FORECAST STATEMENT OF SERVICE PERFORMANCE
FOR THE YEAR ENDED 30 JUNE 2009

FORECAST PERFORMANCE STANDARDS AND MEASURES FOR THE OUTPUTS OF THE PANEL

OUTPUT 1: Recommendations for changes to takeovers law:

Ensuring that the provisions of the Takeovers Code are effective and relevant by keeping the Code under review and enquiring into market practice and recommending amendments to the Code and the Act as necessary.

Impact:
Improvements in the efficiency of the Code through the making of recommendations to the Minister of Commerce to achieve changes to the Code and takeovers law more generally.

Activities and actions to include:

• reviewing the provisions of takeovers law;
• identifying areas of the Code which require correction or would benefit from improvement;
• reviewing the practices relating to the takeover of Code companies;
• developing policy papers, guidance notes and practice notes on issues arising under the Code and its administration;
• supporting implementation of the recommendations to the Minister of Commerce, on the interaction between the provisions of company law and takeovers law as they apply to schemes of arrangement and amalgamations effected under parts 13 and 15 of the Companies Act 1993;
• developing proposals for public comment on proposed recommendations to the Minister, as necessary;
• making recommendations to the Minister for changes to that law, where appropriate.

Planned performance standards and performance measures for 2008/2009 (Forecast outcome for 2007/2008 in brackets):

OUTPUT 2: Approvals:

The approval of the appointment of independent advisers, where required under Rules 18, 21 or 22 of the Code or by the terms of an exemption granted, and the appointment of independent experts where required by Rule 57 of the Code.

Impact:
The improvement in the quality of advice and independent adviser reports to recipients of takeover offers and to shareholders entitled to vote to approve Code-related allotments and acquisitions.

Activities and actions to include:

• processing applications from advisers for approvals under the Code;
• ensuring that appointed advisers are both independent and competent to do the job required;
• assessing, where necessary, previous work of advisers to determine their experience and competence;
• reviewing draft independent advisers' reports and making suggestions for improvement;
• meeting with advisers on an ongoing basis to discuss and obtain feedback on any issues and concerns;
• appointing independent experts where required under the compulsory acquisition provisions of the Code;
• processing applications for consent to withdraw offers, and in relation to approval of defensive tactics.

Planned performance standards and performance measures for 2008/2009³ (Forecast outcome for 2007/2008 in brackets):

OUTPUT 3: Exemptions:

The granting of individual and class exemptions for Code events where relief from the Code's requirements is appropriate and consistent with the purpose, intent and objectives of the Code.

Impact:
The improvement in the functioning of the Code as the regulatory mechanism for corporate takeovers and the improvement in the functioning of the market by removing impediments in the Code or by providing a framework within which transactions can be undertaken.

Activities and actions to include:

• considering applications for individual exemptions from the Code;
• considering applications for class exemptions from the Code;
• issuing exemption notices for individual exemptions;
• issuing exemption notices for class exemptions;
• gazetting the exemption notices;
• publishing guidance notes to explain the policies being applied by the Panel in relation to various types of exemption.

Planned performance standards and performance measures for 2008/2009⁴ (Forecast outcome for 2007/2008 in brackets):

OUTPUT 4: Enforcement:

Maintaining oversight of takeover activity in the market by reviewing documentation, intervening where necessary in accordance with the Panel's statutory powers, investigating any possible breaches of the Code in accordance with the law and the rules of natural justice.

Impact:
The improvement in the standard of compliance with the Takeovers Code and facilitation of the operation of the takeovers market.

Activities and actions to include:

• reviewing all main takeover offer documents;
• reviewing Code-related meeting documents;
• convening formal meetings to exercise the Panel's enforcement powers under sections 32 and 35 of the Code;
• making applications to the Court to seek orders from the Courts, as necessary;
• investigating possible Code breaches;
• investigating complaints by shareholders and other principal parties to a transaction;
• monitoring NZX company announcements, media and other public information for transactions with Code implications;
• accepting enforceable undertakings from a party or parties in breach of the Code;
• issuing determinations and Panel decisions;
• seeking to be heard in Court proceedings involving the change of control of Code companies being effected through the scheme of arrangement provisions of the Companies Act.

Planned performance standards and performance measures for 2008/2009⁵ (Forecast outcome for 2007/2008 in brackets):

OUTPUT 5: Public Understanding:

Regularly publish information about the Code and relevant law, media statements, policy statements, guidance notes and commentaries on current issues, public meetings, and speeches. Respond to public enquiries.

Impact:
The improvement in public understanding of takeovers law over time, in particular, the improvement in the public's knowledge of the provisions of the Code.

Activities and actions to include:

• publishing the Panel's occasional newsletter, Code Word to explain changes to the Code and the Act and key Panel enforcement and exemption decisions;
• publishing practice notes and guidance notes to inform the market about the Panel's decisions and policies, to assist market participants to relate to the Panel and to explain how the Panel interprets various rules of the Code;
• improving the market's understanding of takeover matters and Panel activities through public speeches about the Code at relevant conferences and other meetings;
• receiving feedback from market participants about the Panel's performance through meetings with market participants to both gauge the effectiveness of the Panel in dealing with its stakeholders and to explain issues which have arisen;
• obtain direct feedback from the most active legal and advisory firms;
• holding group meetings with other interested market participants;
• maintaining a website that is kept up-to-date with all Panel decisions, news releases, speeches, discussion papers, practice notes;
• communicating with affected shareholders through telephone and correspondence explaining the application of the Code in particular circumstances;
• assisting the media with background information to ensure that the public receives accurate reports on issues of public interest.

Planned performance standards and performance measures for 2008/2009⁵ (Forecast outcome for 2007/2008 in brackets):

OUTPUT 6: International Liaison:

To enhance and improve co-operation and liaison with overseas takeovers regulators on matters of mutual interest.

Impact:
The improvement in the level of co-operation, liaison and understanding between the Panel and other international takeovers regulators.

Activities and actions to include:

• continuing the high level of contact with the Australian Takeovers Panel through the Panel Chairman's membership on the Australian Panel and membership of the New Zealand Panel by a member of the Australian Panel;
• continuing to maintain the good working relationships with the relevant staff of the Australian Panel and of the Australian Securities and Investments Commission by members of the Panel and executive;
• continuing to support the promotion of the informal group of international takeovers regulators by attending the group's conferences and planning to host a conference in New Zealand in 2010;
• co-operating, on request, with overseas takeovers regulators on various regulatory matters within the Panel's powers.

Planned performance standards and performance measures for 2008/2009⁵ (Forecast outcome for 2007/2008 in brackets):

Footnotes

3. Although characterised as "planned", the number of approval applications is similar to those for the current year but the final outcome is dependent on the level of market activity
4. Although characterised as "planned", the number of exemption applications is similar to those for the current year but the final outcome is dependent on the level of market activity
5. Although described as "planned", the number of offer documents and meeting documents reviewed by the Panel is similar to those for the current year but the outcome is dependent on the level of market activity

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