Superannuation Industry (Supervision) Act 1993

Act No. 78 of 1993 as amended

This compilation was prepared on 5 July 2005
taking into account amendments up to Act No. 82 of 2005

The text of any of those amendments not in force
on that date is appended in the Notes section

The operation of amendments that have been incorporated may be affected by application provisions that are set out in the Notes section

Prepared by the Office of Legislative Drafting and Publishing,
Attorney‑General’s Department, Canberra

  

  

  

Contents

Part 1—Preliminary                                                                                                               1

Division 1—Preliminary                                                                                              1

1............ Short title [see Note 1]....................................................................... 1

2............ Commencement [see Note 1].............................................................. 1

3............ Object of Act...................................................................................... 1

4............ Summary of provisions...................................................................... 2

6............ General administration of Act............................................................ 3

7............ Application of Act not to be excluded or modified............................ 6

8............ Act extends to external Territories..................................................... 6

9............ Crown to be bound............................................................................. 7

9A......... Application of the Criminal Code...................................................... 7

Division 2—Interpretation                                                                                         8

10.......... Definitions.......................................................................................... 8

10A....... Interdependency relationship........................................................... 26

11.......... Approvals, determinations etc. by Regulator................................... 27

11A....... Approved forms............................................................................... 27

11B....... Electronic lodgment of approved forms........................................... 28

11C....... Declaration required if approved form lodged electronically on trustee’s behalf    29

11D....... Electronic lodgment—documents other than approved forms......... 30

11E........ Approved guarantees........................................................................ 30

12.......... Associates......................................................................................... 30

13.......... Single trustees................................................................................... 31

13A....... RSE licensees that are groups of individual trustees........................ 31

14.......... Indefinitely continuing fund—application of rules against perpetuities 32

15.......... Approved deposit funds—payments by trustees........................... 33

15A....... Definitions of employee and employer.............................................. 33

15B....... Modified meaning of member........................................................... 35

16.......... Definitions associated with employer‑sponsorship......................... 35

17A....... Definition of self managed superannuation fund.............................. 36

18.......... Public offer superannuation fund..................................................... 40

19.......... Regulated superannuation fund........................................................ 42

20.......... Related bodies corporate.................................................................. 45

20A....... Resident approved deposit funds..................................................... 45

Part 2—Approval of trustees                                                                                          47

21.......... Object of Part................................................................................... 47

22.......... Interpretation.................................................................................... 47

23.......... Application for approval.................................................................. 48

24.......... Further information may be requested............................................. 48

25.......... Period within which application for approval is to be decided........ 48

26.......... Deciding an application for approval............................................... 49

27.......... When an approval is in force............................................................ 50

27A....... Application for variation of an approval.......................................... 51

27B....... An application must be decided within a period of time.................. 51

27C....... APRA may vary an approval on its own initiative.......................... 52

27D....... Notifying the trustee of the outcome of an application................... 52

27E........ When a variation of approval comes into force................................ 53

28.......... Revocation of approval.................................................................... 53

29.......... Notification of change in circumstances or breach of conditions...... 54

Part 2A—Licensing of trustees and groups of individual trustees            55

Division 1—Object of this Part                                                                              55

29A....... Object of this Part and the relationship of this Part to other provisions                55

Division 2—Classes of RSE licences                                                                 57

29B....... Classes of RSE licences.................................................................... 57

Division 3—Applying for RSE licences                                                             59

29C....... Applications for RSE licences.......................................................... 59

29CA.... APRA may request further information........................................... 61

29CB..... Period etc. for deciding applications from existing trustees in licensing transition period      61

29CC..... Period for deciding other applications.............................................. 62

Division 4—Grant of RSE licences                                                                      64

29D....... Grant of RSE licences....................................................................... 64

29DA.... Capital requirements......................................................................... 65

29DB.... Licence numbers etc.......................................................................... 66

29DC.... Documents required to bear licence numbers................................... 67

29DD.... Licence period................................................................................... 67

29DE..... APRA to give notice of refusal of applications................................ 68

Division 5—Conditions on RSE licences                                                         69

29E........ Conditions imposed on all licences and on groups of licences......... 69

29EA..... Additional conditions imposed on individual licences by APRA.... 71

29EB..... Directions to comply with licence conditions.................................. 73

Division 6—Varying RSE licences                                                                       74

29F........ Applications for variation of RSE licences....................................... 74

29FA..... APRA may request further information........................................... 74

29FB..... Period for deciding applications....................................................... 75

29FC..... APRA may vary RSE licences in accordance with applications...... 75

29FD..... APRA may vary or revoke licence conditions on its own initiative 76

29FE..... Notification of APRA’s decisions under this Division.................... 77

29FF..... When variations or revocations come into force etc......................... 78

Division 7—Cancelling RSE licences                                                                79

29G....... Cancellation of RSE licences............................................................. 79

29GA.... Cancellation of RSE licences of financial services licensees............. 79

29GB.... APRA may allow RSE licence to continue in effect......................... 80

Division 8—Risk management strategies                                                       81

Subdivision A—Contents of risk management strategies                                81

29H....... Contents of risk management strategies........................................... 81

Subdivision B—Maintaining and reviewing risk management strategies     82

29HA.... Requirement to maintain and review risk management strategies..... 82

29HB.... Modifications etc. to risk management strategies............................. 83

29HC.... Notification of modifications etc. to risk management strategies..... 83

Subdivision C—Miscellaneous                                                                               84

29HD.... APRA to be given information......................................................... 84

Division 9—Offences and self‑incrimination                                                  86

29J........ Being trustee of a registrable superannuation entity while unlicensed etc.              86

29JA..... Failing to notify breach of licence condition..................................... 87

29JB...... Not complying with direction to comply with licence conditions... 88

29JC...... Not complying with direction to modify risk management strategy 88

29JD..... Breach does not affect validity of issue of superannuation interests etc.                89

29JE...... Self incrimination.............................................................................. 89

Part 2B—Registrable superannuation entities                                                    90

Division 1—Object of this Part                                                                              90

29K....... Object etc. of this Part...................................................................... 90

Division 2—Applying for registration                                                                91

29L........ Applications for registration............................................................ 91

29LA..... APRA may request further information........................................... 93

29LB..... Period for deciding applications for registration............................... 93

Division 3—Registration                                                                                          95

29M...... Registration of registrable superannuation entity............................. 95

29MA... Registration numbers etc.................................................................. 95

29MB... Documents required to bear registration numbers............................ 95

29MC... APRA to give notice of refusal of applications................................ 96

Division 4—Cancelling registration                                                                    97

29N....... Cancelling registration....................................................................... 97

Division 5—Risk management plans                                                                 98

Subdivision A—Contents of risk management plans                                         98

29P........ Contents of risk management plans.................................................. 98

Subdivision B—Maintaining and reviewing risk management plans             99

29PA..... Requirement to maintain and review risk management plans........... 99

29PB..... Modifications etc. to risk management plans................................... 99

29PC..... Notification of modifications etc. to risk management plans......... 100

Subdivision C—Miscellaneous                                                                             101

29PD..... Access to risk management plans................................................... 101

29PE..... APRA to be given information....................................................... 102

Division 6—Offences and self‑incrimination                                                103

29Q....... Not complying with direction to modify risk management plan.... 103

29QA.... Breach does not affect validity of issue of superannuation interests etc.                103

29QB.... Self incrimination............................................................................ 103

Part 3—Operating standards                                                                                        105

30.......... Object of Part................................................................................. 105

31.......... Operating standards for regulated superannuation funds............... 105

32.......... Operating standards for approved deposit funds........................... 106

33.......... Operating standards for pooled superannuation trusts.................. 107

34.......... Prescribed operating standards must be complied with................. 108

Part 4—Trustee of superannuation entity to lodge annual returns with the Regulator      109

35.......... Object of Part................................................................................. 109

36.......... Trustee to give copy of audit report to APRA.............................. 109

36A....... Trustee of self managed superannuation fund to lodge annual returns 110

Part 5—Notices about complying fund status                                                     112

Division 1—Objects and interpretation                                                          112

37.......... Objects of Part................................................................................ 112

38.......... Meaning of entity............................................................................ 112

Division 2—The Regulator may give notices about complying fund status         113

38A....... Meaning of regulatory provision.................................................... 113

39.......... Meaning of contravention............................................................... 113

40.......... Notices by the Regulator to trustee................................................ 114

41.......... When the Regulator obliged to give notice of compliance.............. 115

42.......... Complying superannuation fund.................................................... 116

42A....... Complying superannuation fund—fund that has been a self managed superannuation fund at any time during a year........................................................................................................ 121

43.......... Complying approved deposit fund................................................ 126

44.......... Pooled superannuation trust........................................................... 127

Division 3—Complying fund status for tax purposes                              129

45.......... Complying superannuation fund.................................................... 129

46.......... Complying superannuation scheme—superannuation guarantee charge 130

47.......... Complying approved deposit fund................................................ 130

48.......... Pooled superannuation trust........................................................... 131

49.......... Transitional—notices under the repealed provisions of the Occupational Superannuation Standards Act 1987   132

50.......... Transitional—late lodgment of elections by trustees of superannuation funds      134

Part 6—Provisions relating to governing rules of superannuation entities                137

51.......... Object of Part................................................................................. 137

52.......... Covenants to be included in governing rules................................... 137

53.......... Covenants to repay amounts to beneficiaries in approved deposit funds               140

54.......... Prerequisites to variation of repayment period.............................. 141

55.......... Consequences of contravention of covenant.................................. 141

56.......... Indemnification of trustee from assets of entity............................ 142

57.......... Indemnification of directors of trustee from assets of entity......... 143

58.......... Trustee not to be subject to direction............................................. 143

59.......... Exercise of discretion by person other than trustee....................... 144

60.......... Amendment of governing rules....................................................... 145

60A....... Dismissal of trustee of public offer entity..................................... 146

Part 7—Provisions applying only to regulated superannuation funds   147

61.......... Object of Part................................................................................. 147

62.......... Sole purpose test............................................................................ 147

63.......... Certain regulated superannuation funds not to accept employer contributions in certain circumstances               149

64.......... Superannuation contributions—deductions from salary or wages to be remitted promptly  153

64A....... Compliance with determinations of the Superannuation Complaints Tribunal       154

65.......... Lending to members of regulated superannuation fund prohibited 154

66.......... Acquisitions of certain assets from members of regulated superannuation funds prohibited 156

67.......... Borrowing....................................................................................... 159

68.......... Victimisation of trustees etc........................................................... 162

68A....... Conduct relating to fund membership............................................ 165

Part 8—In‑house asset rules applying to regulated superannuation funds                167

Division 1—Object and interpretation                                                            167

Subdivision A—General                                                                                         167

69.......... Object of Part................................................................................. 167

69A....... Sub‑funds to be treated as funds.................................................... 167

70A....... The Regulator may determine a person to be a standard employer‑sponsor          167

Subdivision B—Part 8 associates                                                                        168

70B....... Part 8 associates of individuals....................................................... 168

70C....... Part 8 associates of companies....................................................... 168

70D....... Part 8 associates of partnerships.................................................... 169

70E........ Meanings of terms used in sections 70B, 70C and 70D................. 170

Subdivision C—In‑house assets                                                                           171

71.......... Meaning of in‑house asset.............................................................. 171

Subdivision D—Transitional arrangements in relation to in‑house assets 175

71A....... Exceptions—pre‑11 August 1999 investments and loans.............. 175

71B....... Exceptions—pre‑11 August 1999 leases and lease arrangements.. 176

71C....... Exceptions—transition period........................................................ 177

71D....... Exception—reinvestments.............................................................. 178

71E........ Exception—certain geared investments.......................................... 179

71F........ Meaning of certain terms used in Subdivision D............................ 181

Subdivision E—Other provisions in relation to in‑house assets                    182

72.......... How this Part applies if there are 2 or more employer‑sponsors of whom at least one is an unrelated employer‑sponsor.......................................................................... 182

73.......... Cost of in‑house asset.................................................................... 183

74.......... Historical cost ratio of fund’s in‑house assets............................... 184

75.......... Market value ratio of fund’s in‑house assets................................. 184

Division 2—Historical cost ratio of fund’s in‑house assets                 185

76.......... Private sector funds established on or after 12 March 1985—historical cost ratio for the 1994‑95 year of income........................................................................................................ 185

77.......... Private sector funds established before 12 March 1985—historical cost ratio for the 1994‑95 year of income     185

78.......... Public sector funds established on or after 1 July 1990—historical cost ratio for the 1994‑95 year of income     185

79.......... Public sector funds established before 1 July 1990—historical cost ratio for the 1994‑95 year of income            186

80.......... All funds—historical cost ratio for the 1995‑96 year of income, the 1996‑97 year of income and the 1997‑98 year of income............................................................................................. 186

Division 3—Market value ratio of fund’s in‑house assets                   187

80A....... Division not applicable to certain funds......................................... 187

81.......... All funds—market value ratio for the 1998‑99 year of income and the 1999‑2000 year of income       187

82.......... All funds—market value ratio for the 2000‑2001 year of income and later years of income  187

83.......... Certain new in‑house asset investments prohibited....................... 188

Division 3A—Limit on in‑house assets of certain defined benefit funds              189

83A....... Definitions...................................................................................... 189

83B....... Application of Division.................................................................. 190

83C....... Maximum permitted market value of in‑house assets.................... 191

83D....... Limit on in‑house assets................................................................. 191

83E........ Acquisition of in‑house assets prohibited in certain circumstances 192

Division 4—Enforcement                                                                                       193

84.......... In‑house asset rules must be complied with................................... 193

Division 5—Anti‑avoidance                                                                                   194

85.......... Prohibition of avoidance schemes................................................... 194

Part 9—Equal representation of employers and members—employer‑sponsored funds  195

86.......... Object of Part................................................................................. 195

87.......... Consequences of non‑compliance with this Part............................ 195

88.......... This Part does not apply if acting trustee appointed under Part 17 195

89.......... Basic equal representation rules..................................................... 195

90.......... Pre‑1 July 1995 rules—funds with fewer than 200 members........ 197

91.......... Pre‑1 July 1995 rules—funds with 200 or more members............. 198

92.......... Post‑30 June 1995 rules—funds with more than 4, but fewer than 50, members   199

93.......... Post‑30 June 1995 rules—funds with more than 49 members....... 202

93A....... A trustee who is an employer‑sponsor of a fund may still be an independent trustee           203

Part 10—Provisions applying only to approved deposit funds                  205

94.......... Object of Part................................................................................. 205

95.......... Borrowing....................................................................................... 205

Part 11—Provisions applying only to pooled superannuation trusts      207

96.......... Object of Part................................................................................. 207

97.......... Borrowing....................................................................................... 207

98.......... Lending to unit‑holders prohibited................................................. 208

99.......... Civil penalty provisions................................................................. 208

Part 12—Duties of trustees and investment managers of superannuation entities              209

100........ Object of Part................................................................................. 209

101........ Duty to establish arrangements for dealing with inquiries or complaints                209

102........ Duty to seek information from investment manager...................... 210

103........ Duty to keep minutes and records................................................. 211

104........ Duty to keep records of changes of trustees.................................. 212

105........ Duty to keep reports...................................................................... 212

106........ Duty to notify the Regulator of significant adverse events............ 213

106A..... Duty to notify Commissioner of Taxation of change in status of entity                213

107........ Duty of trustee of employer‑sponsored fund to establish procedure for appointing member representatives      214

108........ Duty of trustee of employer‑sponsored fund to establish procedure for appointing independent trustee or independent member of board of directors of corporate trustee......................... 215

109........ Investments of superannuation entity to be made and maintained on arm’s length basis       216

Part 13—Accounts, statements and audits of superannuation entities 218

110........ Object of Part................................................................................. 218

111........ Accounting records......................................................................... 218

112........ Accounts and statements................................................................ 219

113........ Audit of accounts and statements.................................................. 220

Part 14—Other provisions applying to superannuation entities               223

114........ Object of Part................................................................................. 223

115........ Trustee of superannuation entity may maintain reserves.............. 223

116........ Agreement between trustee and investment manager..................... 223

117........ Circumstances in which amounts may be paid out of an employer‑sponsored fund to an employer‑sponsor      223

118........ Consents to appointments............................................................. 228

Part 15—Standards for trustees, custodians and investment managers of superannuation entities           229

119........ Object of Part................................................................................. 229

120........ Disqualified persons....................................................................... 229

120A..... The Regulator may disqualify individuals...................................... 230

121........ Disqualified persons not to be trustees of superannuation entities 231

121A..... Certain persons not to be trustees of certain small funds.............. 232

122........ Investment manager must not appoint or engage custodian without the trustee’s consent    233

123........ Persons who may be appointed to be custodians of superannuation entities         233

124........ Investment managers must be appointed in writing....................... 235

125........ Individuals not to be investment managers of superannuation entities 235

126........ Disqualified persons not to be investment managers of superannuation entities    235

126A..... Disqualified persons not to be custodians of superannuation entities 236

126B..... Application for waiver of disqualified status................................. 236

126C..... Application must be decided within a period of time.................... 238

126D..... Notifying of the outcome of an application................................... 238

126E...... The effect of seeking a waiver of disqualified person status.......... 240

126F...... The Regulator’s powers to seek further material........................... 241

127........ Non‑compliance not to invalidate appointment or transaction...... 242

Part 16—Actuaries and auditors of superannuation entities                      243

128........ Object of Part................................................................................. 243

129........ Obligations of actuaries and auditors—compliance........................ 243

130........ Obligations of actuaries and auditors—solvency........................... 245

130A..... Auditor or actuary may give information to the Regulator............ 247

130B..... Self incrimination............................................................................ 248

130C..... Actuaries and auditors—failure to implement actuarial recommendations              248

131........ Auditors—disqualification orders.................................................. 251

131A..... The Regulator may refer matters to a professional association...... 253

131B..... Offence of holding oneself out as an actuary or auditor................. 254

Part 17—Suspension or removal of trustee of superannuation entity  255

132........ Object of Part................................................................................. 255

133........ Suspension or removal of trustee of superannuation entity........... 255

134........ APRA to appoint acting trustee in cases of suspension or removal 256

135........ Terms and conditions of appointment of acting trustee................. 257

136........ Termination of appointment of acting trustee................................ 257

137........ Resignation of acting trustee........................................................... 257

138........ Property vesting orders.................................................................. 258

139........ Powers of acting trustee................................................................. 259

140........ Acting trustee to notify appointment to beneficiaries................... 259

141........ The Regulator may give directions to acting trustee....................... 259

141A..... Property vested in acting trustee—former trustee’s obligations relating to books, identification of property and transfer of property........................................................................ 260

142........ The Regulator may formulate a scheme for the winding‑up or dissolution, or both, of a superannuation entity   261

Part 18—Amalgamation of funds                                                                               263

143........ Object of Part................................................................................. 263

144........ Benefits may be transferred to a new fund with APRA’s approval etc. 263

145........ Application for approval of transfer.............................................. 263

146........ Approval of transfer....................................................................... 264

147........ Cessation of rights against transferor fund..................................... 265

Part 19—Public offer entities: provisions relating to superannuation interests      266

Division 1—Preliminary                                                                                          266

151........ Contravention of Part does not affect validity of issue of superannuation interest etc.         266

