Part 4The transition period

Part 4—The transition period

24 Modifications of constitution

(1) A company registered under clause 3 must modify its constitution before the end of the transition period so that the constitution:

(a) gives effect to this Schedule; and

(b) is consistent with this Law; and

(c) sets out the rights and obligations attaching to each class of shares on issue, including shares that are taken to have been issued by a provision of this Schedule.

(2) A company registered under clause 3 is not prevented from:

(a) modifying its constitution to change the rights and obligations attaching to any membership shares on issue; or

(b) redeeming any membership shares on issue and not providing for them in the constitution;

merely because 1 or more members of the company are deemed to have been issued with membership shares by clause 12.

25 ASIC may direct directors of a company to modify its constitution

(1) If a company registered under clause 3 has not modified its constitution so that it complies with subclause 24(1) by the end of the transition period, ASIC may direct, in writing, the directors of the company to:

(a) take the necessary or specified steps to:

(i) ensure that the company modifies its constitution so that it does comply; or

(ii) ensure that the company makes the modifications to its constitution that ASIC specifies; and

(b) take those steps within a specified time (which must be more than 28 days).

A direction may require the directors to take steps that are inconsistent with the company’s constitution. (2) ASIC may issue a direction under subclause (1) before the end of the transition period if requested by a majority of directors of the company. (3) No civil or criminal liability arises from action taken by a director in good faith and in accordance with a direction issued under subclause (1). (4) A person contravenes this subclause if, without reasonable excuse, they contravene a direction under subclause (1). (5) A person who intentionally or recklessly contravenes a direction under subclause (1) is guilty of an offence.

Penalty: 100 penalty units or imprisonment for 2 years, or both.

26 ASIC’s power to make exemption and modification orders for the transition period

(1) ASIC may:

(a) exempt a company registered under clause 3 from a provision of this Law; or

(b) declare that this Law applies to a person as if specified provisions were omitted, modified or varied as specified in the declaration.

The exemption or declaration ceases to have effect at the end of the transition period (the 18 months starting on the transfer date), unless ASIC specifies a shorter period in which it ceases to have effect. (2) Without limiting subclause (1), the exemption or declaration may relate to: