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CORPORATIONS ACT 2001

CHAPTER 1 - INTRODUCTORY  

PART 1.2 - INTERPRETATION  

Division 6 - Subsidiaries and related bodies corporate  

SECTION 50AA  CONTROL  

50AA(1)  [Definition of control]  


For the purposes of this Act, an entity controls a second entity if the first entity has the capacity to determine the outcome of decisions about the second entity's financial and operating policies.

50AA(2)  [Definition of capacity]  


In determining whether the first entity has this capacity:


(a) the practical influence the first entity can exert (rather than the rights it can enforce) is the issue to be considered; and


(b) any practice or pattern of behaviour affecting the second entity's financial or operating policies is to be taken into account (even if it involves a breach of an agreement or a breach of trust).

50AA(3)  [Joint capacity]  


The first entity does not control the second entity merely because the first entity and a third entity jointly have the capacity to determine the outcome of decisions about the second entity's financial and operating policies.

50AA(4)  [Legal obligation to control]  


If the first entity:


(a) has the capacity to influence decisions about the second entity's financial and operating policies; and


(b) is under a legal obligation to exercise that capacity for the benefit of someone other than the first entity's members;

the first entity is taken not to control the second entity.

 



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