Division 2—Issuing, offering etc. superannuation interests in public offer entities       267

152........ Limitation on issuing, offering etc. superannuation interests in public offer entities              267

153A..... ........................................................................................................ 268

154........ Commission and brokerage............................................................. 268

155........ Fair dealing on issue or redemption of a superannuation interest.. 269

156........ Civil liability where subsection 155(2) contravened...................... 270

Part 21—Civil and criminal consequences of contravening civil penalty provisions            271

Division 1—Preliminary                                                                                          271

192........ Object of Part................................................................................. 271

193........ Civil penalty provisions................................................................. 271

194........ Person involved in contravening a provision taken to have contravened the provision          271

195........ When a court is taken to find a person guilty of an offence........... 271

Division 2—Civil penalty orders                                                                        273

196........ Court may make civil penalty orders............................................. 273

197........ Who may apply for civil penalty order.......................................... 273

198........ Time limit for application............................................................... 274

199........ Application for civil penalty order is a civil proceeding................ 274

200........ Enforcement of order to pay monetary penalty............................. 274

201........ The Regulator may require a person to give assistance in connection with application for civil penalty order      274

Division 3—Criminal proceedings                                                                     276

202........ When contravention of civil penalty provisions is an offence....... 276

203........ Application for civil penalty order precludes later criminal proceedings                276

Division 4—Effect of criminal proceedings on application for civil penalty order            277

204........ When Division applies................................................................... 277

205........ Effect during criminal proceedings.................................................. 277

206........ Final outcome precluding applications for civil penalty order....... 277

207........ Final outcome not precluding application for civil penalty order.. 278

208........ After unsuccessful committal proceeding, court may preclude application for civil penalty order        278

209........ Application for civil penalty order based on alternative verdict at jury trial          279

210........ Application for civil penalty order based on alternative finding by court of summary jurisdiction       280

211........ Application for civil penalty order based on alternative finding by appeal court   280

212........ After setting aside declaration, court may preclude application for civil penalty order          281

213........ On unsuccessful appeal against declaration, Court may make civil penalty orders                281

214........ Appeals under this Division........................................................... 281

Division 5—Compensation for loss suffered by superannuation entity 282

215........ On application for civil penalty order, Court may order compensation 282

216........ Criminal court may order compensation........................................ 282

217........ Enforcement of order under section 215 or 216............................. 283

218........ Recovery of profits, and compensation for loss, resulting from contravention      283

219........ Effect of sections 215, 216 and 218............................................... 284

220........ Certificates evidencing contravention............................................. 284

Division 6—Miscellaneous                                                                                    285

221........ Relief from liability for contravention of civil penalty provision.. 285

222........ Part does not limit power to award punitive damages................... 286

Part 23—Financial assistance to certain funds                                                  287

Division 1—Preliminary                                                                                          287

227........ Object of Part................................................................................. 287

228........ Interpretation.................................................................................. 287

229........ Application for assistance.............................................................. 288

230........ Minister may request additional information................................. 289

230A..... APRA to advise Minister in relation to application for assistance 289

Division 2—Determination of applications for financial assistance  290

231........ Minister may grant financial assistance.......................................... 290

232........ Maximum amount of financial assistance....................................... 290

233........ Financial assistance to be subject to conditions............................. 290

Division 3—How financial assistance is to be paid                                   292

234........ Superannuation Protection Account............................................... 292

235........ Minister to decide the source from which financial assistance is to be paid           292

236........ Purposes of Account...................................................................... 292

237........ Separate notional accounts to be kept within the Account............ 293

238........ Financial assistance to be repaid in certain circumstances.............. 293

239........ Minister may remit liability........................................................... 294

240........ Repayable grant to have priority over other debts......................... 294

Part 24—Facility to pay benefits to eligible rollover funds                         295

241........ Object of Part................................................................................. 295

242........ Interpretation.................................................................................. 295

243........ Payment of benefits to eligible rollover fund.................................. 295

244........ Operating standards for transferor funds—information and records 297

248........ Claims for benefits ......................................................................... 298

Part 24A—Transitional provisions relating to pre‑1 July 1995 automatic rollovers of benefits between funds                                                                                                                        299

249........ Object of Part................................................................................. 299

250........ Definitions...................................................................................... 299

251........ Rights of beneficiary to rolled‑over benefits ................................. 300

252........ Claims to rolled‑over benefits......................................................... 300

Part 24B—Provisions relating to the administration by APRA and the Commissioner of Taxation of superannuation funds with fewer than 5 members                        301

Division 1—Monitoring of superannuation funds with fewer than 5 members  301

252A..... APRA or Commissioner of Taxation may request certain information.. 301

252B..... Contravention notices..................................................................... 302

Division 2—Secrecy provisions relating to Commissioner of Taxation                305

252C..... Secrecy—general obligations.......................................................... 305

Division 3—Transitional and savings provisions relating to the regulation of self managed superannuation funds by the Commissioner of Taxation 309

252D..... Definition........................................................................................ 309

252E...... Instruments made or issued by APRA or by the Commissioner of Taxation         309

252F...... Obligations owed by or to APRA or the Commissioner of Taxation 310

252G..... Outstanding annual returns and amounts....................................... 312

252H..... Regulations..................................................................................... 315

Part 25—Monitoring and investigating superannuation entities             316

Division 1—Preliminary                                                                                          316

253........ Objects of Part................................................................................ 316

253A..... Notices may be given to former relevant persons.......................... 316

Division 2—Monitoring superannuation entities                                      317

254........ Information to be given to Regulator.............................................. 317

255........ Regulator may require production of books................................... 318

256........ Access to premises......................................................................... 318

Division 3—APRA may require trustee of superannuation entity to appoint an individual, or a committee, to investigate the financial position of the entity             319

257........ Investigation of financial position of superannuation entity.......... 319

258........ Qualifications of investigator or investigators................................ 319

259........ APRA may veto appointment of investigator or investigators...... 319

260........ Deadline for receipt of report......................................................... 320

261........ Contents of report etc.................................................................... 321

262........ Trustee must comply with requirements....................................... 321

Division 3A—Regulator may accept and enforce undertakings        322

262A..... Acceptance and enforcement of undertakings................................ 322

Division 4—Investigations by Regulator                                                       323

263........ Investigation of superannuation entity........................................... 323

264........ Power of Regulator to obtain information or freeze assets............ 323

265........ Inspectors....................................................................................... 325

266........ Delegation by inspector.................................................................. 326

267........ Regulator may exercise powers of inspector.................................. 326

268........ Inspector may enter premises for purposes of an investigation.... 326

269........ Inspector may require production of books................................... 326

270........ Powers of inspector to require assistance from, and examine, current and former relevant persons and other persons........................................................................................................ 327

271........ Application for warrant to seize books not produced................... 327

272........ Grant of warrant............................................................................. 328

273........ Powers if books produced or seized............................................... 329

274........ Powers if books not produced........................................................ 331

275........ Power to require person to identify property of superannuation entity                331

Division 5—Examinations                                                                                      332

276........ Application of Division.................................................................. 332

277........ Requirements made of an examinee................................................ 332

278........ Examination to be in private........................................................... 332

279........ Examinee’s lawyer may attend....................................................... 333

280........ Record of examination.................................................................... 333

281........ Giving copies of record to other persons....................................... 333

282........ Copies given subject to conditions................................................. 334

283........ Record to accompany report.......................................................... 334

Division 6—Reports                                                                                                  336

284........ Report of inspector........................................................................ 336

Division 7—Offences                                                                                                337

285........ Compliance with requirements made under this Act...................... 337

286........ Concealing books relevant to investigation..................................... 337

287........ Self‑incrimination............................................................................ 337

288........ Legal professional privilege............................................................ 338

289........ Powers of Court where non‑compliance with this Act.................. 339

Division 8—Evidentiary use of certain material                                         341

290........ Statements made at an examination: proceedings against examinee 341

291........ Statements made at an examination: other proceedings.................. 342

292........ Weight of evidence admitted under section 291............................. 343

293........ Objection to admission of statements made at examination........... 344

294........ Copies of, or extracts from, certain books...................................... 345

295........ Report under Division 6................................................................. 345

296........ Exceptions to admissibility of report............................................. 346

297........ Material otherwise admissible........................................................ 347

Division 9—Miscellaneous                                                                                    348

298........ Regulator may cause civil proceeding to be begun.......................... 348

298A..... Authorisation of members of staff................................................. 348

299........ Person complying with requirement not to incur liability to another person          348

Part 25A—Tax file numbers                                                                                         349

Division 1—Quotation of employee’s tax file number                            349

299A..... Employee may quote to employer................................................. 349

299B..... Employer may inform trustee of tax file number........................... 349

299C..... Employer must inform trustee of tax file number.......................... 349

Division 2—Quotation, use and transfer of beneficiary’s tax file number            351

299D..... Eligible superannuation entity or regulated exempt public sector superannuation scheme beneficiary, or applicant, may quote tax file number...................................................................... 351

299E...... Trustee may request beneficiary’s or applicant’s tax file number. 351

299F...... Trustee must request person who is beneficiary at commencement to quote tax file number                351

299G..... Trustee must request person becoming beneficiary after commencement to quote tax file number        354

299H..... Use of tax file number for certain purposes—beneficiaries of eligible superannuation entities              355

299J...... Use of tax file number for certain purposes—beneficiaries of regulated exempt public sector superannuation scheme........................................................................................................ 356

299K..... Use of tax file number for certain purposes—applicants to become beneficiaries of eligible superannuation entities........................................................................................................ 358

299L...... Use of tax file number for certain purposes—applicants to become beneficiaries of regulated exempt public sector superannuation schemes................................................................. 359

299M.... Trustee of eligible superannuation entity must inform RSA provider or other trustee of tax file number for certain purposes......................................................................................... 361

299N..... Trustee of regulated exempt public sector superannuation scheme may inform RSA provider or other trustee of tax file number for certain purposes........................................................... 362

Division 3—Method of quotation of tax file numbers, including deemed quotation       364

299P...... Method of quoting tax file number................................................. 364

299Q..... Employee taken to have quoted to trustee where trustee informed by employer   364

299R..... Beneficiary or applicant taken to have quoted to RSA provider or trustee            364

299S...... Person claiming benefit taken to have quoted to trustee where he or she provided tax file number in connection with claim................................................................................................ 365

299T..... Beneficiary taken to have quoted if he or she quoted for other purposes               366

Division 4—Provision of tax file numbers in forms etc.                         367

299U..... Forms etc. may require tax file number.......................................... 367

299V..... Failure to quote tax file number...................................................... 368

Division 5—General                                                                                                  369

299W.... Definitions...................................................................................... 369

299X..... State insurance................................................................................ 370

299Y..... Trustee of former regulated exempt public sector superannuation scheme to destroy records of tax file numbers........................................................................................................ 370

299Z..... Transitional provisions................................................................... 370

Part 26—Offences relating to statements, records etc.                                373

300........ Object of Part................................................................................. 373

301........ Interpretation.................................................................................. 373

303........ Incorrectly keeping records etc....................................................... 373

306........ Incorrectly keeping or making records etc...................................... 374

307........ Incorrectly keeping records with intention of deceiving or misleading etc.             375

308........ Falsifying or concealing identity with intention of deceiving or misleading etc.      376

Part 27—Powers of Court                                                                                               377

309........ Object of Part................................................................................. 377

310........ Power to grant relief....................................................................... 377

311........ Power of Court to give directions with respect to meetings ordered by the Court 379

312........ Irregularities.................................................................................... 379

313........ Power of Court to prohibit payment or transfer of money or property 381

314........ Court may order the disclosure of information or the publication of advertisements—contravention of provisions relating to issue of superannuation interests etc............................. 386

315........ Injunctions...................................................................................... 387

316........ Effect of sections 313, 314 and 315............................................... 390

317........ Power of Court to punish for contempt of court........................... 390

318........ Court may resolve transitional difficulties..................................... 390

Part 28—Proceedings                                                                                                       391

319........ Object of Part................................................................................. 391

320........ Power of Regulator to intervene in proceedings............................. 391

321........ Civil proceedings not to be stayed................................................. 391

322........ Standard of proof............................................................................ 391

323........ Relief from civil liability for contravention of certain provisions.. 392

324........ Evidence of contravention.............................................................. 393

324A..... Time for instituting criminal proceedings....................................... 394

325........ Vesting of property........................................................................ 394

Part 29—Exemptions and modifications                                                                396

326........ Object of Part................................................................................. 396

327........ Interpretation.................................................................................. 396

328........ Regulator’s powers of exemption—modifiable provisions............ 396

330........ Regulator’s powers of exemption—general issues......................... 396

331........ Enforcement of conditions to which exemption is subject............. 397

332........ Regulator’s powers of modification—modifiable provisions......... 397

334........ Regulator’s powers of modification—general issues...................... 397

335........ Revocation of exemptions and modifications................................. 397

336........ Publication of exemptions and modifications etc........................... 397

Part 30—Miscellaneous                                                                                                  398

337........ Object of Part................................................................................. 398

337A..... Trustee may give effect to award made under arbitration agreement 398

338........ Conduct by directors, servants and agents..................................... 398

338A..... Liability of trustees required to ensure thing occurs...................... 400

339........ Conviction does not relieve defendant from civil liability.............. 401

341........ Civil immunity where defendant was complying with this Act..... 401

342........ Pre‑1 July 88 funding credits and debits........................................ 401

343........ Rules against perpetuities not to apply to superannuation entity. 403

344........ Review of certain decisions............................................................ 404

345........ Statements to accompany notification of decisions....................... 406

347........ How information may be given to the Commissioner of Taxation. 406

347A..... The Regulator may collect statistical information.......................... 406

348........ The Regulator may publish statistical information........................ 409

349........ This Act and the regulations to be subject to certain superannuation orders          409

349A..... Payment out of a fund in accordance with the Bankruptcy Act 1966 409

350........ Concurrent operation of State/Territory laws................................ 409

353........ Regulations..................................................................................... 410

Part 31—Transition to scheme provided for in this Act                                411

Division 1—Object of Part                                                                                     411

354........ Object of Part................................................................................. 411

Division 2—Entities that have a management company and a trustee   412

Subdivision A—General                                                                                         412

355........ Entity to which Division applies................................................... 412

356........ Interpretation.................................................................................. 413

Subdivision B—Existing management company may retire                            413

357........ Existing management company may give notice of retirement....... 413

358........ Effect of notice under section 357.................................................. 414

359........ Action to be taken by existing trustee on receipt of notice under section 357        415

360........ APRA to appoint new trustee if receives notice under subsection 359(2)             416

361........ Effect of notice under subsection 359(2)........................................ 416

362........ What happens if existing trustee fails to give a notice under subsection 359(2) or (3)           417

Subdivision C—Existing trustee may retire                                                      417

363........ Existing trustee may give notice of retirement................................ 417

364........ Action to be taken by existing management company on receipt of notice under section 363               418

365........ APRA to appoint new trustee....................................................... 419

366........ Effect of notice under section 363 on trustee................................. 419

367........ Effect of notice under section 363 on management company........ 420

368........ Notices under sections 363 and 364 have no effect except as provided in this Division        421

369........ What happens if existing management company fails to give a notice under subsection 364(2) or (3)   421

Subdivision D—What happens if existing management company or existing trustee stops holding office otherwise than under this Division                                                                    422

370........ Existing management company ceases to hold office first.............. 422

371........ Existing trustee ceases to hold office first...................................... 422

372........ Existing trustee cannot cease to hold office at same time as existing management company  423

Subdivision E—Special provisions in relation to the transitional period     424

373........ Interpretation.................................................................................. 424

374........ Existing trustee taken to be an approved trustee............................ 424

376........ Regulations may modify application of Act and apply provisions of the Corporations Law etc.         424

Subdivision F—Miscellaneous                                                                              426

377........ New trustee to notify appointment to members............................ 426

378........ Civil immunity for actions under Division..................................... 426

379........ Division has effect despite anything in any other Part of this Act etc... 426

Division 3—Regulations may make other transitional provisions   427

380........ Regulations may make other transitional provisions...................... 427

Part 32—Additional transitional provisions—tax file numbers                428

381........ Object of Part................................................................................. 428

382........ Quotation of tax file number........................................................... 428

383........ Pre‑1 July 1994 quotation of tax file number to be treated as if made under provisions commencing on 1 July 1994........................................................................................................ 428

384........ Pre‑1 July 1994 quotation of tax file number—request for quotation, or recording, of number not prohibited by the Taxation Administration Act 1953.................................................. 429

385........ Pre‑1 July 1994 quotation of tax file number—objects of tax file number system 429

Notes                                                                                                                                          431

An Act to make provision for the supervision of certain entities engaged in the superannuation industry, and for related purposes

Part 1—Preliminary

Division 1—Preliminary

1  Short title [see Note 1]

                   This Act may be cited as the Superannuation Industry (Supervision) Act 1993.

2  Commencement [see Note 1]

             (1)  Subject to this section, Parts 1, 2, 21, 27, 28, 29, 30, 31 and 32 commence on the day on which this Act receives the Royal Assent.

             (2)  Part 1 (in so far as it relates to section 117) and section 117 are taken to have commenced on 21 October 1992.

             (3)  Parts 18, 19, 20, 23 and 24 and section 342 commence on 1 July 1994.

             (4)  The remaining provisions commence on 1 December 1993, but do not apply to a fund, scheme or trust in relation to a year of income of the fund, scheme or trust earlier than the 1994‑95 year of income.

3  Object of Act

Supervision of certain superannuation entities

             (1)  The object of this Act is to make provision for the prudent management of certain superannuation funds, approved deposit funds and pooled superannuation trusts and for their supervision by APRA, ASIC and the Commissioner of Taxation.

Basis for supervision

             (2)  The basis for supervision is that those funds and trusts are subject to regulation under the Commonwealth’s powers with respect to corporations or pensions (for example, because the trustee is a corporation). In return, the supervised funds and trusts may become eligible for concessional taxation treatment.

Whole industry not covered

             (3)  The Act does not regulate other entities engaged in the superannuation industry.

