Chapter 5
Fundraising
Outline of chapter
5.1 This Bill contains six measures amending a number of provisions in
the Corporations Act relating to fundraisings by corporate entities. The
amendments are generally intended to facilitate fundraising by providing
relief from unnecessary regulatory requirements such as the need, in
some circumstances, to provide a disclosure document, removing
unnecessary inconsistencies between different parts of the Corporations
Act, or relaxing certain unnecessary restrictions (for example, time
periods and amounts that can be raised under particular provisions).
Context of amendments
General background
5.2 The measures in this chapter relate to the fundraising provisions in
the Corporations Act (mainly Chapter 6D, but also some parts of
Part 7.9). Chapter 6D was inserted in the Corporations Act by the
Corporate Law Economic Reform Program Act 1999. It builds on the
previous general prospectus disclosure rules, but includes a number of
additional provisions relating to the use of new instruments such as short
form prospectuses and offer information statements, clarification of the
persons liable for contraventions of the provisions and a new definition of
sophisticated investors.
5.3 The introduction of the Government's new regime for the regulation
of financial services in Chapter 7 of the Corporations Act occurred in
2001 through the Financial Services Reform Act 2001. One of the
elements of this Act was that interests in managed investment schemes
were taken out of the Chapter 6D fundraising regime and placed under a
new disclosure regime in Part 7.9 of the Corporations Act. The Part 7.9
regime targets certain investment products marketed mainly to small...