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CORPORATIONS ACT 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS    View history reference

PART 7.9 - FINANCIAL PRODUCT DISCLOSURE AND OTHER PROVISIONS RELATING TO ISSUE, SALE AND PURCHASE OF FINANCIAL PRODUCTS    View history reference

Division 5A - Unsolicited offers to purchase financial products off-market    View history reference

SECTION 1019K  RIGHTS IF REQUIREMENTS OF DIVISION NOT COMPLIED WITH  

 View history reference

1019K(1)  First situation covered by this section - offers to which this Division applies.  


This section applies if, in relation to an offer to which this Division applies, the offeree (the seller) accepts the offer and enters into a contract for the sale of the financial product to the offeror (the buyer), and one or more of the following paragraphs applies:


(a) section 1019E was not complied with in relation to the offer;


(b) the offer was accepted after the period referred to in paragraph 1019G(1)(b);
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(c) the offeror gave the offeree an offer document and either:


(i) the offer document did not comply with section 1019I; or

(ii) there was a misleading or deceptive statement in the offer document;


(d) in a situation to which section 1019J applies, either:


(i) subsection 1019J(2) was not complied with; or

(ii) subsection 1019J(2) was complied with, but the offeree did not receive the withdrawal document, or the supplementary offer document, as the case requires, until after the offeree had accepted the offer;


(e) in a situation to which section 1019J applies, the offeror gave the offeree a supplementary offer document and either:


(i) the supplementary offer document did not comply with subsection 1019J(3); or

(ii) there was a misleading or deceptive statement in the supplementary offer document.

1019K(2)  Second situation covered by this section - invitations prohibited by section 1019F.  


This section applies if, in response to an invitation prohibited by section 1019F, a person (the seller) makes an offer to sell a financial product to the person who made the invitation (the buyer), and that person accepts the offer and enters into a contract for the purchase of that financial product from the seller.

1019K(3)  Seller's right to refuse to transfer, or to seek the return of, the financial product.  


The seller has:


(a) the right to refuse to transfer the financial product to the buyer; or


(b) if the seller has already transferred the financial product to the buyer - the right to have the financial product returned to the seller, if the buyer still holds the product.

The seller's right under paragraph (a) or (b) is conditional on the seller repaying any money that has been paid to the seller for the purchase of the financial product.

1019K(4)  How the seller's right is to be exercised.  


The seller's right under subsection (3) must be exercised by notifying the buyer in one of the following ways:


(a) in writing;


(b) electronically;


(c) in any other way specified in regulations made for the purposes of this paragraph.

Also, if the regulations require the seller to comply with other requirements in order to exercise that right, those other requirements must be complied with.

1019K(5)  [Time limit for exercise of rights]  


The seller's right under subsection (3) can only be exercised during the period of 30 days starting on the day the contract was entered into.

1019K(6)  Effect of exercise of seller's right.  


On the exercise of the seller's right under subsection (3), the contract referred to in subsection (1) or (2) is, by force of this section, terminated from that time without penalty to the seller.

1019K(7)  Regulations may provide for certain matters.  


The regulations may provide for consequences and obligations (in addition to those provided for by subsection (6)) to apply if the seller's right under subsection (3) is exercised.

1019K(8)  [Repayment may vary]  


The regulations may provide that, in specified circumstances, the amount to be repaid as mentioned in subsection (3) is to be increased or reduced in accordance with the regulations.


 



This information is provided by CCH Australia Limited. View the disclaimer and notice of copyright.
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