4  Summary of provisions

                   The Act contains provisions dealing with the following matters:

 

Part No.	Matter dealt with
1	interpretation
2	approval of trustees
2A	licensing of trustees and groups of individual trustees
2B	registrable superannuation entities
3	operating standards for funds and trusts
4	lodgment of annual returns by trustees of superannuation entities
5	notices about complying fund status
6	governing rules of funds and trusts
7	rules applying only to regulated superannuation funds
8	in‑house asset rules applying to regulated superannuation funds
9	equal representation of employers and members in relation to employer‑sponsored funds
10	rules applying only to approved deposit funds
11	rules applying only to pooled superannuation trusts
12	statutory duties of trustees of superannuation entities
13	accounts of superannuation entities
14	other provisions relating to funds and trusts
15	standards for trustees, custodians and investment managers of superannuation entities
16	actuaries and auditors of superannuation entities
17	suspension or removal of trustees of superannuation entities
18	amalgamation of funds
19	rules about dealing with superannuation interests in public offer entities
21	civil and criminal consequences of serious breaches of the Act
23	financial assistance to funds that suffer loss as a result of fraud or theft
24	facility to pay benefits to eligible rollover funds
24A	transitional provisions relating to pre‑1 July 1995 automatic rollovers of benefits between funds
25	monitoring and investigating superannuation entities
25A	tax file numbers
26	offences relating to statements and records
27	powers of courts
28	judicial and other proceedings under the Act
29	exemption and modification provisions
30	miscellaneous provisions
31	transition to scheme provided for in the Act
32	additional transitional provisions relating to tax file numbers

6  General administration of Act

             (1)  Subject to subsections (3) and (4):

                     (a)  APRA has the general administration of the following provisions, to the extent that administration of the provisions is not conferred on the Commissioner of Taxation by paragraph (e):

                              (i)  Parts 2 to 2B;

                             (ii)  Parts 4 to 5;

                            (iii)  section 60A;

                            (iv)  Part 7 (other than sections 64A and 68A);

                             (v)  Parts 8 to 11;

                            (vi)  Part 12 (other than sections 101, 103 and 105);

                           (vii)  Parts 13 to 16;

                           (viii)  Part 17;

                            (ix)  Part 21;

                             (x)  Parts 23 to 24A;

                            (xi)  Division 3 of Part 25;

                           (xii)  Part 25A;

                           (xiii)  Part 32; and

                     (b)  APRA also has the general administration of Parts 3 and 6 (other than section 60A) and section 105 to the extent that that administration is not conferred on ASIC by paragraph (d) or on the Commissioner of Taxation by paragraph (f); and

                     (c)  ASIC has the general administration of:

                              (i)  sections 64A and 68A; and

                             (ii)  sections 101 and 103; and

                            (iii)  Part 19;

                            to the extent that administration is not conferred on the Commissioner of Taxation by paragraph (e); and

                     (d)  ASIC also has the general administration of Parts 3 and 6 (other than section 60A) and section 105 to the extent to which they relate to:

                              (i)  the keeping of reports to members of, or beneficiaries in, funds; or

                             (ii)  disclosure of information to members of, or beneficiaries in, funds; or

                            (iii)  disclosure of information about funds (including disclosure of information to ASIC but not including disclosure of information to APRA); or

                            (iv)  any other matter prescribed by the regulations for the purposes of this paragraph; and

                     (e)  the Commissioner of Taxation has the general administration of the following provisions to the extent that they relate to self managed superannuation funds:

                              (i)  Parts 4, 5, 7 (other than section 68A) and 8;

                             (ii)  Part 12 (other than section 105);

                            (iii)  Parts 13 and 14;

                            (iv)  Part 15;

                             (v)  Parts 16, 17 (other than section 140), 21, 24 and 25A; and

                      (f)  the Commissioner of Taxation also has the general administration of Parts 3 and 6 (other than section 60A) and section 105:

                              (i)  to the extent that they relate to self managed superannuation funds; and

                             (ii)  to the extent that administration is not conferred on ASIC by paragraph (d).

             (2)  Powers and duties are also conferred by Parts 1, 25 (other than Division 3) and 26 27, 28, 29 (other than section 332), 30 and 31 on:

                     (a)  APRA for the purposes of APRA’s administration of the provisions it administers; and

                     (b)  ASIC for the purposes of ASIC’s administration of the provisions it administers.

Note:          Generally neither APRA nor ASIC are referred to in these provisions, Regulator is used instead. See the definition of Regulator in section 10.

          (2A)  Powers and duties are also conferred by Parts 1, 25 (other than Division 3), 26 to 28, 29 (other than section 332) and 30 (other than section 342) on the Commissioner of Taxation for the purposes of the administration of the provisions he or she administers.

Note:          Generally, the Commissioner of Taxation is not referred to in these provisions, Regulator is used instead.

          (2B)  Powers and duties are also conferred on APRA by section 332 for the purposes of the administration of provisions administered by APRA or by the Commissioner of Taxation.

             (3)  The Minister may give APRA or ASIC directions about the performance or exercise of its functions or powers under this Act.

             (4)  Despite subsection (1):

                     (a)  if an entity is not a self managed superannuation fund on the last day of a year of income, APRA has (subject to any later application of this subsection) the general administration of subsections 40(1) and (2), in relation to the entity, in respect of the following:

                              (i)  the doing of anything after the end of that year of income, in relation to that year of income;

                             (ii)  the doing of anything after the end of that year of income, in relation to any previous year of income; and

                     (b)  if an entity is a self managed superannuation fund on the last day of a year of income, the Commissioner of Taxation has (subject to any later application of this subsection) the general administration of subsections 40(1) and (2), in relation to the entity, in respect of the following:

                              (i)  the doing of anything after the end of that year of income, in relation to that year of income;

                             (ii)  the doing of anything after the end of that year of income, in relation any previous year of income; and

                     (c)  the following rules apply in relation to the general administration of subparagraphs 42(1AA)(b)(ii) and (c)(ii), subsection 42(1AC), subparagraphs 42A(3)(c)(ii) and (d)(ii) and subsection 42A(4):

                              (i)  subject to subparagraph (ii), APRA has the general administration of those provisions;

                             (ii)  if another person or body is specified in regulations under subsection 19(4) in respect of a class of superannuation funds, that person or body has the general administration of those provisions to the extent that they relate to funds belonging to that class.

7  Application of Act not to be excluded or modified

                   This Act applies to a superannuation entity despite any provision in the governing rules of the entity, including any provision that purports to substitute, or has the effect of substituting, the provisions of the law of a State or Territory or of a foreign country for all or any of the provisions of this Act.

8  Act extends to external Territories

                   This Act extends to all the external Territories.

9  Crown to be bound

             (1)  This Act binds the Crown in all its capacities.

             (2)  The Crown is not liable to be prosecuted for an offence against, or arising out of, this Act.

9A  Application of the Criminal Code

                   Chapter 2 of the Criminal Code (except Part 2.5) applies to all offences against this Act.

 

Division 2—Interpretation

10  Definitions

             (1)  In this Act, unless the contrary intention appears:

actuary means a person who is a Fellow or an Accredited Member of the Institute of Actuaries of Australia.

ADI (authorised deposit‑taking institution) means:

                     (a)  a body corporate that is an ADI for the purposes of the Banking Act 1959; or

                     (b)  a State bank.

adopted child, in relation to a person, means a person adopted by the first‑mentioned person:

                     (a)  under the law of a State or Territory relating to the adoption of children; or

                     (b)  under the law of any other place relating to the adoption of children, if the validity of the adoption would be recognised under the law of any State or Territory.

amend, in relation to the governing rules of a superannuation entity, includes the insertion of a provision in, or the omission of a provision from, those rules.

annuity includes a benefit provided by a life insurance company or a registered organisation, if the benefit is taken, under the regulations, to be an annuity for the purposes of this Act.

approved auditor means a person included in a class of persons specified in regulations made for the purposes of this definition, but does not include a person in respect of whom a disqualification order is in force under section 131.

approved deposit fund means a fund that:

                     (a)  is an indefinitely continuing fund; and

                     (b)  is maintained by:

                              (i)  an approved trustee; or

                             (ii)  an RSE licensee that is a constitutional corporation; and

                     (c)  is maintained solely for approved purposes.

approved form has the meaning given by section 11A.

approved guarantee has the meaning given by section 11E.

approved purposes, in relation to a fund, means:

                     (a)  the purpose of receiving on deposit:

                              (i)  amounts that will be taken by section 27D of the Income Tax Assessment Act to be expended out of eligible termination payments within the meaning of that section; and

                             (ii)  amounts paid under Part 24 of this Act; and

                            (iii)  amounts paid under section 65 of the Superannuation Guarantee (Administration) Act 1992; and

                     (b)  the purpose of dealing with such amounts, in accordance with the rules of the fund, in any way calculated directly or indirectly to enhance the value of, or render profitable, property of the fund; and

                     (c)  subject to any inconsistent requirement in the standards from time to time applicable to the fund under section 32, the purpose of paying to beneficiaries, or to the legal personal representatives of beneficiaries, upon request, amounts equal to the beneficiary’s interest in the fund; and

                     (d)  such other purposes (if any) as APRA approves in writing.

approved trustee means a constitutional corporation in relation to which an approval under section 26 is in force.

APRA means the Australian Prudential Regulation Authority.

asset means any form of property and, to avoid doubt, includes money (whether Australian currency or currency of another country).

ASIC means the Australian Securities and Investments Commission.

associate has the meaning given by section 12.

Australian court means:

                     (a)  the High Court; or

                     (b)  a court created by the Parliament; or

                     (c)  a court of a State or Territory.

authorised person means a person authorised by the Regulator under section 298A for the purposes of the provision in which the expression occurs.

beneficiary, in relation to a fund, scheme or trust, means a person (whether described in the governing rules as a member, a depositor or otherwise) who has a beneficial interest in the fund, scheme or trust and includes, in relation to a superannuation fund, a member of the fund despite the express references in this Act to members of such funds.

books includes:

                     (a)  any record; or

                     (b)  any accounts or accounting records, however compiled, recorded or stored; or

                     (c)  a document.

business day means a day that is not a Saturday, a Sunday or a public holiday in the place concerned.

child, in relation to a person, includes an adopted child, a step‑child or an ex‑nuptial child of the person.

civil penalty order means a declaration or order made under section 196.

civil penalty provision has the meaning given by section 193.

class, in relation to an RSE licensee, means (except in subsections 29E(7) and (8)) a class of RSE licence provided for under subsection 29B(2) or (3), or under regulations made for the purposes of subsection 29B(4).

Commissioner means the Insurance and Superannuation Commissioner appointed under the Insurance and Superannuation Commissioner Act 1987, or a person for the time being acting as Insurance and Superannuation Commissioner under that Act.

constitutional corporation means a body corporate that is:

                     (a)  a trading corporation formed within the limits of the Commonwealth (within the meaning of paragraph 51(xx) of the Constitution); or

                     (b)  a financial corporation formed within the limits of the Commonwealth (within the meaning of paragraph 51(xx) of the Constitution).

corporate trustee, in relation to a fund, scheme or trust, means a body corporate that is a trustee of the fund, scheme or trust.

Corporations Law means the Corporations Law set out in the Corporations Act 1989.

court means any court, when exercising jurisdiction under this Act.

Court means the Federal Court of Australia or the Supreme Court of a State or a Territory.

custodian, in relation to a superannuation entity, means a person (other than a trustee of the entity) who, under a contract with a trustee or an investment manager of the entity, performs custodial functions in relation to any of the assets of the entity.

data processing device means any article or material (for example, a disc) from which information is capable of being reproduced with or without the aid of any other article or device.

deed includes an instrument having the effect of a deed.

defined benefit fund has (except in Division 3A of Part 8 and in Part 23) the meaning given by the regulations.

defined benefit member has (except in Division 3A of Part 8 and in Part 23) the meaning given by the regulations.

dependant, in relation to a person, includes the spouse of the person, any child of the person and any person with whom the person has an interdependency relationship.

director, in relation to a body corporate, has the same meaning as in the Corporations Act 2001.

disclose, in relation to information, means give, reveal or communicate in any way.

employee has the meaning given by section 15A.

employer has the meaning given by section 15A.

employer representative, in relation to a group of trustees of a fund, a policy committee of a fund or the board of directors of a corporate trustee of a fund, means a member of the group, committee or board, as the case may be, nominated by:

                     (a)  the employer or employers of the members of the fund; or

                     (b)  an organisation representing the interests of that employer or those employers.

employer‑sponsor has the meaning given by subsection 16(1).

employer‑sponsored fund has the meaning given by subsection 16(3).

entity means any of the following:

                     (a)  an individual;

                     (b)  a body corporate;

                     (c)  a partnership;

                     (d)  a trust.

excluded approved deposit fund means an approved deposit fund:

                     (a)  in which there is only one beneficiary; and

                     (b)  that satisfies such other conditions (if any) as are specified in the regulations.

excluded instalment trust, of a superannuation fund, means a trust:

                     (a)  that arises because a trustee or investment manager of the superannuation fund makes an investment under which a listed security (within the meaning of subsection 66(5)) (the underlying security) is held in trust until the purchase price of the underlying security is fully paid; and

                     (b)  where the underlying security, and property derived from the underlying security, is the only trust property; and

                     (c)  where an investment in the underlying security held in trust would not be an in‑house asset of the superannuation fund.

executive officer, in relation to a body corporate, means a person, by whatever name called and whether or not a director of the body, who is concerned, or takes part, in the management of the body.

exempt public sector superannuation scheme means a public sector superannuation scheme that is specified in regulations made for the purposes of this definition.

expert, in relation to a matter, means a person whose profession or reputation gives authority to a statement made by him or her in relation to that matter.

financial services licensee has the meaning given by Chapter 7 of the Corporations Act 2001.

function includes duty.

governing rules, in relation to a fund, scheme or trust, means:

                     (a)  any rules contained in a trust instrument, other document or legislation, or combination of them; or

                     (b)  any unwritten rules;

governing the establishment or operation of the fund, scheme or trust.

group of individual trustees means a group of trustees each of whom is an individual trustee.

group of trustees, in relation to a fund, scheme or trust, means a board, committee or other group of trustees of the fund, scheme or trust.

half‑year means a period of 6 months ending on 30 June or 31 December.

Income Tax Assessment Act means the Income Tax Assessment Act 1936 or the Income Tax Assessment Act 1997.

independent director, in relation to a corporate trustee of a fund, means a director of the corporate trustee who:

                     (a)  is not a member of the fund; and

                     (b)  is neither an employer‑sponsor of the fund nor an associate of such an employer‑sponsor; and

                     (c)  is neither an employee of an employer‑sponsor of the fund nor an employee of an associate of such an employer‑sponsor; and

                     (d)  is not, in any capacity, a representative of a trade union, or other organisation, representing the interests of one or more members of the fund; and

                     (e)  is not, in any capacity, a representative of an organisation representing the interests of one or more employer‑sponsors of the fund.

Note:          Subsection (2) sets out the circumstances in which a director of a corporate trustee of a fund is not taken to be an associate of an employer‑sponsor of the fund.

independent trustee, in relation to a fund, means a trustee of the fund who:

                     (a)  is not a member of the fund; and

                     (b)  is neither an employer‑sponsor of the fund nor an associate of such an employer‑sponsor; and

                     (c)  is neither an employee of an employer‑sponsor of the fund nor an employee of an associate of such an employer‑sponsor; and

                     (d)  is not, in any capacity, a representative of a trade union, or other organisation, representing the interests of one or more members of the fund; and

                     (e)  is not, in any capacity, a representative of an organisation representing the interests of one or more employer‑sponsors of the fund.

individual trustee, in relation to a fund, scheme or trust, means an individual who is a trustee of the fund, scheme or trust.

insolvent under administration means a person who:

                     (a)  under the Bankruptcy Act 1966 or the law of an external Territory, is a bankrupt in respect of a bankruptcy from which the person has not been discharged; or

                     (b)  under the law of a country other than Australia or the law of an external Territory, has the status of an undischarged bankrupt;

and includes:

                     (c)  a person any of whose property is subject to control under:

                              (i)  section 50 or 188 of the Bankruptcy Act 1966; or

                             (ii)  a corresponding provision of the law of an external Territory or the law of a foreign country; or

                     (d)  a person who has executed a personal insolvency agreement under:

                              (i)  Part X of the Bankruptcy Act 1966; or

                             (ii)  the corresponding provisions of the law of an external Territory or the law of a foreign country;

                            if a certificate has not been given under section 232 of that Act or the corresponding provision of the law of the external Territory or foreign country, as the case may be, in respect of the agreement.

inspector has the meaning given by section 265.

interdependency relationship has the meaning given by section 10A.

invest means:

                     (a)  apply assets in any way; or

                     (b)  make a contract;

for the purpose of gaining interest, income, profit or gain.

investment manager means a person appointed by a trustee of a fund or trust to invest on behalf of the trustee, or the trustees, of the fund or trust.

involved, in relation to a contravention, has the meaning given by section 17.

lawyer means a duly qualified legal practitioner and, in relation to a person, means such a practitioner acting for the person.

lease arrangement means any agreement, arrangement or understanding in the nature of a lease (other than a lease) between a trustee of a superannuation fund and another person, under which the other person is to use, or control the use of, property owned by the fund, whether or not the agreement, arrangement or understanding is enforceable, or intended to be enforceable, by legal proceedings.

legal personal representative means the executor of the will or administrator of the estate of a deceased person, the trustee of the estate of a person under a legal disability or a person who holds an enduring power of attorney granted by a person.

licensing transition period means the period:

                     (a)  starting on the commencement of Part 1 of Schedule 1 to the Superannuation Safety Amendment Act 2004; and

                     (b)  ending immediately before the commencement of Part 2 of that Schedule.

life insurance company means:

                     (a)  a body corporate registered under the Life Insurance Act 1995; or

                     (b)  a public authority:

                              (i)  that is constituted by a law of a State or Territory; and

                             (ii)  that carries on life insurance business within the meaning of section 11 of that Act.

loan includes the provision of credit or any other form of financial accommodation, whether or not enforceable, or intended to be enforceable, by legal proceedings.

lodge means lodge with the Regulator.

market value, in relation to an asset, means the amount that a willing buyer of the asset could reasonably be expected to pay to acquire the asset from a willing seller if the following assumptions were made:

                     (a)  that the buyer and the seller dealt with each other at arm’s length in relation to the sale;

                     (b)  that the sale occurred after proper marketing of the asset;

                     (c)  that the buyer and the seller acted knowledgeably and prudentially in relation to the sale.

member has a meaning affected by section 15B.

member of staff means:

                     (a)  in relation to APRA—a person who is an APRA staff member within the meaning of the Australian Prudential Regulation Authority Act 1998; and

                     (b)  in relation to ASIC—a person who is a staff member within the meaning of the Australian Securities and Investments Commission Act 2001; and

                     (c)  in relation to the Commissioner of Taxation—a taxation officer.

member representative, in relation to a group of trustees of a fund, a policy committee of a fund or the board of directors of a corporate trustee of a fund, means a member of the group, committee or board, as the case may be, nominated by:

                     (a)  the members of the fund; or

                     (b)  a trade union, or other organisation, representing the interests of those members.

modifications includes additions, omissions and substitutions.

occurrence of an event includes the coming into existence of a state of affairs.

old‑age pensions has the same meaning as in paragraph 51(xxiii) of the Constitution.

