Commonwealth of Australia Bills Commonwealth of Australia Bills[Index] [Search] [Download] [Related Items] [Help]
This is a Bill, not an Act. For current law, see the Acts databases.
2002
The
Parliament of the
Commonwealth of
Australia
HOUSE OF
REPRESENTATIVES
Presented and read a first
time
Venture
Capital Bill 2002
No. ,
2002
(Treasury)
A Bill
for an Act relating to venture capital investments, and for related
purposes
Contents
A Bill for an Act relating to venture capital
investments, and for related purposes
The Parliament of Australia enacts:
Table of sections
1-1 Short title
1-5 Commencement
1-10 Interpretation
1-15 Identifying defined terms
This Act may be cited as the Venture Capital Act 2002.
This Act commences on the day on which it receives the Royal
Assent.
(1) An expression has the same meaning in this Act as in the Income Tax
Assessment Act 1997.
(2) Division 950 of the Income Tax Assessment Act 1997 (which
contains rules for interpreting that Act) applies to this Act as if the
provisions of this Act were provisions of the Income Tax Assessment Act
1997.
(1) Many of the terms in this Act are defined in the Dictionary, starting
at section 995-1, to the Income Tax Assessment Act 1997.
(2) Most of the terms that are defined in that Dictionary are identified
by an asterisk appearing at the start of the term: as in
*PDF Board. The footnote with the asterisk
contains a signpost to that Dictionary.
(3) An asterisk usually identifies the first occurrence of a term in a
section (if not divided into subsections), subsection or definition. Later
occurrences of the term in the same provision are not usually
asterisked.
(4) Terms are not asterisked in headings, notes, examples, explanatory
tables, guides, outline provisions or diagrams.
(5) If a term is not identified by an asterisk, disregard that fact in
deciding whether or not to apply to that term a definition or other
interpretation provision.
This Act provides for some administrative measures that are needed for
the operation of:
(a) the capital gains tax exemption relating to venture capital under
Subdivision 118-F of the Income Tax Assessment Act 1997 (and the
related provisions about similar income gains and losses); and
(b) the “flow-through” treatment, under Division 5 of
Part III of the Income Tax Assessment Act 1936, of the income of
limited partnerships that are used as vehicles for making venture capital
investments.
Note: The PDF Board is responsible for the operation of
these measures. The Pooled Development Funds Act 1992 provides for the
establishment and operation of the PDF Board.
Part 2 provides for:
(a) the registration requirements for venture capital limited partnerships
and Australian venture capital funds of funds; and
(b) applications for registration; and
(c) registration of limited partnerships by the PDF Board, including
conditional registration; and
(d) the obligations imposed on general partners of partnerships that are
registered; and
(e) revocation of registration.
Part 3 provides for registration of entities as eligible venture
capital investors, their obligations while registered, and revocation of
registration.
Part 4 provides for the PDF Board to make determinations that are
relevant to whether certain investments can be eligible venture capital
investments.
Part 5 provides for review of the PDF Board’s decisions under
this Act.
Part 6 deals with miscellaneous matters.
The PDF Board can register limited partnerships as venture capital limited
partnerships or Australian venture capital funds of funds.
Registration is one of the requirements before investments of venture
capital through a limited partnership can attract the operation of:
• the capital gains tax exemption relating to
venture capital under Subdivision 118-F of the Income Tax Assessment Act
1997 (and the related provisions about similar income gains and losses);
and
• the “flow-through” treatment,
under Division 5 of Part III of the Income Tax Assessment Act
1936, of the income of limited partnerships.
Broadly speaking, the PDF Board will register a limited partnership under
Division 13 if an application meets the requirements of Division 11,
unless the PDF Board is satisfied that the partnership does not meet the
applicable registration requirements of Division 9.
Conditional registration is an option if an application does not meet the
requirements of Division 11.
Note: Conditional registration becomes important if full
registration is achieved. Registration is then backdated to the time of
conditional registration. However, this only backdates the
“flow-through” treatment of the partnership income. The other tax
consequences operate from the time of unconditional
registration.
The PDF Board can revoke a registration under Division 17. Broadly
speaking, the grounds for revocation are:
• failure to meet the applicable registration
requirements of Division 9; and
• failure to provide information as required
under Division 15.
