What it does
Mechanically, the Act creates a statutory framework by which the New South Wales Government may sell the business undertaking of Freight Rail Corporation (FreightCorp). It does three things in sequence. First, it prescribes three mutually available sale methods and limits who may be the purchaser (Part 2, s 5). Second, it confers broad powers on the Treasurer and on FreightCorp to prepare for and to effect that sale, including powers to negotiate, to enter into sale contracts, to make written orders transferring assets, rights and liabilities, and to convert FreightCorp into a company or to create a sale company for the purpose of sale (Parts 3-5, ss 6, 7, 11, 12, 16-18, 22, 32-34). Third, it prescribes the legal consequences of transfers and conversions for employees, property registrations, taxes, superannuation arrangements and post-sale corporate status (Part 6, ss 42-45; Schedules 1 and 2).
The Act defines the scope of what is transferable by reference to the “business undertaking of FreightCorp” and allows the Treasurer by written order to designate particular assets, rights or liabilities as excluded from sale (s 3 definitions; s 9). For excluded items the Treasurer may transfer them to the Crown or to the Ministerial Holding Corporation (s 9(2)). The Act also creates the mechanism for transfer by order, including immediate vesting on the transferee without conveyance, deemed continuation of proceedings, and certification processes for registration authorities (Schedule 1, cls 3, 8-10). Special treatment is given to “special leases”: they remain vested in FreightCorp, cannot be transferred, but subleases may be granted by the Treasurer for the purchaser’s use on such terms as the Treasurer determines (ss 14, 35).
The Act limits purchasers. FreightCorp’s purchaser can only be National Rail Corporation Limited, a purchaser of its shares, or a related body corporate of such a purchaser (s 5(2)). Where conversion to a company occurs, the Act takes the sale company to be a legal continuation of FreightCorp (s 19(1)) and provides that, until shares are transferred, they are held for and on behalf of the State (s 18). The Treasurer is expressly authorised to act for and on behalf of FreightCorp to enter sale agreements (s 11(1)) and may direct FreightCorp’s conduct for the purpose of facilitating the sale (s 7).