Part 8 associate has the meaning given by Subdivision B of Division 1 of Part 8.

pension, except in the expression old‑age pension, includes a benefit provided by a fund, if the benefit is taken, under the regulations, to be a pension for the purposes of this Act.

policy committee, in relation to a regulated superannuation fund, means a board, committee or other body that:

                     (a)  advises a trustee of the fund about such matters as are specified in the regulations; and

                     (b)  is established by or under the governing rules of the fund.

pooled superannuation trust means a unit trust:

                     (a)  the trustee of which is a constitutional corporation; and

                     (b)  that, under the regulations, is a unit trust to which this definition applies.

premises includes:

                     (a)  a structure, building, aircraft, vehicle or vessel; and

                     (b)  any land or place (whether enclosed or built on or not); and

                     (c)  a part of a structure, building, aircraft, vehicle or vessel or of such a place.

private sector fund means a superannuation fund covered by paragraph (a) of the definition of superannuation fund, other than a public sector fund.

procure includes cause.

produce includes permit access to.

public offer entity means:

                     (a)  a public offer superannuation fund; or

                     (b)  an approved deposit fund that is not an excluded approved deposit fund; or

                     (c)  a pooled superannuation trust.

public offer entity licence means an RSE licence of a class provided for under subsection 29B(2).

public offer superannuation fund has the meaning given by section 18.

public sector fund means a superannuation fund that is:

                     (a)  covered by paragraph (a) of the definition of superannuation fund; and

                     (b)  part of a public sector superannuation scheme.

public sector superannuation scheme means a scheme for the payment of superannuation, retirement or death benefits, where the scheme is established:

                     (a)  by or under a law of the Commonwealth or of a State or Territory; or

                     (b)  under the authority of:

                              (i)  the Commonwealth or the government of a State or Territory; or

                             (ii)  a municipal corporation, another local governing body or a public authority constituted by or under a law of the Commonwealth or of a State or Territory.

rectify, in relation to a contravention of this Act or the regulations that has occurred in relation to a superannuation entity, includes put in operation managerial or administrative arrangements that could reasonably be expected to ensure that there are no further contraventions of a similar kind.

redeem, in relation to an interest in an approved deposit fund, includes pay an amount equal to the interest pursuant to a covenant of a kind referred to in section 53 that is contained, or taken to be contained, in the governing rules of the fund.

registered organisation means:

                     (a)  an association registered under a law of a State or Territory as a trade union; or

                     (b)  a society registered under a law of a State or Territory providing for the registration of friendly or benefit societies; or

                     (c)  an association of employees that is registered as an organisation under Schedule 1B to the Workplace Relations Act 1996.

registrable superannuation entity means:

                     (a)  a regulated superannuation fund; or

                     (b)  an approved deposit fund; or

                     (c)  a pooled superannuation trust;

but does not include a self managed superannuation fund.

regulated document, in relation to a public offer entity, means a document:

                     (a)  issued, or authorised to be issued, by the trustee of the entity; and

                     (b)  that the trustee knows, or ought reasonably to know (having regard to the trustee’s abilities, experience, qualifications and other attributes), may influence a person’s decision:

                              (i)  whether to apply to have a superannuation interest in the entity issued to a person; or

                             (ii)  whether to apply to become a standard employer‑sponsor of the entity.

regulated superannuation fund has the meaning given by section 19.

Regulator means:

                     (a)  APRA if the provision in which it occurs is, or is being applied for the purposes of, a provision that is administered by APRA; and

                     (b)  ASIC if the provision in which it occurs is, or is being applied for the purposes of, a provision that is administered by ASIC; and

                     (c)  the Commissioner of Taxation if the provision in which it occurs is, or is being applied for the purposes of, a provision that is administered by the Commissioner of Taxation.

related, in relation to bodies corporate, has the meaning given by section 20.

related party, of a superannuation fund, means any of the following:

                     (a)  a member of the fund;

                     (b)  a standard employer‑sponsor of the fund;

                     (c)  a Part 8 associate of an entity referred to in paragraph (a) or (b).

related trust, of a superannuation fund, means a trust that a member or a standard employer‑sponsor of the fund controls (within the meaning of section 70E), other than an excluded instalment trust of the fund.

relevant person, in relation to a fund or trust, means:

                     (a)  if the trustee or an investment manager of the fund or trust is or includes an individual—that individual; or

                     (b)  if the trustee or an investment manager of the fund or trust is or includes a body corporate—a responsible officer of that body corporate; or

                     (c)  an auditor of the fund or trust; or

                     (d)  an actuary of the fund or trust; or

                     (e)  a person who is a custodian in relation to the fund or trust.

resident approved deposit fund has the meaning given by section 20A.

resident regulated superannuation fund means a regulated superannuation fund that is a resident superannuation fund within the meaning of subsection 6E(1) of the Income Tax Assessment Act 1936.

responsible officer, in relation to a body corporate, means:

                     (a)  a director of the body; or

                     (b)  a secretary of the body; or

                     (c)  an executive officer of the body.

reviewable decision means:

                     (a)  a decision of APRA under subsection 18(6) or (7) to make a declaration; or

                    (aa)  a decision of APRA under subsection 18(7A) to make a declaration under subsection 18(7) subject to conditions; or

                    (ab)  a decision of APRA under subsection 18(7C) to revoke a declaration that a superannuation fund is not a public offer superannuation fund or;

                     (b)  a decision of APRA under subsection 18(10) to revoke a declaration; or

                    (ba)  a decision of APRA under subsection 24(2) to treat an application as having been withdrawn; or

                     (c)  a decision of APRA under subsection 26(2) refusing an application for approval; or

                     (d)  a decision of APRA under subsection 26(3) to specify conditions in an instrument of approval; or

                    (da)  a decision of APRA under subsection 27A(4) to treat an application as having been withdrawn; or

                    (db)  a decision of APRA under section 27B or 27C to vary the approval of a trustee; or

                    (dc)  a decision of APRA under section 27B to refuse to vary the approval of a trustee; or

                    (dd)  a decision of APRA under subsection 29CA(2) to treat an application for an RSE licence as having been withdrawn; or

                    (de)  a decision of APRA under subsection 29D(2) refusing an application for an RSE licence; or

                    (df)  a decision of APRA under subsection 29EA(1) to impose additional conditions on an RSE licence; or

                    (dg)  a decision of APRA under subsection 29FA(2) to treat an application for variation of an RSE licence so that it is an RSE licence of a different class as having been withdrawn; or

                    (dh)  a decision of APRA under subsection 29FA(2) to treat an application for variation or revocation of a condition imposed on an RSE licence as having been withdrawn; or

                     (di)  a decision of APRA to refuse to vary an RSE licence under subsection 29FC(1) so that it is an RSE licence of a different class; or

                     (dj)  a decision of APRA to refuse to vary or revoke under subsection 29FC(1) any conditions imposed on an RSE licence; or

                    (dk)  a decision of APRA under subsection 29FD(1) to vary or revoke any conditions imposed on an RSE licence; or

                     (dl)  a decision of APRA under subsection 29G(1) to cancel an RSE licence; or

                   (dm)  a decision of APRA under subsection 29M(2) refusing an application for registration of a registrable superannuation entity; or

                    (dn)  a decision of APRA under subsection 29N(2) to cancel the registration of a registrable superannuation entity; or

                     (e)  a decision of the Regulator to give a notice under section 40; or

                      (f)  a decision of the Regulator refusing to give a notice under section 40; or

                    (fa)  a decision of the Regulator under subsection 42(1AA) or (1AC) or paragraph 50(1)(c); or

                     (g)  a decision of the Regulator to give a direction under section 63; or

                     (h)  a decision of the Regulator refusing to revoke a direction under section 63; or

                    (ha)  a decision of the Regulator to make a determination under subsection 70A(1); or

                    (hb)  a decision of the Regulator refusing to revoke a determination under subsection 70A(1); or

                      (i)  a decision of the Regulator refusing to make a determination under paragraph 71(1)(e); or

                      (j)  a decision of the Regulator to revoke a determination under paragraph 71(1)(e); or

                     (k)  a decision of the Regulator to make a determination under subsection 71(4); or

                      (l)  a decision of the Regulator refusing to revoke a determination under subsection 71(4); or

                    (m)  a decision of APRA under section 92 refusing to grant an arrangement approval or a trustee’s subsection 92(5) approval; or

                     (n)  a decision of APRA under section 92 revoking an arrangement approval or a trustee’s subsection 92(5) approval; or

                    (na)  a decision of APRA under subsection 93A(2) or (3) to approve or not approve a higher percentage; or

                    (nb)  a decision of APRA under subsection 93A(4) to specify conditions to which an approval is subject; or

                    (nc)  a decision of APRA under subsection 93A(5) to vary an approval; or

                     (o)  a decision of APRA under subsection 95(2) refusing to approve a borrowing; or

                     (p)  a decision of APRA under subsection 117(6) refusing to waive a requirement; or

                    (pa)  a decision of the Regulator under subsection 120A(1), (2) or (3) to disqualify an individual; or

                    (pb)  a decision of the Regulator under subsection 120A(5) refusing to revoke the disqualification of an individual; or

                     (q)  a decision of APRA under subparagraph 123(2)(b)(ii) or (3)(c)(ii); or

                      (r)  a decision of the Regulator under subsection 126B(4) refusing to allow a longer period than 14 days to make an application for waiver; or

                    (ra)  a decision of the Regulator under subsection 126D(3) refusing to make a declaration waiving an applicant’s status as a disqualified person; or

                    (rb)  a decision of the Regulator under subsection 126F(3) refusing to waive, in whole or in part, the requirement to pay an amount under subsection 126F(2); or

                      (s)  a decision of the Regulator to make a disqualification order under section 131; or

                      (t)  a decision of the Regulator refusing to revoke a disqualification order under section 131; or

                     (u)  a decision of the Regulator under section 141; or

                      (z)  a decision of the Regulator under section 328 to make an exemption; or

                    (za)  a decision of the Regulator under section 329 to make an exemption; or

                    (zb)  a decision of the Regulator under section 332 to make a declaration; or

                    (zc)  a decision of the Regulator under section 333 to make a declaration; or

                    (zd)  a decision of the Regulator under section 335 to revoke an exemption or declaration; or

                    (ze)  a decision of APRA refusing to give a notice under subsection 342(2) in relation to a fund; or

                    (zf)  a decision of APRA to give a notice under subsection 342(6) in relation to a fund; or

                    (zg)  a decision of the Regulator under subsection 347A(9).

RSA has the same meaning as in the Retirement Savings Accounts Act 1997.

RSA provider has the same meaning as in the Retirement Savings Accounts Act 1997.

RSE licence means a licence granted under section 29D.

RSE licensee means a constitutional corporation, body corporate, or group of individual trustees, that holds an RSE licence granted under section 29D.

RSE licensee law means:

                     (a)  this Act or the regulations; and

                     (b)  the Financial Sector (Collection of Data) Act 2001; and

                     (c)  the Financial Institutions Supervisory Levies Collection Act 1998; and

                     (d)  the provisions of the Corporations Act 2001 listed in a subparagraph of paragraph (b) of the definition of regulatory provision in section 38A of this Act or specified in regulations made for the purposes of subparagraph (b)(xvi) of that definition, as applying in relation to superannuation interests; and

                     (e)  any other provisions of any other law of the Commonwealth specified in regulations made for the purposes of this paragraph.

self managed superannuation fund has the meaning given by section 17A.

signed, in relation to a body corporate, means executed by or on behalf of the body corporate in a way that is effective in law and that binds the body corporate.

spouse, in relation to a person, includes another person who, although not legally married to the person, lives with the person on a genuine domestic basis as the husband or wife of the person.

standard employer‑sponsor has the meaning given by subsection 16(2).

standard employer‑sponsored fund has the meaning given by subsection 16(4).

standard employer‑sponsored member has the meaning given by subsection 16(5).

Superannuation Complaints Tribunal means the Superannuation Complaints Tribunal established by the Superannuation (Resolution of Complaints) Act 1993.

superannuation entity means:

                     (a)  a regulated superannuation fund; or

                     (b)  an approved deposit fund; or

                     (c)  a pooled superannuation trust.

superannuation entity affected by a reviewable decision, in relation to a reviewable decision, means the superannuation entity in relation to which the decision was made.

superannuation fund means:

                     (a)  a fund that:

                              (i)  is an indefinitely continuing fund; and

                             (ii)  is a provident, benefit, superannuation or retirement fund; or

                     (b)  a public sector superannuation scheme.

superannuation interest means a beneficial interest in a superannuation entity.

taxation officer means:

                     (a)  a Second Commissioner of Taxation; or

                     (b)  a Deputy Commissioner of Taxation; or

                     (c)  a person engaged under the Public Service Act 1999, or an officer or employee of an authority of the Commonwealth, performing duties in the Australian Taxation Office; or

                     (d)  a person engaged to provide services relating to the Australian Taxation Office.

trustee, in relation to a fund, scheme or trust, means:

                     (a)  if there is a trustee (within the ordinary meaning of that expression) of the fund, scheme or trust—the trustee; or

                     (b)  in any other case—the person who manages the fund, scheme or trust.

unit trust has the same meaning as in Part IX of the Income Tax Assessment Act.

value means market value, and includes amount.

written custody requirements means the written requirements referred to in subparagraph 26(1)(b)(iii).

year of income, in relation to a fund, scheme or trust, means a period that is, for the purposes of the Income Tax Assessment Act, a year of income of the fund scheme, or trust (subsection 6(2A) of that Act applies accordingly).

             (2)  For the purposes of paragraph (b) of the definition of independent director in subsection (1), a director of a corporate trustee of a fund that is also an employer‑sponsor of the fund is not taken to be an associate of that employer‑sponsor by reason only of being such a director.

             (3)  Without limiting the meaning of the expression member in this Act, that expression, in relation to a self managed superannuation fund, includes a person:

                     (a)  who receives a pension from the fund; or

                     (b)  who has deferred his or her entitlement to receive a benefit from the fund.

10A  Interdependency relationship

             (1)  Subject to subsection (3), for the purposes of this Act, 2 persons (whether or not related by family) have an interdependency relationship if:

                     (a)  they have a close personal relationship; and

                     (b)  they live together; and

                     (c)  one or each of them provides the other with financial support; and

                     (d)  one or each of them provides the other with domestic support and personal care.

             (2)  Subject to subsection (3), for the purposes of this Act, if:

                     (a)  2 persons (whether or not related by family) satisfy the requirement of paragraph (1)(a); and

                     (b)  they do not satisfy the other requirements of an interdependency relationship under subsection (1); and

                     (c)  the reason they do not satisfy the other requirements is that either or both of them suffer from a physical, intellectual or psychiatric disability;

they have an interdependency relationship.

             (3)  The regulations may specify:

                     (a)  matters that are, or are not, to be taken into account in determining under subsection (1) or (2) whether 2 persons have an interdependency relationship; and

                     (b)  circumstances in which 2 persons have, or do not have, an interdependency relationship.

11  Approvals, determinations etc. by Regulator

                   If:

                     (a)  a provision of this Act refers to an approval given, determination made or other act or thing done by the Regulator; and

                     (b)  there is no other provision of this Act expressly authorising the Regulator to give the approval, make the determination or do the act or thing;

the Regulator is authorised to give the approval, make the determination or do the act or thing.

11A  Approved forms

             (1)  In this Act, a reference to an approved form is a reference to a form approved by the Regulator, in writing, for the purposes of the provision in which the expression appears.

             (2)  An approved form may require particular information to be included in the completed form.

             (3)  An approved form may do either or both of the following:

                     (a)  require or permit the form to be attached to, or to form part of, another document;

                     (b)  require or permit the form to be given on a specified kind of data processing device or by specified electronic transmission, in accordance with specified software or other requirements.

             (4)  An approved form may require the form to be signed by a particular person or persons. This applies whether or not a provision of this Act also requires the form to be signed.

             (5)  An approved form may make different requirements to be complied with according to whether or not the form is given in a way that is required or permitted as mentioned in paragraph (3)(b).

             (6)  If an approved form makes a requirement as mentioned in subsection (2), (3) or (4), a purported use of the form is not effective for the purposes of this Act unless the requirement has been complied with.

11B  Electronic lodgment of approved forms

             (1)  If a person gives the Regulator an approved form in a way that is required or permitted as mentioned in paragraph 11A(3)(b):

                     (a)  the form is taken to constitute a written notice; and

                     (b)  if the form includes the electronic signature of a person—the form is taken to be signed by that person.

             (2)  The person’s electronic signature is a unique identification, in an electronic form, that is approved by the Regulator for use by the person.

             (3)  A person is guilty of an offence if:

                     (a)  the person gives the Regulator an approved form in a way that is required or permitted as mentioned in paragraph 11A(3)(b); and

                     (b)  either:

                              (i)  the form purports to be given by another person; or

                             (ii)  the form purports to be given on behalf of another person, and that other person has not consented to the giving of the form.

Maximum penalty:    50 penalty units.

             (4)  A person is guilty of an offence if:

                     (a)  the person gives the Regulator an approved form in a way that is required or permitted as mentioned in paragraph 11A(3)(b); and

                     (b)  the form includes the electronic signature of another person who has not consented to the inclusion of the signature.

Maximum penalty:    50 penalty units.

             (5)  Subsections (3) and (4) are offences of strict liability within the meaning of section 6.1 of the Criminal Code.

11C  Declaration required if approved form lodged electronically on trustee’s behalf

             (1)  This section applies if:

                     (a)  the Regulator is given an approved form in a way that is required or permitted as mentioned in paragraph 11A(3)(b); and

                     (b)  the form is given to the Regulator by a person on behalf of the trustee, or one or more of the trustees, of a superannuation entity.

In this section, the trustee, or each of the trustees, on whose behalf the form is given is referred to as the responsible trustee.

             (2)  The responsible trustee is guilty of an offence if the responsible trustee does not, before the form is given to the Regulator, make a signed declaration that states that:

                     (a)  the person is authorised to give the form to the Regulator on the responsible trustee’s behalf; and

                     (b)  the information in the form is correct.

Maximum penalty:    50 penalty units.

             (3)  The responsible trustee is guilty of an offence if the responsible trustee does not retain the declaration for 5 years after it is made.

Maximum penalty:    50 penalty units.

             (4)  The responsible trustee is guilty of an offence if:

                     (a)  within the 5 year period, the Regulator requests the responsible trustee to produce the declaration to the Regulator; and

                     (b)  the responsible trustee does not comply with the request.

Maximum penalty:    50 penalty units.

             (5)  Subsections (2), (3) and (4) are offences of strict liability within the meaning of section 6.1 of the Criminal Code.

11D  Electronic lodgment—documents other than approved forms

             (1)  A document that is not required to be lodged in an approved form may be lodged with the Regulator electronically only if:

                     (a)  the Regulator and the person seeking to lodge it (either on the person’s own behalf or on another person’s behalf) have agreed, in writing, that it may be lodged electronically; or

                     (b)  the Regulator has approved, in writing, the electronic lodgment of documents of that kind.

             (2)  The document is taken to be lodged with the Regulator if it is lodged in accordance with the agreement or approval (including any requirements of the agreement or approval as to authentication).

11E  Approved guarantees

             (1)  In this Act, an approved guarantee is:

                     (a)  a guarantee given by an ADI; or

                     (b)  a guarantee given by or on behalf of the Commonwealth, a State or a Territory;

that meets the requirements that APRA determines in writing.

             (2)  A determination under subsection (1) is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.

12  Associates

             (1)  The question whether a person is an associate of another person for the purposes of this Act is to be determined in the same way as that question would be determined under the Corporations Act 2001 if the assumptions set out in subsection (2) were made.

             (2)  The assumptions are as follows:

                     (a)  that sections 12 and 14 and paragraphs 15(1)(b) and 16(1)(b) and (c) of that Act had not been enacted;

                     (b)  that section 13 of that Act were not limited to Chapter 7, but extended to all provisions of that Act.

13  Single trustees

                   For the purposes of this Act:

                     (a)  a fund, scheme or trust has a single corporate trustee if, and only if, there is only one trustee of the fund, scheme or trust and that trustee is a corporate trustee; and

                     (b)  a fund, scheme or trust has a single individual trustee if, and only if, there is only one trustee of the fund, scheme or trust and that trustee is an individual trustee.