Table of sections
9-1 Registration requirements of VCLPs
9-5 Registration requirements of AFOFs
9-10 Meaning of
permitted loan
(1) The registration requirements of a VCLP, in relation to
a *limited partnership, are that:
(a) the partnership was established by or under a law in force in, or in
any part of:
(i) Australia; or
(ii) Canada; or
(iii) France; or
(iv) Germany; or
(v) Japan; or
(vi) the United Kingdom; or
(vii) the United States of America; or
(viii) any other foreign country prescribed by the regulations;
and
(b) all of the partners who are *general
partners are residents of a country referred to in paragraph (a);
and
(c) under the partnership agreement the partnership is to remain in
existence for a period of not less than 5 years and not more than 15 years;
and
(d) the partnership’s *committed
capital is at least $20 million; and
(e) each investment that the partnership holds is either:
(i) an *eligible venture capital
investment; or
(ii) an investment in a company, in which the partnership owns one or more
eligible venture capital investments, that would have been an eligible venture
capital investment but for subsections 118-425(2) and (6) of the Income Tax
Assessment Act 1997; and
(f) the partnership only carries on activities that are related to making
*eligible venture capital investments or
investments to which subparagraph (e)(ii) applies; and
(g) every *debt interest that the
partnership owns is, and continues to be, a
*permitted loan.
(2) The requirements in paragraphs (1)(e), (f) and (g) are
investment registration requirements.
(1) The registration requirements of an AFOF, in relation to
a *limited partnership, are that:
(a) the partnership is established by or under the law of a State or
Territory; and
(b) all of the partners who are *general
partners are *Australian residents;
and
(c) under the partnership agreement, the partnership is to remain
in existence for a period of not less than 5 years and not more than 20 years;
and
(d) each investment that the partnership owns is:
(i) an investment in a *VCLP;
or
(ii) an *eligible venture capital
investment in a company in which a VCLP, of which the partnership is a partner,
owns one or more eligible venture capital investments; or
(iii) an investment in a company referred to in subparagraph (ii)
that would have been an eligible venture capital investment but for subsections
118-425(2) and (6) of the Income Tax Assessment Act 1997; and
(e) the partnership only carries on activities that are related to making
eligible venture capital investments, investments to which
subparagraph (d)(iii) applies or investing in VCLPs; and
(f) every *debt interest that the
partnership owns is, and continues to be, a
*permitted loan.
(2) The requirements in paragraphs (1)(d), (e) and (f) are
investment registration requirements.
(1) A debt interest is a permitted loan if:
(a) it is a loan made to a *company and
the sum of:
(i) the *equity interests that the
partnership owns in the company; and
(ii) any debt interests that the partnership owns in the company that can
be converted into equity interests in the company;
is at least 10% of the sum of:
(iii) all of the equity interests in the company; and
(iv) all of the debt interests in the company that can be converted into
equity interests in the company;
and the company meets the requirements of subsections 118-425(2) to (7)
of the Income Tax Assessment Act 1997 in relation to the investments
referred to in subparagraphs (i) and (ii); or
(b) it is repaid within 6 months, or such longer period as the
*PDF Board allows under
subsection (3).
(2) A *general partner may apply to the
*PDF Board, in the
*form approved by the PDF Board, for the PDF
Board to allow a longer period for the purposes of
paragraph (1)(b).
(3) The *PDF Board may, for the purposes
of paragraph (1)(b), allow a longer period if the PDF Board is satisfied
that:
(a) there are exceptional circumstances; and
(b) the extended period is no longer than reasonably
necessary.
Table of sections
11-1 Application for registration
11-5 Determination of further information to be included in
application
11-10 Further information may be requested
11-15 Period within which application must be
decided
(1) A *general partner of a
*limited partnership may apply, in the
*form approved by the PDF Board, to the
*PDF Board for registration of the partnership
as a *VCLP or an
*AFOF under this Part.
