Document ID: chunk:federal_register_of_legislation:F2024L00884:body:0:p47
Version: federal_register_of_legislation:F2024L00884
Segment Type: other
Provision Reference: 
Character Range: 121215–123919

the life company must not otherwise do anything to create an expectation that the call will be exercised.
[26]  An instrument may not provide for investors upon non-payment of a distribution to convert an Additional Tier 1 Capital instrument, and the amount of any unpaid dividend or interest, into ordinary shares or mutual equity interests.
[27]  If an overseas branch of a life company in a foreign jurisdiction where insolvency law is different from the jurisdiction where the parent entity is based, issue documentation must specify that the insolvency law in the parent's jurisdiction will apply.
[28]  This does not preclude a parent entity of the life company from holding the instrument where the instrument is directly issued by the life company to the parent entity.
[29]  Indirect exposures represent exposures that will result in a loss to the life company substantially equivalent to any loss in the direct holding.
[30]  For example, by way of a scheme of arrangement.
[31]  No restrictions on payment of distributions, or any restrictions on redemptions or buyback of Common Equity Tier 1 Capital instruments may be applied to: i) any existing holding company of the issuer or ii) any potential future holding company of the issuer, where the holding company does not undertake the role of the issuer of the instrument. This includes situations where a future holding company may be substituted as the issuer of ordinary shares on conversion, but not substituted as the issuer of the instrument.
[32]  Any reference to Common Equity Tier 1 Capital instruments in this paragraph includes a reference to mutual equity interests issued in accordance with Attachment G.
[33]  Conversion must be into the ordinary shares of the life company or its parent entity, which must be listed at the time of issue. For an unlisted life company with no listed upstream entity at the time the instrument is issued, the instrument is to be converted into unlisted ordinary shares of the life company. Where an unlisted life company issues the instrument to its listed parent entity, conversion may be into unlisted ordinary shares of the life company.
[34]  Reference to life company captures any entity whose ordinary shares are issued as a result of conversion provisions.
[35]  For an unlisted life company that has no listed parent entity at the time of issue, the ordinary share price is based on the book value per share at the time of issue.
[36]  For example, by way of a scheme of arrangement.
[37]  Where an instrument has a defined maturity and provides for a mandatory roll-over the maturity of the instrument is deemed to only extend to the date upon which any roll-over may take effect.
[38]