Chapter 3
Provisions of the Bill
Definitions
3.1 'Conversion time' is defined by clause 7 to
mean the date on which Schedule 2 of the Bill
commences. Schedule 2 of the Bill commences on a day
to be fixed by proclamation. If that does not occur within 6
months of Royal Assent of the Bill, then 6 months and 1 day
after Royal Assent.
Registration of Wool International Limited as a public
company
3.2 Clause 8 requires Wool International to
register as soon as possible after the commencing time as a
public company. The application for registration must be
accompanied by a copy of Wool International's proposed
constitution. That constitution must be approved by the
Minister. Wool International will be exempt from certain
requirements under the Corporations Law, namely:
- the application for registration state the name and
address of each member of the company
- the application for registration state the number and
class of shares each member (shareholder) already
holds or has agreed, in writing, to take up
- the application for registration state the amount
each member has already paid or agreed, in writing,
to pay for each share
- the application for registration state the amount
unpaid on each share
- the application for registration will not need to be
in the form prescribed by the ASIC (Australian
Securities and Investments Commission)
- lodgment with the application for registration of a
certified copy of a current certificate of the body's
incorporation in its place of origin, or of a
document that has a similar effect, any other
documents that are prescribed, and any other
documents that the ASIC requires by written notice
given to the body, and
- lodgement with the application for registration of
evidence that under the law of the body's place of
origin that the body's type is the same or
substantially the same as the proposed type specified
in the application, and the members have consented to
the transfer by a resolution that has been passed at
a meeting by at least 75% of the votes cast by
members entitled to vote on the resolution and were
given 21 days notice of the meeting and the proposed
resolution.
Nomination of TrusteeCo to hold shares etc
3.3 Clause 9 provides for the establishment of a
trust company, TrusteeCo, prior to the conversion time.
TrusteeCo must be wholly owned by Wool International. All
units (ie. a unit of equity in Wool International allocated
under the Wool International Act 1993) registered in
the name of the Chief Executive (eg. those belonging to
putative equity holders) will be taken to be registered in
the name of TrusteeCo immediately before the conversion time
(clause 10). In addition, any property held by the
Chief Executive before the conversion time will also transfer
to TrusteeCo at the conversion time.
Share capital
3.4 Clause 13 provides that immediately before the
conversion time Wool International is taken to have a share
capital of $349 403.18 which will be divided into 349 403 180
shares.
Conversion of Wool International into WoolStock Australia
Limited
3.5 At the conversion time the ASIC will be taken to have
registered Wool International as a public company with the
name WoolStock Australia Limited (clause 14).
Shares in Wool International
3.6 Clause 16 deals with the issue of shares in
WoolStock Australia Limited to registered equity holders. At
the conversion time, each registered equity holder will
receive one share in WoolStock Australia Limited for each
unit of equity that they hold. A person to whom shares are
issued becomes a member of WoolStock Australia Limited, and
will have the same rights, privileges, duties, liabilities
and obligations in respect of that membership as if they had
become a share holder under the constitution of WoolStock
Australia Limited.
Charges on shares
3.7 Shares taken to be issued under clause 16 will
be subject to the same charges, if any, as they were subject
to immediately before the conversion time (clause 17).
As noted in the Explanatory Memorandum to the Bill, this is
intended [and will] preserve the value of any security which
has been obtained by chargees over units of equity. WoolStock
Australia Limited must issue separate share certificates for
shares subject to a charge and those not so subject. Chargees
will be entitled to WoolStock Australia Limited dividends
where a WoolStock Australia Limited share is subject to a
charge/s and the registered equity holder has authorised
WoolStock Australia Limited to make such dividend payments up
to the amount of the debt secured by the charge/s.
Dealings by TrusteeCo with unclaimed units or wrong-name
units
3.8 Clause 19 deals with the treatment of unclaimed
units of equity and wrong-name units of equity held by
TrusteeCo. TrusteeCo will hold such shares on trust until
they are transferred to the correct person who is entitled to
be registered in respect of the units. The clause also
provides for dividends from unclaimed and wrong-name units to
be transferred to TrusteeCo, at the finalisation time (ie.
one month after the final distribution of equity units),
where the holders cannot be identified. Where the holders of
such units are identified, before the finalisation time,
TrusteeCo must transfer the shares to the person and pay any
dividends received in respect of the shares.
Capital gains tax
3.9 Clause 20 deals with capital gains tax and the
privatisation of Wool International. The clause provides that
certain events flowing from the Bill's provision will not
attract capital gains tax, including the issue of shares in
WoolStock Australia Limited and the establishment of charges
over shares and the transfer of units of equity and property
to TrusteeCo.
Exemption from income tax
3.10 WoolStock Australia Limited is provided with an
exemption from income tax in respect of amounts derived from
wool stockpile activities (clause 22).
Commonwealth guarantee
3.11 Clause 26 provides for the continuation of
Commonwealth guarantees in respect of WoolStock Australia
Limited debts where:
- the amount payable by WoolStock Australia Limited was
incurred before the conversion time, and
- the obligation to pay the amount has not been varied,
after the conversion time, without the written
consent of the Minister for Finance.
Schedule 2 - Amendments to the Wool International Act
1993
3.12 Item 3 of Schedule 2 substitutes a new
section 3 in the Wool International Act 1993 (the
Principal Act) which provides that the main object of the
Act, from conversion time, is to provide for units of equity
for contributions made to WoolStock Australia Limited from
payments of wool tax.
3.13 The effect of item 16 of Schedule 2 is
to require TrusteeCo to transfer unclaimed units of equity to
the person/s who is entitled to be registered in respect of
such units where the person/s is identified.
3.14 A new section 22MA is inserted in the
Principal Act by item 39 of Schedule 2 which
will allow WoolStock Australia Limited to transfer to the
ASIC for disposal certain units of equity which it has held
for at least 6 years. The conditions precedent for such a
disposal are that WoolStock Australia Limited:
- has reasonable grounds for believing that the equity
holder was not residing at the address shown in the
register as the person's address and
- on each occasion during the six year period, when it
tried to communicate with the equity holder, have
been unable after exercising reasonable diligence to
do so.
3.15 A new section 22P, dealing with the distribution of surplus
money by WoolStock Australia Limited, is inserted in the Principal Act
by item 42 of Schedule 2. The surplus money of WoolStock
Australia Limited is to consist of any money of WoolStock Australia Limited
that in its opinion is not needed to be set aside for its operations.
WoolStock Australia Limited must distribute surplus money by way of either
interim distributions and a final distribution as soon as practicable
after the end of the financial year in which the last stockpile wool is
disposed of. The amount of each distribution is to be determined by WoolStock
Australia Limited.