Document ID: chunk:federal_register_of_legislation:C2004A04501:schedule:3:p10
Version: federal_register_of_legislation:C2004A04501
Segment Type: schedule
Provision Reference: sch 3 (pt 10/16)
Character Range: 138331–140960

the case may be, to make the contract; and

  (b)     the resolution was passed at a general meeting of the public

     company held within 15 months before the contract was made; and

     (c) the conditions prescribed by Subdivision B have been satisfied in relation to the resolution.

"(2) A reference in this Division to a resolution or proposed resolution permitting a financial benefit to be given by a public company or entity includes a reference to the resolution or proposed resolution permitting the public company or entity to make a contract to give the benefit.

Resolution may specify matters by class or kind

"243S. A resolution under this Division may specify anything either in particular or by reference to class or kind.

Effect of resolution

"243T.(1) A resolution of a public company that permits the company to give a financial benefit to a related party does not affect the application of subsection 243H(2) and this Division to the public company in its capacity as a child entity of another public company.

"(2) A resolution of a public company that permits a child entity of the public company to give a financial benefit to a related party of the public company does not affect:

     (a)     if the child entity is also a public company—the application of subsection 243H(1) and this Division to the child entity in its capacity as a public company; or

     (b)     in any case—the application of subsection 243H(2) and this Division to the child entity in its capacity as a child entity of another public company.

     Example: A Ltd, B Ltd and C Ltd are all public companies. X is a director of A Ltd. A Ltd is a holding company of B Ltd, which is a holding company of C Ltd.
     For C Ltd to give to X a financial benefit not covered by an exception in Division 4, all 3 companies must pass resolutions under this Division permitting the benefit.
     This is because 3 applications of section 243H prohibit C Ltd from giving the benefit. Subsection 243H(1) prohibits C Ltd as a public company of which X is a related party. Subsection 243H(2) prohibits C Ltd twice: once as a child entity of B Ltd, of which X is a related party, and once as a child entity of A Ltd, of which X is also a related party.

Subdivision B—Conditions to be satisfied

Company must lodge material that will be put to members

"243U.(1) At least 14 days before the notice convening the relevant meeting is given, the public company must lodge:

     (a)     a proposed notice of meeting setting out the text of the proposed resolution; and

  (b)     a proposed explanatory statement satisfying section 243V;