in—
House of Representatives on 2 May 1996
Senate on 9 May 1996]
I HEREBY CERTIFY that the above is a fair print of the Telstra (Dilution of Public Ownership) Bill 1996 which originated in the House of Representatives and has been finally passed by the Senate and the House of Representatives.
Clerk of the House of Representatives
IN THE NAME OF HER MAJESTY, I assent to this Act.
Governor-General
December 1996
(15/96)