13A  RSE licensees that are groups of individual trustees

             (1)  Subject to this section, for the purposes of this Act and the regulations, a change in the composition of a group of individual trustees that is an RSE licensee does not affect the continuity of the group of individual trustees for the duration of the period during which the RSE licence continues in force.

Note:          So, for example, an RSE licence granted to a group of individual trustees will not cease to continue in force, merely because of a change in the membership of the group.

             (2)  An obligation that would be imposed on an RSE licensee that is a group of individual trustees of a registrable superannuation entity by a provision of this Act or the regulations is imposed instead on each of the trustees but, subject to the entity’s governing rules, may be discharged by any of them.

             (3)  A person who is a member of a group of individual trustees that is an RSE licensee is not liable under any offence of strict liability or civil penalty provision of this Act or the regulations in respect of any breach of a provision of this Act or the regulations, or failure, by the RSE licensee if the person proves that he or she:

                     (a)  made all inquiries (if any) that were reasonable in the circumstances; and

                     (b)  after doing so, believed on reasonable grounds that the obligations of the RSE licensee were being complied with.

Note:          In a prosecution for an offence of strict liability against a provision of this Act or the regulations, a defendant bears a legal burden in relation to the matters in subsection (3) (see section 13.4 of the Criminal Code).

             (4)  If a group of individual trustees is an RSE licensee, a direction, notice or other document is taken, for the purposes of a provision of this Act or the regulations, to be given to the RSE licensee if it is given it to any member of the group.

             (5)  If a group of individual trustees of a registrable superannuation entity is an RSE licensee, a request is taken, for the purposes of a provision of this Act or the regulations, to have been made to the RSE licensee if it is made to any member of the group and, subject to the entity’s governing rules, may be dealt with by any member of the group.

             (6)  Any requirement under this Act or the regulations that a document be signed by an RSE licensee is taken, if the RSE licensee is a group of individual trustees, to be a requirement that the document be signed by each of the members of the group.

             (7)  An RSE licensee that is a group of individual trustees is taken, for the purposes of a provision of this Act or the regulations, to have provided something to a person if one of the members of the group has provided that thing to the person.

             (8)  For the purposes of this Act and the regulations, if an RSE licensee that is a group of individual trustees is affected by a reviewable decision, each member of the group is taken to be affected by that decision.

             (9)  The regulations may exclude or modify the effect of the subsections of this section (other than subsections (2) and (3)) in relation to specified provisions.

           (10)  This section has effect subject to a contrary intention in a provision of this Act or regulations made for the purposes of subsection (9).

14  Indefinitely continuing fund—application of rules against perpetuities

                   If the governing rules of a fund contain a provision the purpose of which is to avoid a breach of a rule of law relating to perpetuities, that provision does not prevent the fund from being treated as an indefinitely continuing fund for the purposes of the definition of approved deposit fund or superannuation fund in section 10.

15  Approved deposit funds—payments by trustees

             (1)  For the purposes of paragraph (c) of the definition of approved purposes in section 10 and for the purposes of section 53, if:

                     (a)  a beneficiary has an interest in a fund; and

                     (b)  on the request of the beneficiary, an amount equal to the beneficiary’s interest is paid by the fund:

                              (i)  to a life insurance company or registered organisation for the purchase of an annuity in the name of the beneficiary; or

                             (ii)  into an RSA specified by the beneficiary;

the trustee of the fund is taken to have paid the amount to the beneficiary on request.

          (1A)  For the purposes of paragraph (c) of the definition of approved purposes in section 10 and for the purposes of section 53, if:

                     (a)  a beneficiary has an interest in a fund; and

                     (b)  on the request of the beneficiary, an amount equal to the beneficiary’s interest is paid by the fund to:

                              (i)  an approved deposit fund; or

                             (ii)  a regulated superannuation fund;

the trustee of the first‑mentioned fund is taken to have paid the amount to the beneficiary on request.

          (1B)  For the purposes of paragraph (c) of the definition of approved purposes in section 10, if a payment is not made immediately on request but is deferred for a period determined by the trustee concerned, the payment is taken to have been made on request.

             (2)  A reference in subsection (1) or (1A) to a beneficiary includes a reference to the legal personal representative of a beneficiary.

15A  Definitions of employee and employer

             (1)  Subject to this section, in this Act, employee and employer have their ordinary meaning. However, for the purposes of this Act, subsections (2) to (10):

                     (a)  expand the meaning of those terms; and

                     (b)  make particular provision to avoid doubt as to the status of certain persons.

             (2)  A person who is entitled to payment for the performance of duties as a member of the executive body (whether described as the board of directors or otherwise) of a body corporate is, in relation to those duties, an employee of the body corporate.

             (3)  If a person works under a contract that is wholly or principally for the labour of the person, the person is an employee of the other party to the contract.

             (4)  A member of the Parliament of the Commonwealth is an employee of the Commonwealth.

             (5)  A member of the Parliament of a State is an employee of the State.

             (6)  A member of the Legislative Assembly for the Australian Capital Territory is an employee of the Australian Capital Territory.

             (7)  A member of the Legislative Assembly of the Northern Territory is an employee of the Northern Territory.

             (8)  For the purposes of this Act:

                     (a)  a person who is paid to perform or present, or to participate in the performance or presentation of, any music, play, dance, entertainment, sport, display or promotional activity or any similar activity involving the exercise of intellectual, artistic, musical, physical or other personal skills is an employee of the person liable to make the payment; and

                     (b)  a person who is paid to provide services in connection with an activity referred to in paragraph (a) is an employee of the person liable to make the payment; and

                     (c)  a person who is paid to perform services in, or in connection with, the making of any film, tape or disc or of any television or radio broadcast is an employee of the person liable to make the payment.

             (9)  Subject to subsection (10), a person who:

                     (a)  holds, or performs the duties of, an appointment, office or position under the Constitution or under a law of the Commonwealth, of a State or of a Territory; or

                     (b)  is otherwise in the service of the Commonwealth, of a State or of a Territory (including service as a member of the Defence Force or as a member of a police force);

is an employee of the Commonwealth, the State or the Territory, as the case requires.

           (10)  A person who holds office as a member of a local government council is an employee of the council.

15B  Modified meaning of member

             (1)  The regulations may provide that a person is to be treated, or is not to be treated, as being a member of a superannuation fund for the purposes of this Act or specified provisions of this Act.

             (2)  This Act applies with such modifications (if any) as are prescribed in relation to a person who is a member of a superannuation fund because of regulations made for the purposes of this section.

             (3)  In this section:

modifications includes additions, omissions and substitutions.

16  Definitions associated with employer‑sponsorship

Employer‑sponsor

             (1)  An employer‑sponsor of a regulated superannuation fund is an employer who:

                     (a)  contributes to the fund; or

                     (b)  would, apart from a temporary cessation of contributions, contribute to the fund;

for the benefit of:

                     (c)  a member of the fund who is an employee of:

                              (i)  the employer; or

                             (ii)  an associate of the employer; or

                     (d)  the dependants of such a member in the event of the death of the member.

Standard employer‑sponsor

             (2)  If an employer so contributes, or would contribute, wholly or partly pursuant to an arrangement between the employer and a trustee of the regulated superannuation fund concerned, the employer is a standard employer‑sponsor of the fund (as well as being an employer‑sponsor of the fund). If the employer only so contributes, or would contribute, pursuant to arrangements between the employer and a member or members of the fund, the employer is not a standard employer‑sponsor.

Employer‑sponsored fund

             (3)  An employer‑sponsored fund is a regulated superannuation fund that has at least one employer‑sponsor.

Standard employer‑sponsored fund

             (4)  If a regulated superannuation fund has at least one standard employer‑sponsor, the fund is a standard employer‑sponsored fund (as well as being an employer‑sponsored fund).

Standard employer‑sponsored member

             (5)  A standard employer‑sponsored member is a member of a regulated superannuation fund in respect of whom an employer‑sponsor contributes, or would contribute, as mentioned in subsection (1) wholly or partly pursuant to an arrangement between the employer‑sponsor and a trustee of the fund.

17A  Definition of self managed superannuation fund

Basic conditions—funds other than single member funds

             (1)  Subject to this section, a superannuation fund, other than a fund with only one member, is a self managed superannuation fund if and only if it satisfies the following conditions:

                     (a)  it has fewer than 5 members;

                     (b)  if the trustees of the fund are individuals—each individual trustee of the fund is a member of the fund;

                     (c)  if the trustee of the fund is a body corporate—each director of the body corporate is a member of the fund;

                     (d)  each member of the fund:

                              (i)  is a trustee of the fund; or

                             (ii)  if the trustee of the fund is a body corporate—is a director of the body corporate;

                     (e)  no member of the fund is an employee of another member of the fund, unless the members concerned are relatives;

                      (f)  no trustee of the fund receives any remuneration from the fund or from any person for any duties or services performed by the trustee in relation to the fund.

Basic conditions—single member funds

             (2)  Subject to this section, a superannuation fund with only one member is a self managed superannuation fund if and only if:

                     (a)  if the trustee of the fund is a body corporate:

                              (i)  the member is the sole director of the body corporate; or

                             (ii)  the member is one of only 2 directors of the body corporate, and the member and the other director are relatives; or

                            (iii)  the member is one of only 2 directors of the body corporate, and the member is not an employee of the other director; and

                     (b)  if the trustees of the fund are individuals:

                              (i)  the member is one of only 2 trustees, of whom one is the member and the other is a relative of the member; or

                             (ii)  the member is one of only 2 trustees, and the member is not an employee of the other trustee; and

                     (c)  no trustee of the fund receives any remuneration from the fund or from any person for any duties or services performed by the trustee in relation to the fund.

Certain other persons may be trustees

             (3)  A superannuation fund does not fail to satisfy the conditions specified in subsection (1) or (2) by reason only that:

                     (a)  a member of the fund has died and the legal personal representative of the member is a trustee of the fund or a director of a body corporate that is the trustee of the fund, in place of the member, during the period:

                              (i)  beginning when the member of the fund died; and

                             (ii)  ending when death benefits commence to be payable in respect of the member of the fund; or

                     (b)  the legal personal representative of a member of the fund is a trustee of the fund or a director of a body corporate that is the trustee of the fund, in place of the member, during any period when:

                              (i)  the member of the fund is under a legal disability; or

                             (ii)  the legal personal representative has an enduring power of attorney in respect of the member of the fund; or

                     (c)  if a member of the fund is under a legal disability because of age and does not have a legal personal representative—the parent or guardian of the member is a trustee of the fund in place of the member; or

                     (d)  an appointment under section 134 of an acting trustee of the fund is in force.

Circumstances in which entity that does not satisfy basic conditions remains a self managed superannuation fund

             (4)  Subject to subsection (5), if a superannuation fund that is a self managed superannuation fund would, apart from this subsection, cease to be a self managed superannuation fund, it does not so cease until the earlier of the following times:

                     (a)  the time an approved trustee of the fund or an RSE licensee of the fund is appointed;

                     (b)  6 months after it would so cease to be a self managed superannuation fund.

Subsection (4) does not apply if admission of new members

             (5)  Subsection (4) does not, except for the purposes of section 29J, apply if the reason, or one of the reasons, why the superannuation fund would cease to be a self managed superannuation fund was the admission of one or more new members to the fund.

Extended meaning of employee in certain circumstances

             (6)  For the purposes of this section, a member of a fund, who is an employee of an employer‑sponsor of the fund, is also taken to be an employee of another person (the other person), if the employer‑sponsor is:

                     (a)  a relative of the other person; or

                     (b)  either of the following:

                              (i)  a body corporate of which the other person, or a relative of the other person, is a director;

                             (ii)  a body corporate related to that body corporate; or

                     (c)  a trustee of a trust of which the other person, or a relative of the other person, is a beneficiary; or

                     (d)  a partnership, where:

                              (i)  the other person, or a relative of the other person, is a partner in the partnership; or

                             (ii)  the other person, or a relative of the other person, is a director of a body corporate that is a partner in the partnership; or

                            (iii)  the other person, or a relative of the other person, is a beneficiary of a trust, if a trustee of the trust is a partner in the partnership.

Note 1:       An effect of this subsection is that a fund will not be a self‑managed superannuation fund if a member is employed by an employer‑sponsor of the fund, and another member (who is not a relative) has a specified interest in that employer‑sponsor: see paragraph (1)(e). An example of this would be where the employer‑sponsor is a company of which another member is a director.

Note 2:       Another effect is that a fund will not be a self‑managed superannuation fund if its single member is employed by an employer‑sponsor of the fund in which the other trustee of the fund (who is not a relative) has a specified interest: see subsection (2).

             (7)  Subsection (6) does not limit the meaning of the term employee.

Regulations

             (8)  For the purposes of this section:

                     (a)  a member of a fund is taken to be an employee of a person belonging to a class specified in the regulations for the purposes of this paragraph; and

                     (b)  despite subsections (6) and (7) and section 15A, a member of a fund is not taken to be an employee of a person belonging to a class specified in the regulations for the purposes of this paragraph.

Meaning of relative

             (9)  In this section:

relative, in relation to an individual, means:

                     (a)  a parent, child, grandparent, grandchild, sibling, aunt, uncle, great‑aunt, great‑uncle, niece, nephew, first cousin or second cousin of the individual or of his or her spouse or former spouse; or

                     (b)  another individual having such a relationship to the individual or to his or her spouse or former spouse because of adoption or remarriage; or

                     (c)  the spouse or former spouse of the individual, or of an individual referred to in paragraph (a) or (b).

Disqualified persons

           (10)  For the avoidance of doubt, subsection (3) does not permit a person, in the capacity of legal personal representative of a disqualified person (within the meaning of section 120), to be a trustee of a self managed superannuation fund.

18  Public offer superannuation fund

Definition

             (1)  A superannuation fund is a public offer superannuation fund if:

                     (a)  one of the following subparagraphs applies to the fund:

                              (i)  it is a regulated superannuation fund that is not a standard employer‑sponsored fund;

                             (ii)  it is a standard employer‑sponsored fund that has at least one member:

                                        (A)  who is not a standard employer‑sponsored member; and

                                        (B)  who is not a member of a prescribed class;

                            (iii)  it is a standard employer‑sponsored fund in relation to which an election under subsection (2) has been made;

                            (iv)  a declaration under subsection (6) (which allows for funds to be declared to be public offer superannuation funds) is in force in relation to the fund; and

                    (aa)  the fund is not a self managed superannuation fund; and

                     (b)  no declaration under subsection (7) (which allows for funds to be declared not to be public offer superannuation funds) is in force in relation to the fund.

Election to be a public offer superannuation fund

             (2)  The trustee of a standard employer‑sponsored fund may elect that the fund is to be treated as a public offer superannuation fund.

How an election is made

             (3)  An election must be made by giving APRA a written notice that is:

                     (a)  in the approved form; and

                     (b)  signed by the trustee.

Trustee has power to make election despite anything in the governing rules

             (4)  The trustee has the power to make an election despite anything in the governing rules of the fund.

Election is irrevocable

             (5)  An election is irrevocable.

Declaration that fund is a public offer superannuation fund

             (6)  APRA may, in writing, declare a superannuation fund to be a public offer superannuation fund.

Declaration that fund is not a public offer superannuation fund

             (7)  APRA may, in writing, declare a superannuation fund not to be a public offer superannuation fund.

          (7A)  A declaration that a superannuation fund is not a public offer superannuation fund may be subject to conditions.

          (7B)  If a condition has been breached the trustee must immediately notify APRA, in writing, of the breach.

Penalty:  30 penalty units.

        (7BA)  Subsection (7B) is an offence of strict liability.

Note 1:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Note 2:       For strict liability, see section 6.1 of the Criminal Code.

          (7C)  If APRA is satisfied, whether because of a notification under subsection (7B) or otherwise, that a condition to which the declaration is subject has been breached:

                     (a)  APRA may revoke the declaration; and

                     (b)  the superannuation fund is taken, with effect from the revocation, to have become a public offer superannuation fund.

Commencement of declaration

             (8)  A declaration comes into force when it is made, or, if a later time is specified in the declaration as the time when it comes into force, it comes into force at that later time.

Cessation of declaration

             (9)  A declaration remains in force:

                     (a)  if a time is specified in the declaration as the time when it stops being in force—until that time, or until the declaration is revoked, whichever occurs first; or

                     (b)  otherwise—until the declaration is revoked.

Revocation of declaration

           (10)  APRA may, in writing, revoke a declaration.

APRA must have regard to guidelines when making or revoking a declaration

           (11)  When making or revoking a declaration, APRA must have regard to any written guidelines determined by APRA under this subsection.

Copy of declaration or revocation to be given to trustee

           (12)  As soon as practicable after making or revoking a declaration, APRA must give the trustee of the superannuation fund concerned a copy of the instrument making or revoking the declaration.

19  Regulated superannuation fund

Definition

             (1)  A regulated superannuation fund is a superannuation fund in respect of which subsections (2) to (4) have been complied with.

Fund must have a trustee

             (2)  The superannuation fund must have a trustee.

Trustee must be a constitutional corporation or fund must be a pension fund

             (3)  Either of the following must apply:

                     (a)  the trustee of the fund must be a constitutional corporation pursuant to a requirement contained in the governing rules;

                     (b)  the governing rules must provide that the sole or primary purpose of the fund is the provision of old‑age pensions.

Election by trustee

             (4)  The trustee or trustees must have given to APRA, or such other body or person as is specified in the regulations, a written notice that is:

                     (a)  in the approved form; and

                     (b)  signed by the trustee or each trustee;

electing that this Act is to apply in relation to the fund.

Note:          The approved form of written notice may require the trustee or the trustees to set out the tax file number of the fund. See subsection 299U(1).

Regulations

          (4A)  Without limiting subsection (4), regulations for the purposes of that subsection may specify that notices are to be given to different persons or bodies in respect of different classes of superannuation funds.

Election is irrevocable

             (5)  An election made as mentioned in subsection (4) is irrevocable.

Trustee has power to make election despite anything in the governing rules etc.

             (6)  The trustee or trustees have the power to make an election as mentioned in subsection (4) despite anything in the governing rules of the fund.

Certain funds must become regulated superannuation funds

             (7)  If all of the following conditions are satisfied in relation to a superannuation fund at any time during the period beginning on the day on which this Act received the Royal Assent and ending at the end of the fund’s 1993‑94 year of income:

                     (a)  the fund has a trustee;

                     (b)  either:

                              (i)  the trustee of the fund is a constitutional corporation; or

                             (ii)  the governing rules of the fund provide that the sole or primary purpose of the fund is the provision of old‑age pensions;

                     (c)  the fund is not a public sector superannuation scheme;

                     (d)  there is in force a notice under section 12 or 13 of the Occupational Superannuation Standards Act 1987 stating that the Commissioner is satisfied that the fund satisfied, or should be treated as if it had satisfied, the superannuation fund conditions in relation to a particular year of income;

                     (e)  there is not in force a notice under section 12 or 13 of the Occupational Superannuation Standards Act 1987 stating that the Commissioner is not satisfied that the fund satisfied the superannuation fund conditions in relation to a year of income later than the year of income mentioned in paragraph (d);

the trustee of the fund must use its best endeavours to ensure that the fund becomes a regulated superannuation fund at or before the beginning of the fund’s 1994‑95 year of income.

