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Summary of

Securities Act (Continuous Debt Issues) Exemption Notice 2002

2002/296

Gazetted on 19 September 2002
Expires on 30 September 2007

This notice replaces the Securities Act (Continuous Debt Issues) Exemption Notice 1997 (the 1997 notice). It carries forward the provisions of the 1997 notice without any change of substance. Certain drafting changes have been made which reflect current drafting practice.

Effects of the exemption
The notice exempts issuers who in the ordinary course of their business continuously offer debt securities to the public from the requirement that a subscriber must have received an investment statement before subscribing for the securities and from certain other provisions of the Act relating to inspection of registers and issue of certificates.

Exemption relating to receipt of investment statements
Continuous issuers are exempted, subject to conditions, from section 37A(1)(a) of the Act in respect of continuous debt issues. The section requires that every subscriber for securities receives an investment statement before subscribing for securities.

Conditions
The exemption is subject to the condition that an investment statement for the debt securities is sent to the subscriber at least 3 working days before the person subscribes. If the investment statement is sent by fax, the fax machine must have recorded the transmission. If it is sent by other electronic means the machine used must not have generated a record that the investment statement has failed to be transmitted.

Exemption from register requirements
Continuous issuers are exempted, subject to conditions, from the requirement under section 52 of the Act to open the register to all security holders.

Conditions
The exemption is subject to the condition that that part of the register relating to a security holder's holding can be inspected by that security holder free of charge.

The exemption is subject to the further condition that on payment of a fee the issuer provides that security holder with a copy of the part of the register that relates to the securities held by that security holder.

Exemption from certificate requirements
Continuous issuers are exempted, subject to a condition, from section 54 of the Act in respect of continuous debt issues. Section 54 requires that the issuer send the security holder a written statement of the nature and ownership of the debt securities issued as part of the debt issue within one month of the allotment of the securities.

Condition
The exemption is subject to the condition that the issuer sends a written statement of the nature and ownership of the debt securities of the security holder on request, and at least once every 6 months.

Reasons
The Commission reviewed the 1997 notice and received submissions from interested parties. The exemptions in the 1997 notice were found to be relevant and useful and the terms and conditions of exemption are appropriate. The exemption reflects current Commission policy.