SMO 2013
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What does the percentage change from 50 percent or more to 33 percent or more signify in terms of control reduction?

  • An ambiguous state of control.
  • An increase in control.
  • No change in control.
  • A decrease in control. (correct)

    • Which percentage range indicates a reduction in voting power according to the specified steps?

  • 33 percent or more to 20 percent or more. (correct)
  • 20 percent or more to 10 percent or more. (correct)
  • 50 percent or more to 33 percent or more.
  • 10 percent or more to less than 10 percent. (correct)

    • Who qualifies as a 'controller' under the provided definitions?

  • Anyone in the company hierarchy.
  • Only associates of the controller.
  • The controller and their associates. (correct)
  • Only the individual who owns the shares.

    • What is required when a controller becomes aware of a reduction in control?

    <p>Submit a written notice to the Authority.</p> Signup and view all the answers

    What percentage indicates the threshold between significant and moderate control reduction?

    <p>33 percent.</p> Signup and view all the answers

    What is the role of the Authority regarding consulting practitioners and investors?

    <p>To ensure its policies are aligned with its functions.</p> Signup and view all the answers

    If a controller's voting power falls from 20 percent or more to less than 10 percent, what does this signify?

    <p>A complete loss of control.</p> Signup and view all the answers

    What must the Authority do at least once a year?

    <p>Publish a report on its functions and regulatory objectives.</p> Signup and view all the answers

    Subsection (1) includes which of the following as relevant in determining control?

    <p>The percentage of voting power held.</p> Signup and view all the answers

    Which step does not indicate a decrease in control from a parent undertaking?

    <p>From 10 percent to 15 percent.</p> Signup and view all the answers

    What can the Authority include in a code of practice according to the content?

    <p>Descriptions of conduct compliant with statements of principle.</p> Signup and view all the answers

    What is a requirement for altering or replacing a statement of principle or code of practice?

    <p>It must be issued and published by the Authority.</p> Signup and view all the answers

    Which of the following is NOT specified as a factor in determining compliance with a statement of principle?

    <p>Descriptive standards set by industry leaders.</p> Signup and view all the answers

    What must the Authority do within three months of receiving a notice of control?

    <p>Decide whether to approve or serve a warning notice.</p> Signup and view all the answers

    What happens if the Authority fails to comply with section 8(1)?

    <p>The approval is automatically treated as given.</p> Signup and view all the answers

    Under what condition does the Authority's approval remain effective?

    <p>If acquisition occurs before a specified period or within 12 months.</p> Signup and view all the answers

    What may the Authority require from the person giving a notice of control?

    <p>Additional information or documents it deems necessary.</p> Signup and view all the answers

    What is a potential consequence for someone receiving a notice of objection to acquisition of control?

    <p>They must first receive a warning notice.</p> Signup and view all the answers

    What can the Authority impose when granting approval for acquisition of control?

    <p>Conditions as it sees fit.</p> Signup and view all the answers

    What kind of approval can the Authority give regarding the acquisition of control?

    <p>Unconditional or conditional approval.</p> Signup and view all the answers

    What time frame is specified for the acquisition of control after receiving an approval notice?

    <p>12 months from the date of the notice or decision.</p> Signup and view all the answers

    In how many circumstances can the Authority impose differing requirements related to a notice of control?

    <p>Various circumstances as it reasonably thinks necessary.</p> Signup and view all the answers

    Which of the following is true about the Authority's decision regarding a notice of control?

    <p>It must determine the action within a fixed period.</p> Signup and view all the answers

    What is the maximum time frame within which a controller must notify the Authority after becoming aware of a loss of control?

    <p>14 days</p> Signup and view all the answers

    What information must be included in the notice given to the Authority by a person who ceases to have control?

    <p>Details of the extent of control retained or still retained</p> Signup and view all the answers

    What constitutes an offence under subsection (1) regarding the duty to notify the Authority?

    <p>Not notifying the Authority about control reduction</p> Signup and view all the answers

    Under what condition is a person guilty of an offence after providing a notice of control?

    <p>If they execute the proposal before receiving approval</p> Signup and view all the answers

    What is a requirement for the format of a notice provided to the Authority?

    <p>It must be given in writing</p> Signup and view all the answers

    What action could lead to an offence if a warning notice has been issued?

    <p>Executing a proposal before receiving a decision on objection</p> Signup and view all the answers

    If a notice of objection has been issued, when is a person considered guilty of an offence?

    <p>When they acquire control while the notice is still effective</p> Signup and view all the answers

    What is the maximum fine for a person convicted of an offence under subsections (1), (2), (3) or (4)?

    <p>$100,000</p> Signup and view all the answers

    What is required from a person who fails to give a notice under subsection (2)?

    <p>They are committing an offence</p> Signup and view all the answers

    In the case of a continuing offence under subsection (5), how much additional fine can be imposed for each day the offence continues after conviction?

