Developers, real estate agents and existing shareholders frequently market company title shares to the public.
These marketing activities need to bring into account Part 6D.2 of the Corporations Act 2001, and the Australian Financial Services Licensing provisions.
Legal requirements for marketing Company Title Shares
Part 6D.2 requires anyone marketing shares to disclose certain information to potential purchasers.
Thankfully, ASIC has provided a conditional exemption for compliance with Part 6D.2 for secondary sales of shares in company title buildings. The exemption depends on the sale contract containing certain terms and information.
This means that an existing shareholder can sell his or her shares through a real estate agent without having to produce a disclosure document such as an offer information statement.
However, as the relief relates only to secondary sales of shares, developers who wish to issue shares in a new company title development may have more difficulties. This problem can be managed by selecting a fitting structure for the transaction and carefully crafting an application for relief from ASIC.
If you have any questions about how to properly market company title shares, add your comments below.
John Morrissey has been a practising Sydney solicitor for 30 years, and for the past 20 a sole practitioner and the principal at JFMLAW.
His main focus employment law, advising small to medium-sized firms and their employees of their rights and obligations.
For many years he was a lecturer at UTS to students obtaining Masters in Human Resources Management with a focus on performance management and creating a culture of delivery in workplaces. John has acted for a significant number of employers, not only in developing a performance based culture in the workplace but also solving particular problems that arise relating to unfair dismissal, contract disputes, improper use of intellectual property or other property as well as enforcements of restraints of trade.
John is very happy to speak to any employer who has an issue on a free of charge basis by a phone call. Please feel free to ring John at anytime up to 6pm most days.
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