(2) An application must be in writing, and must include the following
information:
(a) the name and residency status of, and the relevant qualifications and
experience of, each *general partner;
(b) the name, address and residency status of each
*limited partner;
(c) for each general partner that is a
*company—the address of the general
partner’s registered office;
(d) for each general partner who is an individual—the general
partner’s business address;
(e) the partnership’s business address;
(f) a copy of the partnership agreement, which must:
(i) require partners to contribute their
*committed capital as and when required under
the agreement; and
(ii) prohibit the addition of new partners to the partnership except as
provided for in the agreement; and
(iii) prohibit increases in the partnership’s committed capital
except as provided for in the agreement; and
(iv) confer on a general partner the right to require partners to
contribute their committed capital to the partnership; and
(v) include a plan which outlines the partnership’s future intended
investment activities;
(g) any documents that were issued inviting investment in the
partnership;
(h) the amount of each partner’s committed capital in the
partnership;
(i) in relation to each limited partner claiming to be tax exempt in his
or her country of residence—details of the facts that qualify the partner
to be tax exempt in his or her country of residence;
(j) if the application is an application for registration as a
VCLP—a statement by a general partner as to whether the partnership meets
the *registration requirements of a
VCLP;
(k) if the application is an application for registration as an
AFOF—a statement by a general partner as to whether the partnership meets
the *registration requirements of an
AFOF;
(l) such further information as the *PDF
Board determines under section 11-5.
Note: Part 7.4 of the Criminal Code creates
offences for making false and misleading statements, giving false or misleading
information and producing false or misleading documents.
(1) The *PDF Board may, for the purposes
of paragraph 11-1(2)(l), determine, by writing signed by the Chairperson of the
PDF Board pursuant to a resolution of the PDF Board, that specified information
is to be included in the application.
(2) A determination under this section is a disallowable instrument for
the purposes of section 46A of the Acts Interpretation Act
1901.
If the *PDF Board needs further
information to decide an application for registration under this Part, it may
ask a *general partner to provide further
information.
(1) Subject to this section, the *PDF
Board must decide an application for registration or conditional registration
under this Part within 60 days after receiving it.
(2) If the *PDF Board thinks that it will
take longer to decide the application, the PDF Board may extend, by up to 60
days, the period for deciding it.
(3) An extension must be made by written notice given to a
*general partner within 60 days after the
*PDF Board receives the application.
(4) If the *PDF Board extends the period,
the PDF Board must decide the application within the extended
period.
Table of sections
13-1 Registration
13-5 Conditional registration
13-10 When registration is in force
(1) The *PDF Board must register a
partnership as a *VCLP under this Part
if:
(a) a *general partner has applied for
registration as a VCLP; and
(b) the application meets the requirements under section 11-1;
and
(c) any further information requested under section 11-10 has been
provided; and
(d) a general partner has notified the PDF Board that the VCLP has
sufficient funds to begin its investment program;
unless the PDF Board is satisfied that the partnership:
(e) does not meet the *registration
requirements of a VCLP; or
(f) has had a previous registration revoked under
Division 17.
(2) The *PDF Board must register a
partnership as an *AFOF under this Part
if:
(a) a *general partner has applied for
registration as an AFOF; and
(b) the application meets the requirements under section 11-1;
and
(c) any further information requested under section 11-10 has been
provided; and
(d) a general partner has notified the PDF Board that the AFOF has
sufficient funds to begin its investment program;
unless the PDF Board is satisfied that the partnership:
(e) does not meet the *registration
requirements of an AFOF; or
(f) has had a previous registration revoked under
Division 17.
(3) If the *PDF Board decides to register
the partnership as a *VCLP or an
*AFOF under this Part, the PDF Board must
notify a *general partner of the partnership as
soon as practicable after the decision is made.
(4) If the *PDF Board decides not to
register the partnership as a *VCLP or an
*AFOF under this Part, the PDF Board
must:
(a) notify a *general partner of the
partnership as soon as practicable after the decision is made; and
(b) provide reasons for the decision.
(5) The *PDF Board cannot register the
partnership both as a *VCLP and as an
*AFOF.
(1) The *PDF Board may conditionally
register the partnership as a *VCLP
if:
(a) a *general partner has applied for
registration as a VCLP; and
(b) either:
(i) the application for registration does not meet the requirements under
section 11-1; or
(ii) any further information requested under section 11-10 has not
been provided;
unless the PDF Board is satisfied that the partnership:
(c) would not, if it was conditionally registered, meet the
*registration requirements of a VCLP within the
period specified under subsection 13-10(3); or
(d) has had a previous registration revoked under
Division 17.