Contravention of subsection (7) is not an offence

             (8)  A contravention of subsection (7) is not an offence. However, a contravention of subsection (7) is a ground for the grant of an injunction under section 315.

References to repealed provisions of OSSA

             (9)  A reference in this section to a provision of the Occupational Superannuation Standards Act 1987 includes a reference to the provision as it continues to apply, despite its repeal, because of the Occupational Superannuation Standards Amendment Act 1993.

20  Related bodies corporate

                   The question whether bodies corporate are related to each other for the purposes of this Act is to be determined in the same way as that question would be determined under the Corporations Act 2001.

20A  Resident approved deposit funds

Resident approved deposit funds

             (1)  For the purposes of this Act, an approved deposit fund is a resident approved deposit fund at a particular time if, and only if:

                     (a)  either:

                              (i)  the fund was established in Australia; or

                             (ii)  at that time, any asset of the fund is situated in Australia; and

                     (b)  at that time, the central management and control of the fund is in Australia; and

                     (c)  at that time, the percentage worked out using the following formula is not less than 50%:

                            where:

                            Accumulated entitlements of resident members means the sum of so much of the value of the assets of the fund at that time as is attributable to:

                              (i)  deposits made to the fund before that time by or in respect of members of the fund who are residents at that time; and

                             (ii)  income or accretions arising from those deposits.

                            Total assets of fund means the value of the assets of the fund at that time.

Definitions

             (2)  In this section:

Australia has the same meaning as in the Income Tax Assessment Act 1936.

member includes depositor.

resident has the same meaning as in the Income Tax Assessment Act 1936.

 

Part 2—Approval of trustees

  

21  Object of Part

             (1)  The object of this Part is to provide for constitutional corporations to be approved as trustees for the purposes of this Act.

             (2)  This Part operates concurrently with Part 2A (which is about licensing of trustees and groups of individual trustees). The significance of the approval or licensing of trustees, or groups of individual trustees, is as follows:

                     (a)  a fund cannot be an approved deposit fund unless it is maintained by an approved trustee or an RSE licensee that is a constitutional corporation (the other requirements of the definition of approved deposit fund in section 10 must also be satisfied);

                     (b)  the trustee of a public offer entity must not engage in conduct to which section 152 applies unless the trustee is an approved trustee or an RSE licensee that is a constitutional corporation (other requirements also apply before that conduct may be engaged in);

                     (c)  a person must not be, or act as, the trustee of a superannuation fund with fewer than 5 members (other than a self managed superannuation fund) if the person is required by subsection 121A(1) to be, but is not, an approved trustee or an RSE licensee that is a constitutional corporation;

                     (d)  APRA may suspend or remove a trustee of a superannuation fund with fewer than 5 members (other than a self managed superannuation fund) if the trustee is required by subsection 121A(1) to be, but is not, an approved trustee or an RSE licensee that is a constitutional corporation;

                     (e)  a person may contravene subsection 29J(1) if the person is not an approved trustee or does not hold an RSE licence.

Note:          See Part 2A for information about RSE licences.

22  Interpretation

             (1)  In this Part:

relevant entity means:

                     (a)  a public offer entity; or

                     (b)  an approved deposit fund.

             (2)  A reference in section 27A, 27B, 27C, 27D, 27E, 28 or 29 to an approval includes a reference to an approval as varied under section 27B or 27C.

23  Application for approval

             (1)  A constitutional corporation may apply to APRA for an approval as a trustee for the purposes of this Act.

          (1A)  However, an application must not be made during the licensing transition period.

             (2)  An application must:

                     (a)  be in the approved form; and

                     (b)  contain the information required by the form; and

                     (c)  be accompanied by an application fee of the prescribed amount.

24  Further information may be requested

             (1)  If APRA needs further information to decide the application for approval, APRA may request the applicant, in writing, to supply APRA with such further information as is specified in the request within such time as is specified in the request.

             (2)  If, without reasonable excuse, the applicant refuses or fails to comply with the request, APRA may decide to treat the application as having been withdrawn.

             (3)  If APRA decides, under subsection (2), to treat the application as having been withdrawn, APRA must, as soon as practicable after so deciding, inform the applicant in writing to that effect.

25  Period within which application for approval is to be decided

             (1)  Subject to this section, APRA must decide an application for approval within 60 days after receiving it.

             (2)  If APRA thinks that it will take longer to decide the application, APRA may extend, by up to 60 days, the period for deciding it.

             (3)  An extension must be made by written notice given to the applicant within 60 days after APRA receives the application.

             (4)  If APRA makes an extension, APRA must decide the application within the extended period.

             (5)  If APRA has not decided the application by the end of the day by which APRA is required to decide it, APRA is taken to have decided, at the end of that day, to refuse the application.

26  Deciding an application for approval

             (1)  APRA must, in writing, approve an applicant as a trustee for the purposes of this Act if, and only if:

                     (a)  APRA is satisfied that the applicant can be relied on to perform, in a proper manner, the duties of trustee of any relevant entity of which the applicant is or becomes the trustee; and

                     (b)  at least one of the following subparagraphs applies:

                              (i)  APRA is satisfied that the value of the net tangible assets of the applicant is not less than the amount prescribed by the regulations;

                             (ii)  APRA is satisfied that the applicant is entitled to the benefit of an approved guarantee of an amount not less than the amount prescribed by the regulations, being a guarantee in respect of the applicant’s duties as trustee of each relevant entity of which the applicant is, or is proposing to become, the trustee;

                           (iia)  APRA is satisfied that the applicant passes the test set out in subsection (1A);

                            (iii)  the applicant has agreed to comply with the written requirements given to the applicant by APRA before the granting of the approval, being requirements relating to the custody of the assets of a relevant entity or relevant entities of which the applicant is or becomes the trustee; and

                     (c)  the applicant’s application was made before the start of the licensing transition period.

          (1A)  For the purposes of subparagraph (1)(b)(iia), the applicant passes the test set out in this subsection if:

                     (a)  the applicant is entitled to the benefit of an approved guarantee, being a guarantee in respect of the applicant’s duties as trustee of each relevant entity of which the applicant is, or is proposing to become, the trustee; and

                     (b)  the sum of the amount of the approved guarantee and the value of the net tangible assets of the applicant is not less than the amount prescribed by the regulations.

             (2)  Otherwise, APRA must, in writing, refuse the application.

             (3)  The approval is subject to any conditions specified in the instrument of approval.

             (4)  If APRA refuses the application, APRA must set out the reasons for the refusal in the instrument of refusal.

             (5)  APRA must cause the applicant to be given a copy of the instrument of approval or refusal.

             (6)  An instrument of approval must designate a particular subparagraph of paragraph (1)(b) as the subparagraph on the basis of which the applicant is approved.

             (7)  In this section:

net tangible assets has the meaning given by the regulations.

27  When an approval is in force

                   An approval under section 26:

                     (a)  comes into force when it is granted, or, if a later time is specified in the instrument of approval as the time when the approval comes into force, at that later time; and

                     (b)  remains in force, subject to any variation under section 27B or 27C, until:

                              (i)  it is revoked under section 28; or

                             (ii)  the trustee is granted an RSE licence under section 29D.

27A  Application for variation of an approval

             (1)  An approved trustee may apply to APRA for variation of the approval of the trustee by requesting a variation of:

                     (a)  the designation of the subparagraph of paragraph 26(1)(b) as the subparagraph on the basis of which the trustee is approved; or

                     (b)  any written custody requirements with which the trustee is required to comply; or

                     (c)  any conditions to which the approval is subject.

             (2)  An application must:

                     (a)  be made in writing; and

                     (b)  specify the variation requested by the trustee; and

                     (c)  set out the reasons for the application; and

                     (d)  be signed by a responsible officer of the trustee.

             (3)  If APRA needs further information to decide an application, APRA may request the trustee, in writing, to supply APRA with such further information as is specified in the request within such time as is specified in the request.

             (4)  If, without reasonable excuse, the trustee refuses or fails to comply with the request, APRA may decide to treat the application as having been withdrawn.

             (5)  If APRA decides, under subsection (4), to treat the application as having been withdrawn, APRA must, as soon as practicable after so deciding, inform the applicant in writing to that effect.

27B  An application must be decided within a period of time

             (1)  Subject to this section, APRA must decide an application for variation of the approval of a trustee within 60 days after receiving it.

             (2)  APRA is not required to vary the approval of a trustee in the terms requested by the trustee.

             (3)  If APRA thinks that it will take longer than 60 days to decide the application, APRA may extend the period for deciding it by no more than 60 days.

             (4)  An extension must be notified in writing to the trustee within 60 days after APRA receives the application.

             (5)  If APRA makes an extension, APRA must decide the application within the extended period.

             (6)  If APRA has not decided the application by the end of the day by which APRA is required to decide it, APRA is taken to have decided, at the end of that day, to refuse the application.

27C  APRA may vary an approval on its own initiative

                   APRA may, on its own initiative, vary the approval of a trustee by varying:

                     (a)  any written custody requirements with which the trustee is required to comply; or

                     (b)  any conditions to which the approval is subject.

27D  Notifying the trustee of the outcome of an application

             (1)  If, under section 27B or 27C, APRA decides to vary the approval of a trustee, APRA must:

                     (a)  by notice in writing, vary the approval; and

                     (b)  give a copy of that notice, and a statement of the reasons for the variation, to the trustee.

             (2)  A notice varying an approval must:

                     (a)  identify the approval being varied; and

                     (b)  specify the day, not earlier than the day on which the notice of variation is made, when the variation begins; and

                     (c)  designate a particular subparagraph of paragraph 26(1)(b) as the subparagraph on the basis of which the trustee is approved after the variation begins; and

                     (d)  specify any written custody requirements with which the trustee is required to comply after the variation begins; and

                     (e)  specify any conditions to which the approval of the trustee is subject after the variation begins.

             (3)  If, under section 27B, APRA decides to refuse to vary the approval of a trustee, APRA must:

                     (a)  by notice in writing, record that it has so decided; and

                     (b)  give a copy of that notice, and a statement of the reasons for the refusal to vary the approval, to the trustee.

27E  When a variation of approval comes into force

                   If, under section 27B or 27C, APRA decides to vary an approval of a trustee:

                     (a)  that variation comes into force on the day specified in the notice under paragraph 27D(2)(b); and

                     (b)  the variation remains in force until:

                              (i)  the revocation of the approval to which it relates; or

                             (ii)  the coming into force of a later variation of that approval; or

                            (iii)  the trustee is granted an RSE licence under section 29D.

28  Revocation of approval

             (1)  APRA may revoke the approval of an approved trustee by written notice given to the trustee.

             (2)  Without limiting subsection (1), APRA may revoke an approval under that subsection if APRA is satisfied, on reasonable grounds, that:

                    (aa)  the trustee has requested in writing that the approval be revoked; or

                     (a)  there has been a contravention of any condition to which the approval is subject; or

                     (b)  the trustee can no longer be relied on to perform, in a proper manner, the duties of trustee of each relevant entity of which the trustee is the trustee; or

                     (c)  if subparagraph 26(1)(b)(i) is designated as the subparagraph on the basis of which the trustee is approved—that subparagraph has ceased to apply to the trustee; or

                     (d)  if subparagraph 26(1)(b)(ii) is designated as the subparagraph on the basis of which the trustee is approved—that subparagraph has ceased to apply to the trustee; or

                    (da)  if subparagraph 26(1)(b)(iia) is designated as the subparagraph on the basis of which the trustee is approved—that subparagraph has ceased to apply to the trustee; or

                     (e)  if subparagraph 26(1)(b)(iii) is designated as the subparagraph on the basis of which the trustee is approved—the trustee has failed to comply with a requirement of APRA under that subparagraph.

             (3)  Except in a case covered by paragraph (2)(aa), APRA must not make a decision under subsection (1) without the written consent of the Minister.

29  Notification of change in circumstances or breach of conditions

             (1)  An approved trustee must, as soon as practicable, and in any event within 30 days, after becoming aware of an event referred to in subsection (2), give APRA a written notice setting out particulars of the event.

             (2)  These are the events:

                     (a)  a contravention of a condition to which the approval of the trustee is subject;

                     (b)  if subparagraph 26(1)(b)(i) is designated as the subparagraph on the basis of which the trustee is approved—that subparagraph ceasing to apply to the trustee;

                     (c)  if subparagraph 26(1)(b)(ii) is designated as the subparagraph on the basis of which the trustee is approved—that subparagraph ceasing to apply to the trustee;

                    (ca)  if subparagraph 26(1)(b)(iia) is designated as the subparagraph on the basis of which the trustee is approved—that subparagraph ceasing to apply to the trustee;

                     (d)  if subparagraph 26(1)(b)(iii) is designated as the subparagraph on the basis of which the trustee is approved—the trustee failing to comply with a requirement of APRA under that subparagraph.

             (3)  An approved trustee must not, without reasonable excuse, contravene subsection (1).

Penalty:  250 penalty units.

             (4)  Subsection (3) is an offence of strict liability.

Note 1:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Note 2:       For strict liability, see section 6.1 of the Criminal Code.

 

Part 2A—Licensing of trustees and groups of individual trustees

Division 1—Object of this Part

29A  Object of this Part and the relationship of this Part to other provisions

             (1)  The object of this Part is to set out provisions relating to the granting of RSE licences to:

                     (a)  constitutional corporations; and

                     (b)  other bodies corporate; and

                     (c)  groups of individual trustees.

             (2)  The following is a simplified outline showing some key relationships between this Part and other provisions of the Act and the regulations that trustees should be aware of:

 

Division 2—Classes of RSE licences

29B  Classes of RSE licences

             (1)  There are to be classes of RSE licences.

             (2)  One class of RSE licences is to be a class that enables a trustee that holds a licence of that class to be a trustee of:

                     (a)  any public offer entity; and

                     (b)  any other registrable superannuation entity included in a class of registrable superannuation entities specified in regulations made for the purposes of this subsection;

subject to any condition imposed on that licence under subsection 29EA(3).

Note 1:       An RSE licence of this class is called a public offer entity licence: see subsection 10(1).

Note 2:       Only constitutional corporations may hold public offer entity licences: see paragraph 29D(1)(g).

             (3)  Another class of RSE licences is to be a class that enables a trustee that:

                     (a)  holds a licence of that class; or

                     (b)  is a member of a group of individual trustees that holds a licence of that class;

to be a trustee of any registrable superannuation entity included in a class of registrable superannuation entities (other than a class of public offer entities) specified in regulations made for the purposes of this subsection, subject to any condition imposed on that licence under subsection 29EA(3).

             (4)  The regulations may provide for other classes of RSE licences. For each such class, the regulations must specify the classes of registrable superannuation entities of which a trustee that:

                     (a)  holds a licence of that class; or

                     (b)  is a member of a group of individual trustees that holds a licence of that class;

is enabled to be a trustee, subject to any condition imposed on that licence under subsection 29EA(3).

             (5)  The classes of registrable superannuation entity that the regulations may specify in relation to a particular class of RSE licence may include one or more classes of registrable superannuation entity that the regulations specify in relation to another class of RSE licence.

 

Division 3—Applying for RSE licences

29C  Applications for RSE licences

Who may apply for RSE licences

             (1)  A constitutional corporation may apply to APRA for an RSE licence of any class.

             (2)  A body corporate that is not a constitutional corporation may apply to APRA for an RSE licence of any class other than a class that would enable it to be a trustee of a public offer entity.

             (3)  A group of individual trustees may apply to APRA for an RSE licence of any class other than a class that would enable each of the members of the group to be a trustee of a public offer entity.

Requirements for applications

             (4)  An application for an RSE licence must:

                     (a)  be in the approved form; and

                     (b)  contain the information required by the approved form; and

                     (c)  be accompanied by the application fee (if any) prescribed by regulations made for the purposes of this paragraph; and

                     (d)  be accompanied by an up‑to‑date copy of:

                              (i)  if the applicant is a body corporate—the body corporate’s risk management strategy, signed by the body corporate; or

                             (ii)  if the applicant is a group of individual trustees—the group’s risk management strategy, signed by each member of the group; and

                     (e)  be accompanied by a statement, signed by:

                              (i)  if the applicant is a body corporate—the body corporate; or

                             (ii)  if the applicant is a group of individual trustees—each member of the group;

                            that the risk management strategy complies with section 29H.

             (5)  Regulations made for the purposes of paragraph (4)(c) may prescribe different application fees for applications for different classes of RSE licences.

Notifying certain changes while applications are pending

             (6)  If:

                     (a)  a body corporate applies for an RSE licence; and

                     (b)  after the application is made, but before APRA decides the application, another director is added to, or removed from the board;

the body corporate must notify APRA, in the approved form, about the change to the membership of the board as soon as practicable after that change occurs.

Note:          Part 9 has requirements about equal representation rules.

             (7)  If:

                     (a)  a group of individual trustees applies for an RSE licence; and

                     (b)  after the application is made, but before APRA decides the application, another trustee is added to, or removed from the group;

a member of the group must notify APRA, in the approved form, about the change to the membership of the group as soon as practicable after that change occurs.

Note:          Part 9 has requirements about equal representation rules.

             (8)  If:

                     (a)  a body corporate or group of individual trustees applies for an RSE licence; and

                     (b)  after the application is made but before APRA decides the application, the risk management strategy for the body or group is varied or revoked and replaced;

the body or group must lodge an up‑to‑date copy of the risk management strategy with APRA as soon as practicable after the risk management strategy is varied or revoked and replaced.

             (9)  An application is taken not to comply with this section if subsection (6), (7) or (8) is contravened.

Note:          APRA cannot grant an RSE licence while the application does not comply with this section: see paragraph 29D(1)(c).

29CA  APRA may request further information

             (1)  If a body corporate or group of individual trustees has applied for an RSE licence, APRA may give the body corporate or a member of the group a notice requesting the body or group to give APRA, in writing, specified information relating to the application by a specified time that is reasonable in the circumstances.

             (2)  APRA may decide to treat an application by a body corporate or group of individual trustees for an RSE licence as having been withdrawn if the body or group:

                     (a)  does not comply with a request to provide information under this section; and

                     (b)  does not have a reasonable excuse for not complying.

             (3)  If APRA decides under subsection (2) to treat an application for an RSE licence as having been withdrawn, APRA must take all reasonable steps to ensure that the body that made the application, or a member of the group that made the application, is given a notice informing the body or group of:

                     (a)  APRA’s decision; and

                     (b)  the reasons for that decision;

as soon as practicable after making the decision.

29CB  Period etc. for deciding applications from existing trustees in licensing transition period

Statements of intention to apply

             (1)  A person who was a trustee of a registrable superannuation entity at the start of the licensing transition period may give APRA a written statement that:

                     (a)  is in the approved form; and

                     (b)  indicates whether the person intends to apply under section 29C for an RSE licence; and

                     (c)  lists the registrable superannuation entities that the person intends to apply to have registered under Part 2B if the RSE licence is granted.

