KPMG’s Anetta Johnston, David Jonavicius and Matthew Darling discuss draft legislation released by the Federal Government – the second tranche to follow the Hammond report on ‘Reforms for Cooperatives, Mutuals and Member-owned Firms’.
The Assistant Minister for Treasury and Finance Zed Seselja released for consultation, on 26 November, the exposure draft of the Treasury Laws Amendment (Measures for a later sitting) Bill 2018: Mutual entities (tranche 2) (Draft Legislation), highlighted in News in brief last week.
As the name suggests this is the second part of the government’s response to implementing recommendations from Greg Hammond’s Report on Reforms for Cooperatives, Mutuals and Member-owned Firms (Hammond Report) released in July 2017.
In October, we reported on the first tranche of legislation which had the following changes:
The second tranche
The second tranche of Draft Legislation provides for mutual entities registered under the Act as above to issue a new bespoke capital instrument, Mutual Capital Instruments (MCIs), without risking their mutual structure or status. The Draft Legislation also provides a standard process to allow eligible mutual entities to amend their constitutions to allow them to take advantage of these reforms.
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