(2) The *PDF Board may conditionally
register the partnership as an *AFOF
if:
(a) a *general partner has applied for
registration as an AFOF; and
(b) either:
(i) the application for registration does not meet the requirements under
section 11-1; or
(ii) any further information requested under section 11-10 has not
been provided;
unless the PDF Board is satisfied that the partnership:
(c) would not, if it was conditionally registered, meet the
*registration requirements of an AFOF within
the period specified under subsection 13-10(3); or
(d) has had a previous registration revoked under
Division 17.
(3) Conditional registration under this section does not mean that the
partnership is registered under this Part as a
*VCLP or an
*AFOF.
(1) Registration of the partnership as a
*VCLP or an
*AFOF comes into force on the day on which
registration under section 13-1 was granted.
(2) However, if conditional registration of the partnership had been
granted under section 13-5 and was in force on the day on which
registration under section 13-1 was granted, registration of the
partnership as a *VCLP or an
*AFOF is taken to have come into force
on:
(a) if, since its establishment, the partnership has only carried on
activities related to becoming registered as a VCLP or an AFOF—the day on
which it was established; or
(b) otherwise—the day on which the conditional registration was
granted.
(3) If a *VCLP or an
*AFOF is not registered under section 13-1
within 24 months after the day on which the conditional registration of the
partnership was granted under section 13-5, the conditional registration
lapses.
(4) Registration is taken to be in force until revoked under
Division 17.
Table of sections
15-1 Annual return
15-5 Determination of further information to be included in
returns
15-10 Quarterly returns
15-15 Further information may be requested
15-20 Other information may be requested
A *general partner of a partnership
registered under this Part as a *VCLP or an
*AFOF must, within 3 months after the end of
each *financial year, give the
*PDF Board a written return that includes the
following information:
(a) the name and address of each partner, and that partner’s
residency status at the end of the financial year (including details of changes
to that status during the year);
(b) in relation to each partner claiming to be tax exempt—details of
the facts that qualify the partner to be tax exempt in his or her country of
residence;
(c) details of:
(i) the amount of each partner’s
*committed capital in the partnership;
and
(ii) any acquisitions or disposals of a partner’s
*equity interests in the partnership during the
year including any consideration given or received for that acquisition or
disposal;
(d) details of any variation made to the partnership agreement during the
year;
(e) details of:
(i) investments the partnership made during that year; and
(ii) investments the partnership owns at the end of that year;
and
(iii) disposals of investments during that year including any profits
derived or losses incurred from that disposal;
(f) if the partnership is registered under this Part as a VCLP—a
statement from a general partner as to whether the partnership met the
*registration requirements of a VCLP throughout
the financial year;
(g) if the partnership is registered under this Part as an AFOF—a
statement from a general partner as to whether the partnership met the
*registration requirements of an AFOF
throughout the financial year;
(h) such further information as the PDF Board determines under
section 15-5.
Note: Part 7.4 of the Criminal Code creates
offences for making false or misleading statements, giving false or misleading
information and producing false or misleading documents.
(1) The *PDF Board may, for the purposes
of paragraph 15-1(h), determine, by writing signed by the Chairperson of the PDF
Board pursuant to a resolution of the PDF Board, that specified information is
to be included in returns.
(2) A determination under this section is a disallowable instrument for
the purposes of section 46A of the Acts Interpretation Act
1901.
A*general partner of a partnership
registered under this Part as a *VCLP or an
*AFOF must, within one month after the end of
each *quarter, give the
*PDF Board a written return that
includes:
(a) details of any investments it has made during the quarter, and the
consideration given for those investments; and
(b) details of any disposals of investments during the quarter, and any
profit derived or loss incurred from those disposals (including details of how
that profit or loss was calculated).
The *PDF Board may ask a
*general partner of the partnership to provide
further information about the investments or disposals notified under
section 15-10.
The *PDF Board may ask a
*general partner of the partnership to provide
the PDF Board with information that the PDF Board considers necessary for the
purposes of administering this Act.
Table of sections
17-1 Revoking registration for not meeting investment
registration requirements etc.
