Pharmacy Ownership in Tasmania


Please note that the information contained in the Authority's web pages is for general information only and does not constitute financial or legal advice. The information has been prepared without reference to the particular needs of your pharmacy or ownership structures. Applicants should not construe any information as legal advice. The Authority recommends that each pharmacist should seek professional financial, legal and taxation advice before making decisions in relation to their pharmacy business premises and ownership structures.

The Pharmacy Control Act 2001 (the Act) regulates pharmacy business ownership in Tasmania. Please be aware that the Act was amended on 1 January 2017, and ensure that any advice you obtain from lawyers or accountants is based on the up to date legislation.

Eligibility Certificates (ECs)
A person, including a body corporate (a Pty Ltd company), who intends to hold an interest in a pharmacy business must apply to the Authority for an "Eligibility Certificate" (EC). The EC is like an annual license which confirms the holder's eligibility to have an interest in a pharmacy business; it can cover up to four businesses if all the interests are held in the name of the holder of that EC.

Section 65 of the Act mandates that a person, including a body corporate, must not, at any one time, either alone or in partnership with an other person, or as a member of a body corporate, hold an interest in more than four pharmacy businesses in Tasmania.

Who are Eligibility Certificates issued to?
An Eligibility Certificate which is issued to a body corporate or individual as trustee for (ATF) a trust does not constitute that body corporate or individual having its own EC. That is, interests in a pharmacy can be held by:
- an individual
- an individual ATF a trust
- a body corporate (a Pty Ltd company)
- a body corporate ATF a trust
and these are four different ECs.

Section 61D of the Act provides for an exemption from applying for an EC if the exempt person satisfies the provisions of any of subclauses (a) to (e) of s61D. However, exempt persons must still apply and be approved as eligible to hold an interest in a pharmacy business when they first seek to hold an interest in a pharmacy. If the Authority determines that they are exempt and need not hold their own EC, they would be required to provide an Annual Declaration about their structures and membership to ensure ongoing compliance.

Determinations about Eligibility Certificates

The determination of who needs to hold an EC, who would be exempt and who needs to provide an Annual Declaration is made by the Authority. In order to assist pharmacy owners to understand this aspect of the Act, the attached Eligibility Certificates, Exemptions and Annual Renewals Diagram, provides examples of different ownership scenarios for a number of pharmacies and explains what Eligibility Certificates, exemptions and Annual Declarations would be required. This is not intended to provide legal advice, but illustrates the complexities of ownership and the issuing of ECs.

ECs must be renewed each year before 30 June (refer to the Annual Renewals tab for more information) and body corporates or trusts who have been determined by the Authority to be exempt persons need to provide an Annual Declaration to confirm that they continue to operate within the requirements of the Act.

Definitions
"Pharmacist" is taken to mean a person who holds general registration under the Health Practitioner Regulation National Law (Tasmania) in the pharmacy profession (Section 3 of the Act).

The term "related parties" has been replaced with the term "close relative" in the amendments to the Act which came into effect on 1 January 2017 - see s61A(3).

Close relative is defined as:

(a) the spouse of the pharmacist; or
(b) the son, daughter, grandson or granddaughter of the pharmacist; or
(c) any child of the spouse of the pharmacist, of whom the pharmacist is not the natural parent; or
(d) the father, stepfather, mother or stepmother of the pharmacist; or
(e) the brother, step-brother, sister or step-sister of the pharmacist.
"Spouse" includes any person who is in a significant relationship with the pharmacist, within the meaning of the Relationships Act 2003 (section 61A of the Act).


Pharmacy Ownership
Pharmacies can be owned by:

