Changing the constitution-hardship withdrawals
8A Changing the constitution-hardship withdrawals
Chapter 5C of the Act applies to a responsible entity of a registered time-sharing scheme as if Part 5C.3 were modified or varied by:
before subsection 601GC(2) inserting:
"(1B) The constitution of a registered time-sharing scheme (as defined in ASIC Corporations (Time-sharing Schemes) Instrument 2017/272) may also be modified, or repealed and replaced with a new constitution, by the responsible entity in accordance with section 601GCD."; and
inserting the following section in its relative order in Part 5C.3:
"601GCD Changing the constitution of a registered time-sharing scheme to enable hardship withdrawals
Subject to subsection (2), the responsible entity of a registered time-sharing scheme (as defined in ASIC Corporations (Time-sharing Schemes) Instrument 2017/272) may modify the constitution of the scheme to:
include provisions to the effect of paragraphs 601GA(1A)(a) to (l) (as notionally inserted, or to be notionally inserted, as a result of ASIC Corporations (Amendment) Instrument 2020/1064); and
make any other modifications that the responsible entity reasonably considers are necessary for, or incidental to, the responsible entity including provisions to the effect of paragraphs 601GA(1A)(a) to (l).
The responsible entity may modify the constitution under subsection (1) where:
the responsible entity has given members of the scheme written notice of the modification by sending each member by post or by email a copy of a notice that complies with subsection (3); and
the responsible entity has published a notice that complies with subsection (3) on its website:
no later than the date it gives written notice under paragraph (a); and in a way that is likely to come to the attention of a person looking for information about the scheme on the website; and
as at a date (relevant date) that is:
no later than the date it gives written notice under paragraph (a) and (b); and
at least 14 days after the responsible entity gives notice to members under paragraph (a);
the responsible entity has not received requests from members with at least 5% of the votes that may be cast on the resolution referred to in paragraph (3)(b) to call and arrange to hold a meeting as specified in the notice.
A notice complies with this subsection if it:
sets out a summary of the reason for, and the effect of, the proposed modification of the constitution; and states that the responsible entity will modify the constitution as proposed unless it receives requests to call and arrange to hold a meeting of the scheme's members to consider and vote on a special resolution to modify the constitution as proposed:
from members with at least 5% of the votes that may be cast on the resolution; and by the relevant date; and states that a request referred to in paragraph (b) must be made in writing and may be sent to a specified email address of the responsible entity; and is worded and presented in a clear, concise and effective manner.
Unless the scheme's constitution provides otherwise, a notice sent by post is taken to be given 3 days after it is posted. A notice sent by email is taken to be given on the business day after it is sent.
The responsible entity may repeal and replace the constitution instead of modifying it where:
the replacement constitution has the effect that the constitution would have had if it had instead been modified in accordance with subsection (1); and subsection (2) had been satisfied as if references in subsections (2) and (3) to modifying the constitution included references to repealing and replacing it.
The responsible entity may modify or repeal and replace the constitution under subsections (1) and (5) even if the constitution includes provisions to the effect that it may only be modified or repealed and replaced in accordance with paragraphs 601GC(1)(a) or (b) or provisions to the effect of those paragraphs.
If the responsible entity:
decides not to give members written notice (modification notice) under paragraph (2)(a) or under subsection (5) as it applies in relation to paragraph (2)(a); or
does not give members a modification notice by 30 September 2021;
the responsible entity must give each member by post or by email written notice that complies with subsection (8) by no later than:
if paragraph (a) applies-21 days after making the decision; and
if paragraph (b) applies-21 October 2021.
A notice complies with this subsection if it includes an explanation of the following:
why the responsible entity has decided not to give, or has not given, members a modification notice; and
the effect for members of the responsible entity not giving members a modification notice compared to the situation if the responsible entity had given a modification notice; and
that under section 252D, members holding interests carrying at least 5% of the votes that may be cast at a meeting of scheme may call and arrange to hold a meeting of the scheme's members to consider and vote on a special resolution to modify or repeal and replace the constitution the constitution to include provisions to the effect of paragraphs 601GA(1A)(a) to (l) at the expense of those members.
The responsible entity must act in the best interests of the members in exercising the power in subsections (1) and (5) to modify, or repeal and replace the constitution: see paragraph 601FC(1)(c).".
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