17-5 Revoking registration for not meeting other
registration requirements
17-10 Revocation at discretion of PDF Board
17-15 Notice of revocation
17-20 Date of effect of revocation
17-25 Revocation on application by
partnership
(1) If the *PDF Board has reason to
believe that:
(a) a partnership registered as a *VCLP
does not meet the *investment registration
requirements of a VCLP; or
(b) a partnership registered as an *AFOF
does not meet the *investment registration
requirements of an AFOF;
it must notify a *general partner of the
partnership, in writing, that it will revoke the registration if it is satisfied
that, at the end of the period determined under subsection (2), the
partnership does not meet the investment registration requirements of a VCLP or
an AFOF, as the case may be.
(2) The *PDF Board must, for the purposes
of subsection (1), determine a period that:
(a) it is satisfied is a reasonable period; and
(b) does not exceed 6 months.
(3) The notice must:
(a) state the matters that in the *PDF
Board’s opinion, may constitute grounds for revocation; and
(b) state the period, determined by the PDF Board under
subsection (2), within which the
*investment registration requirements must be
complied with; and
(c) state that the *general partner may
make written submissions to the PDF Board about the matters in the notice within
that period.
(4) A *general partner may make
submissions about the matters in the notice at any time during that
period.
(5) The *PDF Board must revoke the
registration if, after considering any submissions made under
subsection (4), it is satisfied that, at the end of that period, the
partnership does not meet the *investment
registration requirements of a VCLP or the
*investment registration requirements of an
AFOF, as the case may be.
(6) Subsection (5) does not apply if the registration is revoked
under section 17-10 within that period.
(1) If the *PDF Board has reason to
believe that:
(a) a partnership registered as a *VCLP
does not meet the *registration requirements of
a VCLP that are not *investment registration
requirements; or
(b) a partnership registered as an *AFOF
does not meet the *registration requirements of
an AFOF that are not *investment registration
requirements;
it must notify a *general partner of the
partnership, in writing, that it will revoke the registration if it is satisfied
that, in 60 days time, the partnership does not meet the registration
requirements of a VCLP or an AFOF, as the case may be.
(2) The notice must:
(a) state the matters that, in the *PDF
Board’s opinion, may constitute grounds for revocation; and
(b) state that the *general partner may
apply for an extension of the 60 day period; and
(c) state that the general partner may make written submissions to the PDF
Board about the matters in the notice within the 60 day period or that period as
extended under subsection (4).
(3) A *general partner may apply to the
*PDF Board, in the
*form approved by the PDF Board, for an
extension of the 60 day period.
(4) The *PDF Board may, for the purposes
of paragraph (2)(c), extend, by up to 60 days, the period if it is
satisfied that:
(a) reasonable progress is being made towards meeting the requirements;
and
(b) the requirements will be met within the extended period.
(5) A *general partner may make
submissions about the matters in the notice at any time during:
(a) the 60 day period; or
(b) if the period was extended under subsection (4)—that
extended period.
(6) The *PDF Board must revoke the
registration if, after considering any submissions made under
subsection (5), it is satisfied that:
(a) at the end of the 60 day period; or
(b) if the period was extended under subsection (4)—that
extended period;
the partnership does not meet the
*registration requirements of a VCLP or the
*registration requirements of an AFOF, as the
case may be.
(1) Subject to subsection (2), the
*PDF Board may revoke a partnership’s
registration as a *VCLP or an
*AFOF under this Part if the PDF Board is
satisfied that the partnership has:
(a) failed to lodge an annual return under section 15-1; or
(b) failed to lodge a quarterly return under section 15-10;
or
(c) failed to provide any further information requested under
section 15-15; or
(d) failed to provide any information requested under section 15-20;
or
(e) during a 12 month period, received more than one notice under
section 17-1:
(i) that related to a failure to meet the registration requirement set out
in paragraph 9-1(1)(e) or 9-5(1)(d) (whichever is applicable); and
(ii) in relation to which the partnership’s registration has not
been revoked.
(2) The *PDF Board must not revoke the
partnership’s registration unless the PDF Board:
(a) by notice in writing given to a
*general partner of the partnership, allows the
general partner at least 28 days after the notice is given in which to make
written submissions to the PDF Board about the matters specified in the notice
that, in the PDF Board’s opinion, may constitute grounds for revocation;
and
(b) considers any such submissions.
As soon as practicable after revoking a partnership’s registration
under section 17-1, 17-5 or 17-10, the
*PDF Board must give a
*general partner of the partnership a notice
that advises of the revocation and sets out the PDF Board’s reasons for
deciding to revoke.