  1. An individual who is a pharmacist
  2. A partnership where all partners are registered pharmacists
  3. A body corporate where each director must be a registered pharmacist and the controlling interest (i.e. more than 50% of the voting shares) is held by one or more registered pharmacists; and all the other members of the body corporate are close relatives or the spouse of the pharmacist(s). NB: A shareholder in a body corporate cannot be another body corporate. Shareholders can only be registered pharmacists or close relatives (as defined above).
  4. An individual or a body corporate as trustee for a discretionary trust, provided that beneficiaries are limited to the registered pharmacist and/or their close relatives (as defined above) and the trustee is either a registered pharmacist or a body corporate which complies with the Act. Please note that a body corporate CANNOT be a beneficiary, even if it is the trustee; nor can the trust deed make provision for broader classes of beneficiaries than those prescribed by the Act (pharmacists and their close relatives). A trust deed which names specific beneficiaries (who comply with the Act) but makes provision for other (broader) classes of beneficiaries to be added would not comply when those other classes are not limited to pharmacists or their close relatives. This therefore excludes as actual or potential beneficiaries body corporates, charitable trusts, educational bodies, another trustee/trust, business partners who are not registered pharmacists, etc.
  5. An individual or a body corporate as trustee for a unit trust, provided that all unit holders must be registered pharmacists or close relatives (as defined above) and the trustee is either a registered pharmacist or a body corporate which complies with the Act. Please note that a body corporate CANNOT be a beneficiary, even if it is the trustee.

Changing Ownership of a Pharmacy

An application for approval of the change of ownership of a pharmacy business must be lodged with the Tasmanian Pharmacy Authority on Form CO - Application for Approval of Change of Ownership of Pharmacy. (Note that the Australian Community Pharmacy Authority requires confirmation that the Tasmanian Pharmacy Authority has approved the ownership change before it will issue an approval number.)

If ownership is to include a corporate body or trust which does not currently have an interest in a pharmacy, an application for their approval and the issuing of relevant ECs must be made to the Tasmanian Pharmacy Authority on the appropriate forms, and the relevant fee paid. The Authority will invoice the applicants for the fee if the application is lodged without payment, which is the preferred approach, as fees vary depending on the number of trusts and body corporate involved.

If the buyers of the pharmacy already have an EC or have been deemed exempt from needing one by the Authority, they may be exempt for this new pharmacy, although this will depend on the particular ownership structure of the new pharmacy and who the holding entity or entities will be. Queries about such matters should be directed to the Registrar.

The Authority will require the following documentation, with forms available from the links below:

  1. an application for an Eligibility Certificate for an individual (Form ECI) or body corporate (Form ABC) as relevant;
  2. if an individual is holding the interest as trustee for a trust: an application for approval of that trust (Form AAT) and a copy of the trust deed are also required;
  3. for a body corporate: Form ABC and a copy of the Company's Constitution or other governing documents;
  4. if the body corporate owns the pharmacy business in its capacity as the trustee of a trust, or if any shares in the body corporate are held in trust: an application for approval of the trust (Form AAT) and a copy of the trust deed are also required for each trust;
  5. if the ownership structure is to involve trusts and body corporate(s), which can have complex interrelationships, please provide a diagram which clearly shows all the entities, each pharmacist, and the reporting and ownership relationships;
  6. an application for the approval of the change of ownership of the pharmacy (Form CO).
  7. a cheque or direct deposit for the Scheduled Fee, but as this will vary depending on whether the applicant is an individual or a body corporate and whether or not there are trust(s) associated with the ownership structure, the Authority is happy to invoice you on receipt of your application;

What if a Body Corporate or Trust is changed after it has been approved by the Authority?

The Authority must be kept informed of any changes to Trusts, trustees or Body Corporates within 14 days.

Application must be made to the Authority for approval of any changes to a trust's beneficiaries, unit holders or to the trustee. Please use Form CT Change to a Trust, which is available below. The formal deed of variation which changes the Trust Deed will need to be submitted as well.

Similarly, any proposed changes to a body corporate (Pty Ltd company) - to its directors, its shareholders or to the number of shares held by each shareholder - must be approved by the Authority. Form CBC (available below) should be used to apply for approval of changes to a body corporate.


FORMS

The Authority prefers to work from electronic (scanned) versions of your applications being emailed to the Registrar, although it asks that hard copies of large documents such as trust deeds and constitutions also be posted to the Authority at PO Box 1082 Sandy Bay, Tasmania 7005.

Fees From 24 April 2013, the Authority's fees are expressed in terms of Fee Units, rather than a dollar amount, due to the approval of the Pharmacy Control (Fees) Amendment Regulations 2013.

Fee Units provide for the automatic indexation of fees in line with movements in the Consumer Price Index for Hobart (CPI). This indexation ensures that the Authority is able to recover increases in the cost of providing services through corresponding increases in the fees it charges to provide those services. More information about Fee Units can be found at the Department of Treasury and Finance Fee Units webpage.

Click here for a List of Fee Units and their corresponding $ fee values.



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