Delegation to Panel executive to decide straightforward applications for approval to act as an independent adviser

The Panel has delegated to the Panel's executive staff the Panel's power to approve independent advisers under the Takeovers Code. This has been achieved by way of a formal delegation under section 73 of the Crown Entities Act 2004 and is limited to "straightforward" cases only.

The Panel's policy for the approval of independent advisers sets out the criteria which the applicant must cover in their application to the Panel. These criteria relate largely to the independence of the adviser from the protagonists of the transaction. They also require the applicant to have in place adequate professional indemnity insurance and to have the capacity available to fulfill the advisory role under the Code.

Around half of the adviser applications received by the Panel would fall within the category of being 'straightforward'.

Process for Panel executive approval of straightforward independent adviser applications

The Panel executive will interact with the applicant in the same way for all applications. This ensures that all of the relevant information is provided for the application to be properly considered.

In the case of straightforward independent adviser applications, the decision regarding whether to approve the applicant will be made by the Panel's Chief Executive or, in the absence of the Chief Executive or if the Chief Executive is conflicted in respect of the matter, by the Panel's General Counsel ("the executive decision-maker").

If an application that falls within the delegation to the Panel executive for approval is, for some reason, not approved by the executive decision-maker, the application is automatically remitted to the Panel to decide whether to approve the adviser.

Timing

The Panel aims to make decisions on independent adviser applications in three working days from the time that all necessary information has been provided by the applicant. This performance measure is met by the Panel in about 85% of the applications it considers.

The delegation to the Panel executive of straightforward adviser approvals is intended to improve turnaround times for the straightforward applications. This should save both time and money for the applicants.

Notification of decision

The delegation to the Panel executive does not alter the fact that the approval of independent advisers is a power of the Panel. The letter sent to applicants advising of the Panel's decision regarding the application will not indicate whether the decision was made by the Panel executive under delegation or by the Panel itself, unless that information is specifically sought by the applicant.

Panel Releases

Discussion Paper on Upstream Takeovers

The Panel has published a discussion paper on the implications of the Takeovers Code for upstream takeovers. An upstream takeover is a takeover undertaken in New Zealand or overseas, which results in an acquirer controlling voting rights in a New Zealand Code company because the upstream target holds or controls voting rights in that Code company. The Panel wishes to adopt a clear and transparent policy on dealing with upstream takeovers so that it can provide clarity around the rules and certainty to the market. This will assist the efficiency of market transactions. The Panel is seeking submissions on the paper.The closing date for submissions is Friday, 12 June 2009.

Discussion Paper on Class Exemption for Buybacks

The Panel has published a discussion paper on the class exemption for buybacks contained in clause 4 of the Takeovers Code (Class Exemptions) Notice (No 2) 2001. The clause 4 class exemption allows a person who, together with associates, holds or controls more than 20% of a Code company to increase their control percentage by not selling into the buyback. The Panel wishes to ensure that the class exemptions relating to buybacks operate effectively and efficiently, and for this purpose the paper reviews the clause 4 class exemption. The Panel is seeking submissions on the paper. The closing date for submissions is 12 June 2009.

Page 4 | Code Word June 2009

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