The revocation takes effect from the day on which the
*PDF Board decides to revoke
registration.
(1) A *general partner of a partnership
registered under this Part as a *VCLP or an
*AFOF may apply in writing to the
*PDF Board to have the registration
revoked.
(2) The *PDF Board must revoke the
registration as soon as practicable after receiving the application.
(3) The revocation takes effect on the day on which notice of the
revocation is given to a *general partner of
the partnership.
The PDF Board can register entities as eligible venture capital investors,
and revoke their registration.
Registration is one of the requirements before investments of venture
capital by an entity directly (rather than through a limited partnership) can
attract the operation of section 118-415 of the Income Tax Assessment
Act 1997 (and the related provisions about similar income gains and
losses).
Note: Section 118-415 of the Income Tax Assessment
Act 1997 gives to an individual investor an equivalent capital gains tax
exemption to the one that the investor could have, under section 118-405 or
118-410 of that Act, from investing through a limited partnership registered
under Part 2 of this Act.
Table of sections
Operative provisions
21-5 Registration as eligible venture capital
investors
21-10 Period within which application must be
decided
21-15 When registration is in force
21-20 Annual return by eligible entity
21-25 Revocation at discretion of PDF Board
21-30 Revocation on application
[This is the end of the Guide]
(1) An *entity may apply to the
*PDF Board, in the
*form approved by the PDF Board, for
registration under this Part as an *eligible
venture capital investor.
(2) An application must be given to the
*PDF Board within 30 days after the applicant
enters into the contract to acquire its first
*eligible venture capital investment after the
commencement of this Act.
(3) An application must be in writing, and must include the following
information:
(a) the applicant’s current residency status;
(b) details of the facts that qualify the applicant as a
*tax-exempt non-resident;
(c) the address of the applicant’s registered office;
(d) the name and address of the first
*company in which the applicant has invested or
proposes to invest and the industry in which the company operates;
(e) the amount of the investment and the date on which it was or is to be
made;
(f) details of any other investments that the applicant holds in the
company that are not *eligible venture capital
investments.
(4) The *PDF Board must register the
applicant under this Part if the PDF Board is satisfied that the information has
been provided.
(5) If the *PDF Board registers an
applicant under this Part, the PDF Board must notify the applicant within 60
days after the application was made.
(6) If the *PDF Board does not register
an applicant under this Part, the PDF Board must:
(a) notify the applicant within 60 days after the application was made;
and
(b) provide reasons for the decision.
(1) Subject to this section, the *PDF
Board must decide an application for registration under this Part within 60 days
after receiving it.
(2) If the *PDF Board thinks that it will
take longer to decide the application, the PDF Board may extend, by up to 60
days, the period for deciding it.
(3) An extension must be made by written notice given to the applicant
within 60 days after the *PDF Board receives
the application.
(4) If the *PDF Board extends the period,
the PDF Board must decide the application within the extended period.
(1) Registration of an *entity as an
*eligible venture capital investor is taken to
have come into force on the day on which the first investment referred to in
subsection 21-5(2) was made.
(2) Registration is taken to be in force until revoked under
section 21-25.
(1) An *entity registered under this Part
must, within 3 months after the end of each
*financial year, give the
*PDF Board a written return that includes the
following information:
(a) the entity’s residency status at the end of the financial year
(including details of changes to that status during the year);
(b) the address of the entity’s registered office (including details
of changes to that address during the year);
(c) details of the facts that qualify the entity to be tax exempt in its
country of residence;
(d) details of the facts that qualify the entity as an
*eligible venture capital investor;
(e) details of:
(i) the *eligible venture capital
investments the entity made during that year; and
(ii) the eligible venture capital investments that the entity disposed of
during that year; and
(iii) the eligible venture capital investments the entity holds at the end
of that year; and
(iv) the disposals of eligible venture capital investments during that
year including any profits derived or losses incurred from that
disposal;
(f) the industries to which those investments relate.
(2) Information about a matter that a return must include because of
paragraph (1)(a) or (b) is information about that matter as at the end of
the financial year.
Note: Part 7.4 of the Criminal Code creates
offences for making false and misleading statements, giving false or misleading
information and producing false or misleading documents.
(1) Subject to this section, the *PDF
Board may revoke an *entity’s
registration under this Part if the PDF Board is satisfied that the entity has
failed to comply with section 21-20.