    <p>$15,000</p> Signup and view all the answers

    What is the significance of the 3-month period mentioned regarding notices provided to the Authority?

    <p>It is the time allowed for the Authority to assess the proposal</p> Signup and view all the answers

    What must a person charged under subsection (1) prove to establish a defense?

    <p>They had no knowledge of the act or circumstances requiring notification.</p> Signup and view all the answers

    What triggers the duty to notify the Authority according to subsection (1)?

    <p>Loss or reduction of control</p> Signup and view all the answers

    What is the time frame for a person to notify the Authority after becoming aware of an act or circumstances requiring notification?

    <p>14</p> Signup and view all the answers

    Which of the following is a description of a 'parent undertaking' according to the definition provided?

    <p>An individual deemed as a parent undertaking for the purposes of the Order.</p> Signup and view all the answers

    What is the maximum fine for failing to comply with the duty to notify the Authority as per subsection (9)?

    <p>$100,000</p> Signup and view all the answers

    What constitutes a 'subsidiary undertaking' in relation to bodies incorporated outside Brunei Darussalam?

    <p>An undertaking regarded as a subsidiary under local governing laws.</p> Signup and view all the answers

    Under what condition can a person be exempt from punishment despite being aware of a duty to notify?

    <p>If they had no knowledge of the act or circumstance at the time.</p> Signup and view all the answers

    If a person is found guilty of an offence under subsection (5), what is the maximum penalty they could face?

    <p>$150,000</p> Signup and view all the answers

    What additional fines may apply for continuing offences after conviction, specifically related to subsection (1)?

    <p>$10,000 per day</p> Signup and view all the answers

    Study Notes

    Control Reduction

    • A controller of a regulated person reduces their control when their percentage of shares owned in the regulated person or their parent undertaking decreases by a specified amount.
    • The specified decreases are:
      • 50% or more to 33% or more but less than 50%
      • 33% or more to 20% or more but less than 33%
      • 20% or more to 10% or more but less than 20%
      • 10% or more to less than 10%

    Control Acquisition Notification

    • A notice of control must be given to the Authority in writing, including information and documents as reasonably required by the Authority.
    • The Authority can request additional information or documents to determine appropriate action.
    • The Authority may impose different requirements in different circumstances.

    Authority Responsibilities

    • Before the expiry of 3 months from receiving a notice of control, the Authority must determine whether to approve the control or issue a warning notice.
    • If the Authority intends to issue a notice of objection, it must first provide a warning notice to the person acquiring control.

    Control Acquisition Approval

    • The Authority must notify the person acquiring control of its approval without delay.
    • Failure to comply with the 3-month time limit to respond is considered as approval.
    • Authority approval is only effective if the control is acquired within a specified time period.
    • The Authority may attach conditions to its approval.

    Control Reduction Notification

    • Controllers must notify the Authority within 14 days of becoming aware of control reduction or loss.
    • Notice must be given to the Authority upon control reduction or loss.
    • The notice must detail the extent of any remaining control over the regulated person.

    Offences

    • Failure to comply with the notification duties regarding control acquisition or reduction is an offence.
    • Carrying out control acquisition without Authority approval or in violation of warning notices is an offence.
    • Acquiring control despite a notice of objection is an offence.
    • Penalties for offences include fines.
    • It is a defence for a person charged with failure to notify to prove lack of knowledge.
    • Those who subsequently become aware of control acquisition or reduction responsibilities must notify the Authority within 14 days.
    • Failure to notify after becoming aware of the duty is an offence.

    Parent and Subsidiary Undertakings

    • "Parent undertaking" includes an individual who would be a parent undertaking if considered an undertaking.
    • "Subsidiary undertaking" includes a subsidiary as defined by applicable laws in countries outside Brunei Darussalam.

    Group

    • The Authority must follow generally accepted principles of good corporate governance.
    • The Authority must consult with practitioners and investors regarding its policies.
    • The Authority must publish a report annually on its performance and achievement of regulatory objectives.

    Statement of Principle and Code of Practice

    • The Authority may issue statements of principles regarding expected conduct of regulated persons and their controllers.
    • The Authority may issue a code of practice to help determine whether conduct complies with the statement of principle.
    • The code of practice may describe conduct compliant with or in violation of the statement of principle, and factors to consider when assessing compliance.
    • The Authority may alter or replace the statement of principle and code of practice.
    • Altered or revised statements and codes must be published.
    • Publication should be in a manner that effectively reaches the public.

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    Related Documents

    Brunei Darussalam Securities Markets Order, 2013 PDF

    Description

    Test your knowledge on control reduction and acquisition notifications in corporate governance. This quiz covers the specific percentages that lead to reduced control and the requirements for notifying the Authority. Understand the Authority's responsibilities regarding approvals and warning notices.

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