Pooled Development Funds
Amendment Act 1994

No. 102 of 1994

An Act to amend the Pooled Development Funds Act 1992,
and for related purposes

[Assented to 30 June 1994]

The Parliament of Australia enacts:

PART 1—PRELIMINARY

Short title etc.

1.(1) This Act may be cited as the Pooled Development Funds Amendment Act 1994.

(2)  In this Act, “Principal Act” means the Pooled Development Funds Act 1992¹.

Commencement

2.  This Act commences on 1 July 1994.

PART 2—AMENDMENTS RELATING TO THE ASSETS OF INVESTEE COMPANIES

Object of Part

3.  The object of this Part is to increase the limit on the assets of an investee company from $30 million to $50 million.

Limit on size of investee company

4.  Section 24 of the Principal Act is amended by omitting from subsections (1), (2) and (7) “$30 million” and substituting “$50 million”.

PART 3—AMENDMENTS RELATING TO THE MAXIMUM LEVEL OF INVESTMENT IN AN INVESTEE COMPANY

Objects of Part

5.  The objects of this Part are:

(a)  to increase the maximum level of investment in an investee company from 20% to 30% of a PDF’s committed capital; and

(b)  to give the PDF Registration Board a discretion to allow a PDF to exceed that maximum level.

Interpretation

6.  Section 4 of the Principal Act is amended by omitting “or 24(2)” from paragraph (c) of the definition of “reviewable decision” in subsection (1) and substituting “, 24(2) or 25(1)”.

PDF not to commit more than 30% of its committed capital to investee company

7.  Section 25 of the Principal Act is amended:

(a)   by omitting “The investment” and substituting “Unless the Board otherwise approves, the investment”;

(b)  by omitting “20%” and substituting “30%”;

(c)   by adding at the end the following subsections:

“(2)  The Board must not give an approval under subsection (1) if the Board is satisfied that the investment is connected with a scheme or proposed scheme to which Part IVA of the Income Tax Assessment Act 1936 applies or would apply, as the case requires.

“(3) An expression used in subsection (2) of this section and in Part IVA of the Income Tax Assessment Act 1936 has the same meaning in that subsection as it has in that Part.”.

Provisions relating to approvals by Board

8.  Section 28 of the Principal Act is amended:

(a)  by inserting after subsection (2) the following subsections:

“(2A) An approval for the purposes of subsection 25(1) must be given subject to a condition that, at the end of a specified period, the total of:

(a)  all amounts paid on the shares in the investee company held by the PDF; and

(b)  all amounts remaining unpaid on those shares;

must not exceed 30% of the total of:

(c)   the shareholders’ funds of the PDF; and

(d)  all amounts remaining unpaid on the issued shares in the PDF.

“(2B) If:

(a)  an approval is given for the purposes of subsection 25(1); and

(b)  the PDF makes the investment;

the PDF must comply with the condition covered by subsection (2A).”;

(b)  by inserting after paragraph (d) of the definition of “approval provision” in subsection (3) the following paragraph:

“(da) subsection 25(1); or”.

Revocation at discretion of Board

9.  Section 47 of the Principal Act is amended by inserting after paragraph (a) of the definition of “revocation provision” in subsection (4) the following paragraph:

“(aa) subsection 28(2B); or”.

Criminal consequences of contravening certain provisions

10.  Section 50 of the Principal Act is amended by inserting in the table in subsection (1) the following item (immediately after the item relating to section 19):

“Subsection 28(2B)                             $50,000”.

PART 4—AMENDMENTS RELATING TO INVESTMENT IN STARTUP BUSINESSES

Object of Part

11.  The object of this Part is to remove the restriction on a PDF investing in start-up businesses.

Interpretation

12.  Section 4 of the Principal Act is amended by omitting “, or under subsection 26(3) to refuse to make a declaration,” from paragraph (c) of the definition of “reviewable decision” in subsection (1).

Repeal of section 26

13.  Section 26 of the Principal Act is repealed.

Application

14.  The amendment made by section 12 does not apply to a decision made before the commencement of this section.

PART 5—AMENDMENT RELATING TO THE LIMIT ON SHAREHOLDINGS IN A PDF

Object of Part

15.  The object of this Part is to increase from 20% to 30% the limit on shareholdings in a PDF.

Limit on shareholding in a PDF

16.  Section 31 of the Principal Act is amended by omitting from subsection (1) “20%” and substituting “30%”.

PART 6—AMENDMENTS RELATING TO THE PERCENTAGE OF THE CAPITAL RAISED BY A PDF THAT MUST BE INVESTED

Object of Part

17.  The object of this Part is to increase from 50% to 65% the percentage of the capital raised by a PDF that must, as a general rule, be invested within the timetable set out in section 32 of the Principal Act.

Timetable for investing funds raised by PDF

18.  Section 32 of the Principal Act is amended by omitting “50%” from paragraphs (b) and (c) of the definition of “required percentage” in subsection (1) and substituting “65%”.

NOTE

1.     No. 100, 1992.

[Minister’s second reading speech made in—

Senate on 6 June 1994

House of Representatives on 28 June 1994]