(2) As soon as practicable after revoking an
*entity’s registration under this Part,
the *PDF Board must give the entity a notice
that advises of the revocation and sets out the PDF Board’s reasons for
deciding to revoke.
(3) The *PDF Board must not revoke a
registration unless the PDF Board:
(a) by notice in writing given to the
*entity, allows the entity at least 14 days
after the notice is given in which to make written submissions to the PDF Board
about the matters specified in the notice that, in the PDF Board’s
opinion, may constitute grounds for revocation; and
(b) considers any such submissions.
(1) An *entity registered under this Part
may apply in writing to the *PDF Board to have
its registration revoked.
(2) The *PDF Board must revoke the
registration as soon as practicable after receiving the application.
(3) The revocation takes effect on the day on which notice of the
revocation is given to the
*entity.
The PDF Board can make determinations having the effect of relaxing the
requirements of paragraph 18-425(2)(b) of the Income Tax Assessment Act
1997.
Note: Paragraph 18-425(2)(b) of the Income Tax Assessment
Act 1997 is about how closely a company is connected with Australia. It is
one of the requirements that a company must meet in order for investments in the
company to be eligible venture capital investments. The capital gains tax
exemption under Subdivision 118-F of that Act only applies in relation to
eligible venture capital investments.
Table of sections
Operative provisions
25-5 PDF Board may determine a shorter
period
25-10 PDF Board may determine that a requirement does not
apply
[This is the end of the Guide]
(1) The *PDF Board may, on the
application of a *general partner of a
*limited partnership registered as a
*VCLP or an
*AFOF, determine a shorter period during which
a *company must meet the requirements of
paragraph 118-425(2)(b) of the Income Tax Assessment Act 1997.
(2) The application must be in the *form
approved by the PDF Board.
(3) In considering whether to make a determination, the
*PDF Board must apply the principles specified
under subsection (4).
(4) The *PDF Board may make principles
about making determinations under this section.
(5) If the *PDF Board determines a
shorter period, the PDF Board must notify the
*general partner as soon as practicable after
the determination is made.
(6) If the *PDF Board refuses to make a
determination, the PDF Board must:
(a) notify the *general partner as soon
as practicable after the refusal; and
(b) provide reasons for the refusal.
(7) Principles made under subsection (4) are disallowable instruments
for the purposes of section 46A of the Acts Interpretation Act
1901.
(1) The *PDF Board may, on the
application of a *general partner of a
partnership registered as a VCLP or an AFOF, determine that either or both of
the following requirements do not apply to a
*company:
(a) the requirement referred to under subparagraph 118-425(2)(b)(i) of the
Income Tax Assessment Act 1997 that more than 50% of the people who are
currently engaged by the company to perform services must perform those services
primarily in Australia;
(b) the requirement referred to under subparagraph 118-425(2)(b)(ii) of
that Act that more than 50% of its assets (determined by value) must be situated
in Australia.
(2) The application must be in the *form
approved by the PDF Board.
(3) In considering whether to make a determination, the
*PDF Board must apply the principles specified
under subsection (4).
(4) The *PDF Board may make principles
about making determinations under this section.
(5) If the *PDF Board determines that a
requirement does not apply, the PDF Board must notify the
*general partner as soon as practicable after
the determination is made.
(6) If the *PDF Board refuses to make a
determination, the PDF Board must:
(a) notify the *general partner as soon
as practicable after the refusal; and
(b) provide reasons for the refusal.
(7) Principles made under subsection (4) are disallowable instruments
for the purposes of section 46A of the Acts Interpretation Act
1901.
Table of sections
29-1 Decisions reviewed
29-5 Notification of right to seek internal
review
29-10 Internal review of decisions
29-15 Review of decisions by Administrative Appeals
Tribunal
The following decisions of the *PDF
Board are reviewable under this Part:
(a) decisions under subsection 9-10(3) allowing, or refusing to allow, a
longer period for the purposes of paragraph 9-10(1)(b) for repayment of a
*permitted loan;
(b) decisions under section 13-1 refusing to register a
*limited partnership as a
*VCLP or an
*AFOF under Part 2;
(c) decisions under section 13-5 refusing to register conditionally a
limited partnership as a VCLP or an AFOF;
(d) decisions under section 17-1, 17-5 or 17-10 revoking a
registration under Part 2;
(e) decisions under subsection 17-1(2) determining a period within which
*investment registration requirements must be
met;
(f) decisions under section 21-5 refusing to register an entity as an
*eligible venture capital investor under
Part 3;
(g) decisions under section 21-25 revoking a registration under
Part 3;
(h) decisions under section 25-5 determining a shorter period, or
refusing to make such a determination; or
(i) decisions under section 25-10 refusing to make a
determination.