Period for deciding applications

             (2)  Subject to subsection (3), APRA must decide an application for an RSE licence before the end of the licensing transition period if:

                     (a)  the application is received by APRA during that period; and

                     (b)  the application is for an RSE licence to be granted to:

                              (i)  a body corporate that was a trustee of a registrable superannuation entity at the start of the licensing transition period; or

                             (ii)  a group of individual trustees that has a member who was a trustee of a registrable superannuation entity at the start of the licensing transition period.

             (3)  At any time in the last 6 months of the licensing transition period, APRA may refuse to consider under subsection (2) any further applications for RSE licences that are received by APRA in the last 6 months before the end of the licensing transition period for RSE licences to be granted to:

                     (a)  bodies corporate that were trustees of registrable superannuation entities at the start of the licensing transition period; or

                     (b)  groups of individual trustees with one or more members who were each a trustee of a registrable superannuation entity at the start of the licensing transition period.

             (4)  If APRA decides to refuse, under subsection (3), to consider under subsection (2) any further applications, APRA must, as soon as practicable after making the decision, publish a notice stating APRA’s decision in a daily newspaper that circulates generally in each State and Territory.

             (5)  If APRA decides to refuse, under subsection (3), to consider under subsection (2) an application, that application is taken, at the end of the licensing transition period, to have been received by APRA immediately after the end of the licensing transition period.

29CC  Period for deciding other applications

             (1)  APRA must decide an application for an RSE licence within 90 days after receiving it if:

                     (a)  the application is received by APRA after the end of the licensing transition period; or

                     (b)  the application is received by APRA during the licensing transition period and is for an RSE license to be granted to:

                              (i)  a body corporate that was not a trustee of a registrable superannuation entity at the start of the licensing transition period; or

                             (ii)  a group of individual trustees that has no members that were a trustee of a registrable superannuation entity at the start of the licensing transition period;

unless APRA extends the period for deciding the application under subsection (2).

             (2)  APRA may extend the period for deciding an application covered by paragraph (1)(a) or (b) by up to 30 days if APRA informs the body corporate, or a member of the group, that made the application of the extension:

                     (a)  in writing; and

                     (b)  within 90 days after receiving the application.

             (3)  If APRA extends the period for deciding the application, it must decide the application within the extended period.

             (4)  If APRA has not decided the application by the end of the period by which it is required to decide the application, APRA is taken to have decided, at the end of the last day of that period, to refuse the application.

 

Division 4—Grant of RSE licences

29D  Grant of RSE licences

             (1)  APRA must grant an RSE licence to a body corporate, or group of individual trustees, that has applied for an RSE licence if, and only if:

                     (a)  APRA has no reason to believe that:

                              (i)  if the application is made by a body corporate—the body corporate; or

                             (ii)  if the application is made by a group of individual trustees—the group as a whole or any member of the group;

                            would fail to comply with the RSE licensee law if the RSE licence were granted; and

                     (b)  APRA has no reason to believe that:

                              (i)  if the application is made by a body corporate—the body corporate; or

                             (ii)  if the application is made by a group of individual trustees—the group as a whole or any member of the group;

                            would fail to comply with any condition imposed on the RSE licence if it were granted; and

                     (c)  the application for the licence complies with section 29C and is for a class of licence that the body corporate or group of individual trustees may apply for under that section; and

                     (d)  APRA is satisfied that:

                              (i)  if the application is made by a body corporate—the body corporate meets the requirements of standards prescribed under Part 3 relating to fitness and propriety for trustees of funds and RSE licensees; or

                             (ii)  if the application is made by a group of individual trustees—the group as a whole meets the requirements of standards prescribed under Part 3 relating to fitness and propriety for RSE licensees and each of the members of the group meets the requirements of standards prescribed under Part 3 relating to fitness and propriety for trustees of funds; and

                     (e)  APRA is satisfied that the risk management strategy for the body corporate or group meets the requirements of section 29H; and

                      (f)  in a case where the applicant is not a constitutional corporation—APRA is satisfied that:

                              (i)  if the application is made by a body corporate—the body corporate; or

                             (ii)  if the application is made by a group of individual trustees—each member of the group;

                            only intends to act as a trustee of one or more superannuation funds that have governing rules providing that the sole or primary purpose of the fund is the provision of old‑age pensions; and

                     (g)  in a case where the application is for a licence of a class that enables a trustee that holds a licence of that class to be a trustee of a public offer entity subject to any condition imposed under subsection 29EA(3)—APRA is satisfied that the applicant is a constitutional corporation that meets the capital requirements under section 29DA; and

                     (h)  the application has not been withdrawn, treated as withdrawn under subsection 29CA(2), refused consideration under subsection 29CB(3) or taken to have been refused under subsection 29CC(4).

Note 1:       Conditions apply to all RSE licences. See Division 5.

Note 2:       An RSE licence may only be granted to a body corporate or a group of individual trustees because only bodies corporate and groups of individual trustees may apply for RSE licences. See section 29C.

             (2)  Otherwise APRA must refuse the application.

29DA  Capital requirements

             (1)  The capital requirements under this section are met by a constitutional corporation if it satisfies at least one of the following subsections.

             (2)  A constitutional corporation satisfies this subsection if APRA is satisfied that the value of the corporation’s net tangible assets is equal to, or greater than, the amount prescribed by regulations made for the purposes of this subsection.

             (3)  A constitutional corporation satisfies this subsection if APRA is satisfied that the corporation is entitled to the benefit of an approved guarantee that:

                     (a)  is of an amount equal to, or greater than, the amount prescribed by regulations made for the purposes of this paragraph; and

                     (b)  is in respect of the corporation’s duties as trustee of each registrable superannuation entity of which it is, or is proposing to become, the trustee.

             (4)  A constitutional corporation satisfies this subsection if APRA is satisfied that:

                     (a)  the corporation is entitled to the benefit of an approved guarantee that is in respect of its duties as trustee of each registrable superannuation entity of which it is, or is proposing to become, the trustee; and

                     (b)  the sum of the amount of the approved guarantee and the value of the corporation’s net tangible assets is equal to, or greater than, the amount prescribed by regulations made for the purposes of this paragraph.

             (5)  A constitutional corporation satisfies this subsection if it has agreed, in writing, to comply with written requirements that:

                     (a)  were given to it by APRA before:

                              (i)  it was granted an RSE licence; or

                             (ii)  its class of RSE licence was varied, resulting in the RSE licensee being required to meet the capital requirements under this section; and

                     (b)  relate to the custody of the assets of each of the registrable superannuation entities of which it is, or is proposing to become, the trustee.

             (6)  In this section:

net tangible assets has the meaning given by the regulations.

29DB  Licence numbers etc.

                   If APRA decides to grant an RSE licence to a body corporate or group of individual trustees, APRA must give the body or group an RSE licence that specifies:

                     (a)  a unique licence number; and

                     (b)  the class of licence.

29DC  Documents required to bear licence numbers

             (1)  An RSE licensee must ensure that the number of its RSE licence is included in:

                     (a)  each document that it gives to APRA in the capacity of an RSE licensee; and

                     (b)  any other document in which it identifies itself as an RSE licensee of a registrable superannuation entity; and

                     (c)  if the RSE licensee is a body corporate—any document in which the body corporate identifies itself as a trustee of a registrable superannuation entity; or

                     (d)  if the RSE licensee is a group of individual trustees—any document in which a member of the group identifies itself as a trustee of a registrable superannuation entity or as a member of a group of individual trustees that are the RSE licensee of a registrable superannuation entity.

             (2)  However, an RSE licensee is not required to comply with subsection (1) in respect of a particular document if it has been given written approval by APRA not to be required to ensure that the number is included in that document or in a class of documents that includes that document.

29DD  Licence period

             (1)  An RSE licence comes into force at the later of:

                     (a)  the time when it is granted; or

                     (b)  the time specified on the licence as the time when it comes into force.

             (2)  An RSE licence continues in force, subject to:

                     (a)  any imposition of licence conditions under Division 5; or

                     (b)  any variation or revocation of the licence conditions, or variation of the licence class, under Division 6;

until the RSE licence is cancelled under Division 7.

29DE  APRA to give notice of refusal of applications

                   If APRA refuses an application by a body corporate or a group of individual trustees for an RSE licence, APRA must take all reasonable steps to ensure that the body or a member of the group is given a notice informing the body or group of:

                     (a)  APRA’s refusal of the application; and

                     (b)  the reasons for that refusal;

as soon as practicable after refusing the application.

 

Division 5—Conditions on RSE licences

29E  Conditions imposed on all licences and on groups of licences

Conditions imposed on all RSE licences

             (1)  The following conditions are imposed on all RSE licences:

                     (a)  the RSE licensee and, if the RSE licensee is a group of individual trustees, each of the members of the group, must comply with the RSE licensee law;

                     (b)  the duties of a trustee in respect of each registrable superannuation entity of which it is an RSE licensee must be properly performed by:

                              (i)  if the RSE licensee is a body corporate—the body corporate; or

                             (ii)  if the RSE licensee is a group of individual trustees—each of the members of the group;

                     (c)  the RSE licensee must have a risk management strategy that complies with Division 8, and must comply with that strategy;

                     (d)  the RSE licensee must ensure that each registrable superannuation entity of which it is the RSE licensee is:

                              (i)  registered under Part 2B; or

                             (ii)  the subject of an application for registration under Part 2B that has not been finally determined or otherwise disposed of;

                     (e)  the RSE licensee must comply with each measure and procedure set out in the risk management plan for each registrable superannuation entity of which it is the RSE licensee;

                      (f)  the RSE licensee must notify APRA of any change in the composition of the RSE licensee (see subsection (2)) within 14 days after the change takes place;

                     (g)  the RSE licensee must comply with any other conditions prescribed by regulations made for the purposes of this paragraph.

Note 1:       Breach of a licence condition may lead to consequences such as a direction from APRA to comply with the condition (see section 29EB) or cancellation of the licence (see section 29G).

Note 2:       An RSE licensee must notify APRA if the RSE licensee breaches a licence condition: see section 29JA.

Note 3:       Additional conditions may be imposed on various types of RSE licences (see subsections (3) to (7)) or a particular RSE licence (see section 29EA).

Change in the composition of the RSE licensee

             (2)  For the purposes of paragraph (1)(f), a change in the composition of the RSE licensee is:

                     (a)  if the RSE licensee is a body corporate—a person becoming, or ceasing to be, a director of the body corporate; or

                     (b)  if the RSE licensee is a group of individual trustees—an individual becoming, or ceasing to be, a member of the group.

Classes enabling RSE licensees to be trustees of public offer entities

             (3)  The following additional conditions are imposed on each RSE licence that enables a trustee that holds a licence of that class to be a trustee of a public offer entity:

                     (a)  the RSE licensee that holds the licence must continue to be a constitutional corporation that meets the capital requirements under section 29DA; and

                     (b)  if the RSE licensee that holds the licence met the capital requirements by satisfying subsection 29DA(5) (and not subsection 29DA(2), (3) or (4)) when APRA granted the licence—the RSE licensee must continue to comply with the written requirements mentioned in that subsection.

Licences held by RSE licensees that are not constitutional corporations

             (4)  The following additional condition is imposed on each RSE licence that is not held by a constitutional corporation:

                     (a)  if the RSE licensee that holds the licence is a body corporate—that the body; or

                     (b)  if the RSE licensee is a group of individual trustees—that the members of the group;

only act as a trustee of superannuation funds that have governing rules providing that the sole or primary purpose of the fund is the provision of old‑age pensions.

Licences held by groups of individual trustees

             (5)  The following additional conditions are imposed on each RSE licence held by a group of individual trustees:

                     (a)  the members of the group must make all reasonable efforts to ensure that the group always has at least 2 members;

                     (b)  any continuous period for which the group has less than 2 members must be 90 days or less.

Note:          Paragraph 29E(1)(f) requires APRA to be notified of any change in the composition of the RSE licensee.

Licences held by RSE licensees of transferee funds

             (6)  An additional condition is imposed on each RSE licence held by an RSE licensee of a fund that has had benefits of members and beneficiaries transferred to it from a transferor fund under Part 18 (whether while the RSE licensee was the RSE licensee of the fund or earlier). The condition is that, while the RSE licensee is the RSE licensee of the fund, the RSE licensee assumes the obligation to pay benefits to those who were members or beneficiaries of the transferor fund immediately before the transfer.

Prescribed conditions imposed on classes of licences

             (7)  An additional condition prescribed by a regulation made for the purposes of this subsection as a condition applying to all RSE licences of a specified class is imposed on each RSE licence of that class.

             (8)  A specified class mentioned in subsection (7) may be a class other than a class provided for under subsection 29B(2) or (3) or under regulations made for the purposes of subsection 29B(4).

29EA  Additional conditions imposed on individual licences by APRA

             (1)  APRA may, at any time, impose an additional condition on an RSE licence by giving the RSE licensee a notice setting out the additional condition.

             (2)  A condition imposed under subsection (1) must not be inconsistent with any condition imposed by, or under, section 29E on an RSE licence.

Note 1:       Breach of a licence condition may lead to consequences such as a direction from APRA to comply with the condition (see section 29EB) or cancellation of the licence (see section 29G).

Note 2:       An RSE licensee must notify APRA if the RSE licensee breaches a licence condition: see section 29JA.

Note 3:       RSE licensees may apply to APRA to have conditions imposed under this section varied or revoked: see section 29F.

             (3)  Without limiting subsection (1), an additional condition imposed under that subsection on an RSE licence may provide that the body corporate that is the RSE licensee, or each of the members of a group of individual trustees that is the RSE licensee, must not act as a trustee under that RSE licence for a registrable superannuation entity other than:

                     (a)  a registrable superannuation entity specified in the condition; or

                     (b)  a registrable superannuation entity included in the class of registrable superannuation entities specified in the condition.

             (4)  Without limiting subsection (1), an additional condition imposed under that subsection on an RSE licence may provide that the RSE licensee must ensure that a fund specified in the condition, or in a class of funds specified in the condition, must comply with the alternative agreed representation rules whenever section 92 applies to the fund. However, before imposing such a condition, APRA must have regard to any written guidelines determined by APRA under this subsection.

             (5)  If the RSE licensee is also a financial services licensee:

                     (a)  APRA must consult ASIC before imposing a condition that, in APRA’s opinion, might reasonably be expected to affect the RSE licensee’s ability to provide one or more of the financial services (within the meaning of the Corporations Act 2001) that the RSE licensee provides; and

                     (b)  APRA must inform ASIC about the imposition of any condition not covered by paragraph (a) within one week after the condition is imposed.

             (6)  A failure to comply with a requirement of subsection (5) does not invalidate the imposition of any condition.

             (7)  An additional condition imposed under this section comes into force on the later of:

                     (a)  the day on which APRA gives the RSE licensee the notice of the condition; or

                     (b)  the day specified in the notice as the day on which the condition comes into force.

29EB  Directions to comply with licence conditions

                   APRA may direct an RSE licensee to comply with a specified condition of its RSE licence by a specified time if APRA has reasonable grounds to believe that the RSE licensee has breached the condition. The direction must:

                     (a)  be by notice in writing given to the RSE licensee; and

                     (b)  specify a time that is reasonable in the circumstances.

Note:          A failure to comply with a direction may lead to cancellation of the RSE licence (see section 29G) and may be an offence (see section 29JB).

 

Division 6—Varying RSE licences

29F  Applications for variation of RSE licences

             (1)  An RSE licensee may apply to APRA for one or both of the following:

                     (a)  variation of its RSE licence so that the RSE licence is an RSE licence of a different class;

                     (b)  variation or revocation of a condition that APRA has imposed on its RSE licence under section 29EA.

             (2)  An application under this section must:

                     (a)  be in the approved form; and

                     (b)  contain the information required by the approved form; and

                     (c)  if the application is for a variation of an RSE licence so that it is an RSE licence of a different class—be accompanied by the application fee (if any) prescribed for the type of variation by regulations made for the purposes of this paragraph.

29FA  APRA may request further information

             (1)  APRA may give an RSE licensee that makes an application under section 29F a notice requesting the RSE licensee to give APRA, in writing, specified information relating to the application by a specified time that is reasonable in the circumstances.

             (2)  APRA may decide to treat an application under section 29F as having been withdrawn if the RSE licensee:

                     (a)  does not comply with a request to provide information under this section; and

                     (b)  does not have a reasonable excuse for not complying.

             (3)  If APRA decides to treat an application under section 29F as having been withdrawn, APRA must take all reasonable steps to ensure that the RSE licensee is given a notice informing the RSE licensee of:

                     (a)  APRA’s decision; and

                     (b)  the reasons for that decision;

as soon as practicable after making the decision.

29FB  Period for deciding applications

             (1)  APRA must decide an application under section 29F within 60 days of receiving the application, unless APRA extends the period for deciding the application under subsection (2).

             (2)  APRA may extend the period for deciding an application under section 29F by up to 60 days if APRA informs the RSE licensee of the extension:

                     (a)  in writing; and

                     (b)  within 60 days of receiving the application.

             (3)  If APRA extends the period for deciding an application under section 29F, it must decide the application within the extended period.

             (4)  If APRA has not decided an application under section 29F by the end of the period by which it is required to decide the application, APRA is taken to have decided, at the end of the last day of that period, to refuse the application.

29FC  APRA may vary RSE licences in accordance with applications

             (1)  APRA may, by notice to an RSE licensee:

                     (a)  vary the RSE licensee’s RSE licence so that it is an RSE licence of a different class; or

                     (b)  vary or revoke a condition that APRA has imposed on the RSE licence under section 29EA;

in accordance with an application under section 29F.

             (2)  However:

                     (a)  an RSE licence must not be varied so that it becomes an RSE licence of a particular class unless APRA is satisfied that the RSE licensee will comply with any conditions imposed on that class of RSE licence; and

                     (b)  a condition as varied under paragraph (1)(b) must not be inconsistent with any condition imposed by section 29E; and

                     (c)  if the RSE licensee is also a financial services licensee:

                              (i)  APRA must consult ASIC before varying the RSE licence so that it is an RSE licence of a different class, if, in APRA’s opinion, the variation might reasonably be expected to affect the RSE licensee’s ability to provide one or more of the financial services (within the meaning of the Corporations Act 2001) that the RSE licensee provides; and

                             (ii)  APRA must consult ASIC before varying or revoking a condition that, in APRA’s opinion, might reasonably be expected to affect the RSE licensee’s ability to provide one or more of the financial services (within the meaning of the Corporations Act 2001) that the RSE licensee provides; and

                            (iii)  APRA must consult ASIC before varying a condition so that it would, in APRA’s opinion, become a condition that might reasonably be expected to have an effect as described in subparagraph (ii); and

                            (iv)  APRA must inform ASIC about the variation or revocation of any condition not covered by subparagraph (i), (ii) or (iii) within one week after the condition is varied or revoked.

             (3)  A failure to comply with a requirement of paragraph (2)(c) does not invalidate:

                     (a)  the variation of an RSE licence so that it is an RSE licence of a different class; or

                     (b)  the variation or revocation of a licence condition.

             (4)  APRA is not required to vary the class of, or vary or revoke any condition of, an RSE licence in the terms requested by an RSE licensee in an application under section 29F.

29FD  APRA may vary or revoke licence conditions on its own initiative

             (1)  APRA may, on its own initiative, vary or revoke any condition that it imposed on an RSE licence under section 29EA.

