Foreign arrangements that are legally binding under Australian law
41 Foreign arrangements that are legally binding under Australian law
When Minister may make declaration
The Minister may make a declaration under subsection (2) or (3) in relation to an arrangement between a State/Territory entity and a foreign entity if:
subsection 40(1) is satisfied in relation to the arrangement; and
apart from the declaration, the arrangement would be legally binding under an Australian law.
The Minister must take into account certain matters when making a decision to make a declaration under subsection (2) or (3) (see section 51).
Section 44 deals with general matters about the declaration (such as revocation and giving notice to the State/Territory entity).
Declaration that arrangement is invalid and unenforceable
The Minister may make a written declaration that:
the arrangement:
is invalid and unenforceable to the specified extent and from the specified day; or
if the arrangement was entered in contravention of subsection 36(3)—is, and is taken to have always been, invalid and unenforceable to the specified extent; and
the State/Territory entity must, within the specified period, notify the foreign entity that:
a declaration is in force under this subsection in relation to the arrangement; and
the arrangement is invalid and unenforceable, to the specified extent;
and give the foreign entity a copy of the declaration; and
the State/Territory entity must, as soon as practicable after complying with paragraph (b), notify the Minister, in writing, of its compliance with that paragraph; and
the State/Territory entity must not, to the specified extent and from the specified day:
give effect to the arrangement; or
hold out, or conduct itself on the basis, that it can give effect to the arrangement; or
hold out, or conduct itself on the basis, that the arrangement is valid or enforceable; and
the foreign entity must not, to the specified extent and from the specified day:
give effect to the arrangement in Australia; or
hold out in Australia, or conduct itself in Australia on the basis, that it can give effect to the arrangement; or
hold out in Australia, or conduct itself in Australia on the basis, that the arrangement is valid or enforceable.
The declaration in relation to paragraph (a) has effect accordingly.
Declaration requiring variation or termination of arrangement
The Minister may make a written declaration that:
the State/Territory entity must, within the specified period, notify the foreign entity that:
a declaration is in force under this subsection in relation to the arrangement; and
the arrangement is required to be varied or terminated in accordance with any specified requirements;
and give the foreign entity a copy of the declaration; and
the State/Territory entity must, in accordance with any specified requirements, vary or terminate the arrangement; and
the State/Territory entity must, as soon as practicable after complying with paragraph (a) or (b), notify the Minister, in writing, of its compliance with that paragraph; and
the State/Territory entity must not, to the specified extent and from the specified day:
give effect to the arrangement; or
hold out, or conduct itself on the basis, that it can give effect to the arrangement; and
the foreign entity must not, to the specified extent and from the specified day:
give effect to the arrangement in Australia; or
hold out in Australia, or conduct itself in Australia on the basis, that it can give effect to the arrangement.
Compliance with declaration
The State/Territory entity must comply with the declaration to the extent that it applies to the entity.
The foreign entity must comply with the declaration:
if it has been a given a copy of the declaration as required by paragraph (2)(b) or (3)(a); and
to the extent that the declaration applies to the entity.
Matters relating to declaration
For the purposes of paragraph (3)(b), the declaration may require that the arrangement be varied or terminated:
in accordance with the Australian law; or
in accordance with any other requirements; or
in accordance with both the Australian law and other requirements.
A declaration made under subsection (2) or (3) is not a legislative instrument.
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