(1) A notice that:
(a) is given to the *person affected by a
decision that is reviewable under this Part; and
(b) advises that person of the decision;
must include a statement to the effect that the person may, under
section 29-10, request the *PDF Board to
reconsider the decision.
(2) The person affected by the decision is the person who made the
relevant application to the PDF Board.
(3) A failure to comply with subsection (1) in relation to a decision
reviewable under this Part does not affect the validity of the
decision.
(1) If the *person affected by a decision
that is reviewable under this Part is dissatisfied with the decision, the person
may, by notice in writing given to the *PDF
Board, request the PDF Board to reconsider the decision.
(2) The request must not be made more than 21 days, or such longer period
as the *PDF Board approves, after the person
receives from the PDF Board a notice advising of the decision.
(3) The request must set out the person’s reasons for making
it.
(4) On receipt of the request, the *PDF
Board must reconsider the decision and may confirm or revoke it, or vary it in
such manner as the PDF Board thinks fit.
(5) If the *PDF Board does not confirm,
vary or revoke the decision before the end of the period of 60 days after the
day on which the PDF Board receives the request, the PDF Board is taken, at the
end of that period, to have confirmed the decision.
(6) As soon as practicable after the *PDF
Board confirms, varies or revokes the decision, the PDF Board must give the
person a written notice that:
(a) advises of the confirmation, variation or revocation of the decision;
and
(b) except in a case to which subsection (5) applies—advises of
the PDF Board’s reasons for confirming, varying or revoking the decision;
and
(c) in the case of a confirmation or variation of the
decision—advises the person that the person may apply to the
Administrative Appeals Tribunal under the Administrative Appeals Tribunal Act
1975 for review of the decision as confirmed or varied.
(7) A failure to comply with subsection (6) in relation to the
confirmation, variation or revocation of the decision does not affect the
validity of the confirmation, variation or revocation.
(8) For the purposes of subsections (4), (5), (6) and (7) and
section 29-15, if the *PDF Board revokes a
decision and replaces it with another decision:
(a) the PDF Board is taken to vary the first-mentioned decision and not to
revoke it; and
(b) the other decision is taken to be the first-mentioned decision as
varied.
(1) Application may be made to the Administrative Appeals Tribunal for a
reviewable decision of the *PDF Board that has
been confirmed or varied under section 29-10.
(2) An application may only be made by
*the person affected by the
decision.
Table of sections
33-1 Annual report
33-5 Meaning of form approved by the PDF
Board
33-10 Regulations
(1) The *PDF Board must, as soon as
practicable after the end of each *financial
year, prepare and give to the Minister a report of its operations during that
year.
(2) The *PDF Board must include in the
report:
(a) a list of the partnerships registered under Part 2 as at the end
of the financial year; and
(b) a list of the *partnerships that
became registered under that Part during the
*financial year; and
(c) a list of the partnerships whose registration under that Part was
revoked during the financial year.
(3) The *PDF Board must also include in
the report:
(a) a list of the *entities registered
under Part 3 as at the end of the
*financial year; and
(b) a list of the entities that became registered under that Part during
the financial year; and
(c) a list of the entities whose registration under that Part was revoked
during the financial year.
A notice or application is in the form approved by
the PDF Board if:
(a) it is in the form approved by the
*PDF Board for that kind of notice or
application; and
(b) it contains a declaration signed by a person or persons as the form
requires; and
(c) it contains the information that the form requires, and any further
information, statement or document as the PDF Board requires, whether in the
form or otherwise; and
(d) it is given in the manner that the PDF Board requires (which may
include electronically).
The Governor-General may make regulations prescribing matters:
(a) required or permitted by this Act to be prescribed; or
(b) necessary or convenient to be prescribed for carrying out or giving
effect to this Act.