             (2)  However:

                     (a)  a condition as varied under subsection (1) must not be inconsistent with any condition imposed by section 29E; and

                     (b)  if the RSE licensee that holds the licence is also a financial services licensee:

                              (i)  APRA must consult ASIC before varying or revoking a condition that, in APRA’s opinion, might reasonably be expected to affect the RSE licensee’s ability to provide one or more of the financial services (within the meaning of the Corporations Act 2001) that the RSE licensee provides; and

                             (ii)  APRA must consult ASIC before varying a condition so that it would, in APRA’s opinion, become a condition that might reasonably be expected to have an effect as described in subparagraph (i); and

                            (iii)  APRA must inform ASIC about the variation or revocation of any condition not covered by subparagraph (i) or (ii) within one week after the condition is varied or revoked.

             (3)  A failure to comply with a requirement of paragraph (2)(b) does not invalidate the variation or revocation of a condition.

29FE  Notification of APRA’s decisions under this Division

             (1)  APRA must give a notice to an RSE licensee if APRA:

                     (a)  varies the RSE licensee’s RSE licence under section 29FC so that it is an RSE licence of a different class; or

                     (b)  varies or revokes, under section 29FC or 29FD, a condition that APRA imposed on the RSE licence under section 29EA.

             (2)  The notice must:

                     (a)  if paragraph (1)(a) applies—specify the class of the RSE licence after the variation; and

                     (b)  if paragraph (1)(b) applies:

                              (i)  identify the licence condition being varied or revoked; and

                             (ii)  specify any conditions imposed under section 29EA to which the licence is subject after the variation or revocation comes into force; and

                     (c)  state the reasons for the variation or revocation; and

                     (d)  specify the day, not earlier than the day on which APRA gives the notice, on which the variation or revocation comes into force.

             (3)  If APRA refuses an application for a variation or revocation under section 29FC, APRA must take all reasonable steps to ensure that the RSE licensee that made the application is given a notice informing it of:

                     (a)  APRA’s refusal of the application; and

                     (b)  the reasons for the refusal;

as soon as practicable after refusing the application.

29FF  When variations or revocations come into force etc.

             (1)  If, under section 29FC, APRA varies an RSE licence so that it is an RSE licence of a different class:

                     (a)  the variation comes into force on the day specified in the notice under paragraph 29FE(2)(d); and

                     (b)  the variation remains in force until:

                              (i)  the licence is again varied so that it is an RSE licence of a different class; or

                             (ii)  the licence is cancelled.

             (2)  If, under section 29FC or 29FD, APRA varies a condition imposed on an RSE licence:

                     (a)  the variation comes into force on the day specified in the notice under paragraph 29FE(2)(d); and

                     (b)  the variation remains in force until:

                              (i)  the condition is varied in an inconsistent manner; or

                             (ii)  the condition is revoked; or

                            (iii)  the licence is cancelled.

             (3)  If, under section 29FC or 29FD, APRA revokes a condition imposed on an RSE licence, the revocation comes into force on the day specified in the notice under paragraph 29FE(2)(d).

 

Division 7—Cancelling RSE licences

29G  Cancellation of RSE licences

             (1)  Subject to subsection (3), APRA may, in writing, cancel an RSE licence.

Note:          In some circumstances, APRA needs the consent of the Minister (see subsection (3)) or must inform or consult ASIC (see section 29GA).

             (2)  Without limiting subsection (1), APRA may cancel an RSE licence under that subsection if:

                     (a)  the RSE licensee has requested, in the approved form, that the licence be cancelled; or

                     (b)  the RSE licensee is a body corporate and is a disqualified person for the purposes of Part 15; or

                     (c)  the RSE licensee has breached a condition imposed on the licence; or

                     (d)  APRA has reason to believe that the RSE licensee will breach a condition imposed on the licence; or

                     (e)  the RSE licensee has failed to comply with a direction by APRA under section 29EB; or

                      (f)  APRA has reason to believe that the RSE licensee will fail to comply with a direction by APRA under section 29EB.

             (3)  APRA must not cancel an RSE licence under subsection (1) without the Minister’s written consent, unless paragraph (2)(a) or (b) applies to the cancellation.

             (4)  If APRA cancels an RSE licence it must take all reasonable steps to ensure that the body corporate or a member of the group that held the RSE licensee is given a notice informing the body corporate or group:

                     (a)  that APRA has cancelled the licence; and

                     (b)  of the reasons for the cancellation.

29GA  Cancellation of RSE licences of financial services licensees

             (1)  Before cancelling the RSE licence of an RSE licensee that is also a financial services licensee, APRA must consult ASIC if, in APRA’s opinion, the cancellation might reasonably be expected to affect the RSE licensee’s ability to provide one or more of the financial services (within the meaning of the Corporations Act 2001) that the RSE licensee provides.

             (2)  If APRA cancels the RSE licence of an RSE licensee that is also a financial services licensee, APRA must inform ASIC of the cancellation within one week after the cancellation.

             (3)  A failure to comply with a requirement of this section does not invalidate the cancellation of an RSE licence.

29GB  APRA may allow RSE licence to continue in effect

                   In a notice that APRA gives to an RSE licensee cancelling its RSE licence, APRA may specify that the RSE licence continues in effect as though the cancellation had not happened for the purposes of:

                     (a)  a specified provision, administered by APRA, of this Act or the regulations; or

                     (b)  a specified provision, administered by APRA, of any other law of the Commonwealth;

in relation to specified matters, a specified period, or both.

 

Division 8—Risk management strategies

Subdivision A—Contents of risk management strategies

29H  Contents of risk management strategies

             (1)  A risk management strategy must set out reasonable measures and procedures that a body corporate or group of individual trustees is to apply to identify, monitor and manage risks that arise:

                     (a)  in relation to its activities, or proposed activities, as an RSE licensee; and

                     (b)  in relation to all its other activities, or proposed activities, to the extent that they are relevant to its activities, or proposed activities, as an RSE licensee.

             (2)  Without limiting subsection (1), the risk management strategy of a body corporate or group of individual trustees must set out:

                     (a)  reasonable measures and procedures that the body or group is to apply to identify, monitor and manage:

                              (i)  the risks associated with governance and decision‑making processes; and

                             (ii)  the risks that arise as a result of entering into outsourcing arrangements (other than arrangements that relate only to a particular registrable superannuation entity); and

                            (iii)  the risks arising from any changes to the RSE licensee law; and

                            (iv)  the risks of potential fraud and theft; and

                     (b)  the circumstances in which an audit of the risks referred to in this section is to be undertaken; and

                     (c)  such other matters as are prescribed by regulations made for the purposes of this paragraph.

             (3)  The risk management strategy must be signed:

                     (a)  if it is the risk management strategy of a body corporate—by the body; or

                     (b)  if it is the risk management strategy of a group of individual trustees—by each member of the group.

Note:          An RSE licence will not be granted unless there is a risk management strategy that meets the requirements of this section: see paragraph 29D(1)(e).

             (4)  The risk management strategy must not by reference incorporate provisions of any other document unless that other document is available, without charge, to members of the public.

             (5)  A risk management strategy does not fail to comply with this section merely because it reproduces information contained in the risk management plan for an entity of which an applicant for an RSE licence is, or proposes to be, the RSE licensee.

Subdivision B—Maintaining and reviewing risk management strategies

29HA  Requirement to maintain and review risk management strategies

             (1)  An RSE licensee must:

                     (a)  ensure that at all times its risk management strategy is up to date; and

                     (b)  ensure that its risk management strategy is reviewed at least once each year to ensure that it complies with section 29H; and

                     (c)  modify, or replace, its risk management strategy in accordance with section 29HB if at any time the RSE licensee becomes aware that the risk management strategy no longer complies with section 29H.

             (2)  An RSE licensee must review its risk management strategy within 60 days after the RSE licensee:

                     (a)  becomes the RSE licensee of a registrable superannuation entity (other than a registrable superannuation entity of which, at the time of the application for an RSE licence, the RSE licensee proposed to become the RSE licensee); or

                     (b)  becomes an acting trustee appointed under Part 17 of a superannuation entity following the suspension or removal of a former trustee of the entity under that Part.

However, this subsection does not apply if review of the RSE licensee’s risk management strategy is due under paragraph (1)(b) within the 60 days after the RSE licensee becomes an RSE licensee, or trustee, of the entity.

Note:          Only a person may be appointed as an acting trustee under Part 17: see section 134.

29HB  Modifications etc. to risk management strategies

             (1)  An RSE licensee may:

                     (a)  modify its risk management strategy; or

                     (b)  repeal its risk management strategy and replace it with a new risk management strategy.

             (2)  However, after the modification or the repeal and replacement, the risk management strategy must comply with section 29H.

             (3)  APRA may direct an RSE licensee to modify its risk management strategy as set out in the direction, by a specified time, to ensure that the strategy complies with section 29H. The direction is to be given by notice to the RSE licensee.

Note:          A failure to comply with a direction may be an offence: see section 29JC.

             (4)  A time specified in a direction given to an RSE licensee under subsection (3) must be at least 14 days after the direction is given to the RSE licensee.

29HC  Notification of modifications etc. to risk management strategies

             (1)  If an RSE licensee modifies its risk management strategy, the RSE licensee must give APRA:

                     (a)  a copy of the modification; and

                     (b)  a copy of the strategy as modified;

within 14 days after making the modification.

             (2)  If an RSE licensee repeals its risk management strategy (the old strategy) and replaces it with another risk management strategy (the new strategy), the RSE licensee must give APRA:

                     (a)  a copy of the new strategy; and

                     (b)  a written statement to the effect that the new strategy replaces the old strategy;

within 14 days after the old strategy is repealed.

             (3)  Any copy or statement given to APRA by an RSE licensee under this section must be signed by the RSE licensee.

Note:          If the RSE licensee is a group of individual trustees, the copy or statement must be signed by each of the members of the group: see subsection 13A(6).

             (4)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  the RSE licensee is in breach of subsection (1), (2) or (3).

Penalty:  50 penalty units.

             (5)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  the RSE licensee is in breach of subsection (1), (2) or (3).

This is an offence of strict liability.

Penalty:  25 penalty units.

Note 1:       For strict liability, see section 6.1 of the Criminal Code.

Note 2:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

Subdivision C—Miscellaneous

29HD  APRA to be given information

             (1)  APRA may give an RSE licensee a notice requesting it to give APRA, in a specified way, specified information relating to its risk management strategy by a specified time that is reasonable in the circumstances.

             (2)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  there has been a failure by the RSE licensee to comply with a notice under subsection (1).

Penalty:  50 penalty units.

             (3)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  there has been a failure by the RSE licensee to comply with a notice under subsection (1).

This is an offence of strict liability.

Penalty:  25 penalty units.

Note 1:       For strict liability, see section 6.1 of the Criminal Code.

Note 2:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

Note 3:       Sections 137.1 and 137.2 of the Criminal Code also create offences for providing false or misleading information or documents.

             (4)  Subsection (2) or (3) does not apply if the RSE licensee has a reasonable excuse for the failure to comply with the notice under subsection (1).

Note:          A defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).

 

Division 9—Offences and self‑incrimination

29J  Being trustee of a registrable superannuation entity while unlicensed etc.

             (1)  A person who was not a trustee of a registrable superannuation entity at the start of the licensing transition period must not be a trustee, or act as a trustee, of a registrable superannuation entity at a time during that period, unless at that time at least one of the following paragraphs apply:

                     (a)  the person holds an RSE licence that enables the person to be the trustee of the entity;

                     (b)  the person is a member of a group of individual trustees that holds an RSE licence that enables the members of the group to each be a trustee of the entity;

                     (c)  the person has been a trustee of the entity for less than 30 days and that entity has at least one other trustee who has been a trustee of it from immediately before the start of the licensing transition period until that time;

                     (d)  the person, and at least one other trustee of the entity who has been a trustee of it from immediately before the start of the licensing transition period until that time, have applied for an RSE licence that would enable them to be a trustee of that entity and the application has not been finally determined or disposed of;

                     (e)  the person is an approved trustee.

             (2)  Despite subsection 13.3(3) of the Criminal Code, a defendant does not bear an evidential burden in relation to any matter in subsection (1) of this section.

             (3)  A person that contravenes subsection (1) commits an offence.

Penalty:  Imprisonment for 2 years, or 120 penalty units, or both.

Note:          Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

             (4)  A person must not be a trustee of a registrable superannuation entity, or act as a trustee of a registrable superannuation entity, if the person:

                     (a)  is a body corporate; and

                     (b)  is not the only trustee of the registrable superannuation entity.

             (5)  A person that contravenes subsection (4) commits an offence.

Penalty:  Imprisonment for 2 years, or 120 penalty units, or both.

Note:          Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

             (6)  This section does not prevent an RSE licensee from engaging or authorising persons to act on its behalf.

29JA  Failing to notify breach of licence condition

             (1)  An RSE licensee must give APRA a notice setting out the particulars of a breach by the RSE licensee of a condition imposed on its RSE licence as soon as practicable after, and in any event within 14 days after:

                     (a)  if the RSE licensee is a body corporate—the body corporate; or

                     (b)  if the RSE licensee is a group of individual trustees—a member of the group;

becomes aware that the breach has occurred.

             (2)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  the RSE licensee is in breach of subsection (1).

Penalty:  50 penalty units.

             (3)  Subsection (2) is an offence of strict liability.

Note 1:       For strict liability, see section 6.1 of the Criminal Code.

Note 2:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

29JB  Not complying with direction to comply with licence conditions

             (1)  An RSE licensee must comply with a direction given to it under section 29EB within the time specified in the direction.

             (2)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  the RSE licensee is in breach of subsection (1).

Penalty:  60 penalty units.

             (3)  Subsection (2) is an offence of strict liability.

Note 1:       For strict liability, see section 6.1 of the Criminal Code.

Note 2:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

29JC  Not complying with direction to modify risk management strategy

             (1)  An RSE licensee must comply with a direction given to it under section 29HB within the time specified in the direction.

             (2)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  the RSE licensee is in breach of subsection (1).

Penalty:  60 penalty units.

             (3)  Subsection (2) is an offence of strict liability.

Note 1:       For strict liability, see section 6.1 of the Criminal Code.

Note 2:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

29JD  Breach does not affect validity of issue of superannuation interests etc.

                   A breach of section 29J, 29JA, 29JB or 29JC does not affect the validity of the issue of a superannuation interest or of any other act.

29JE  Self incrimination

             (1)  An individual is not excused from complying with a requirement under section 29CA, 29FA or 29HD to give information on the ground that doing so would tend to incriminate the individual or make the individual liable to a penalty.

             (2)  The information given by the individual in compliance with such a requirement is not admissible in evidence against the individual in a criminal proceeding or a proceeding for the imposition of a penalty, other than a proceeding in respect of the falsity of the information, if:

                     (a)  before giving the information, the individual claims that giving the information might tend to incriminate the individual or make the individual liable to a penalty; and

                     (b)  giving the information might in fact tend to incriminate the individual or make the individual liable to a penalty.

 

Part 2B—Registrable superannuation entities

Division 1—Object of this Part

29K  Object etc. of this Part

             (1)  The object of this Part is to provide for the registration of registrable superannuation entities.

             (2)  Registration is significant because an RSE licensee may breach the licence condition imposed by paragraph 29E(1)(d) if a registrable superannuation entity of which it is the RSE licensee is not registered.

Note:          Breach of a licence condition may lead to consequences such as a direction from APRA to comply with the condition (see section 29EB) or cancellation of the licence (see section 29G).

 

Division 2—Applying for registration

29L  Applications for registration

Who may apply for registration

             (1)  An RSE licensee may apply to APRA for registration of a registrable superannuation entity.

Requirements for applications

             (2)  An application for registration of a registrable superannuation entity must:

                     (a)  be in the approved form; and

                     (b)  contain the information required by the approved form; and

                     (c)  be accompanied by an up‑to‑date copy of the trust deed by which the registrable superannuation entity is constituted (except to the extent that the trust deed is constituted by the governing rules of the entity); and

                     (d)  be accompanied by an up‑to‑date copy of the governing rules of the registrable superannuation entity (except to the extent that the governing rules are constituted by the law of the Commonwealth or by unwritten rules); and

                     (e)  be accompanied by an up‑to‑date copy of the risk management plan for the registrable superannuation entity, signed by the RSE licensee that made the application; and

                      (f)  be accompanied by a statement, signed by the RSE licensee that made the application, to the effect that the risk management plan accompanying the application complies with section 29P.

Note:          If the RSE licensee is a group of individual trustees, the copy or statement must be signed by each of the members of the group: see subsection 13A(6).

Notifying certain changes while applications are pending

             (3)  If:

                     (a)  an RSE licensee applies for registration of a registrable superannuation entity; and

                     (b)  after the application is made but before APRA decides the application, the trust deed (other than the governing rules of the entity) by which the entity is constituted is varied or revoked and replaced;

the RSE licensee must lodge an up‑to‑date copy of the trust deed with APRA as soon as practicable after the trust deed is varied or revoked and replaced.

             (4)  If:

                     (a)  an RSE licensee applies for registration of a registrable superannuation entity; and

                     (b)  after the application is made but before APRA decides the application, any governing rules of the entity (that are not constituted by the law of the Commonwealth or by unwritten rules) are varied or revoked and replaced;

the RSE licensee must lodge an up‑to‑date copy of the governing rules (that are not constituted by the law of the Commonwealth or by unwritten rules) with APRA as soon as practicable after the governing rules are varied or revoked and replaced.

             (5)  If:

                     (a)  an RSE licensee applies for registration of a registrable superannuation entity; and

                     (b)  after the application is made but before APRA decides the application, the risk management plan for the entity is varied or revoked and replaced;

the RSE licensee must lodge an up‑to‑date copy of the risk management plan with APRA as soon as practicable after the risk management plan is varied or revoked and replaced.

             (6)  An application is taken not to comply with this section if subsection (3), (4) or (5) is contravened.

Note:          APRA cannot register an entity while the application does not comply with this section: see paragraph 29M(1)(a).

Lapsed applications

             (7)  An application for registration lapses if:

                     (a)  it was made by an RSE licensee; and

                     (b)  the RSE licensee ceases to be an RSE licensee before:

                              (i)  APRA makes a decision on the application for registration; or

                             (ii)  if APRA’s decision with respect to the application is subject to review under this Act—before the review is finally determined or otherwise disposed of.

29LA  APRA may request further information

                   APRA may give an RSE licensee that has applied for registration of a registrable superannuation entity a notice requesting the RSE licensee to give APRA, in writing, specified information relating to the application.

Note:          A failure to give the requested information delays the time within which APRA must decide the application: see paragraph 29LB(1)(b).

29LB  Period for deciding applications for registration

             (1)  APRA must decide an application by an RSE licensee for registration of a registrable superannuation entity:

                     (a)  within 21 days after receiving the application; or

                     (b)  if the applicant was requested to provide information under section 29LA—within 21 days after:

                              (i)  receiving from the RSE licensee all of the information the RSE licensee was requested to provide under that section; or

                             (ii)  all notices relating to that information being disposed of;

unless APRA extends the period for deciding the application under subsection (2).

             (2)  APRA may extend the period for deciding an application by an RSE licensee for registration of a registrable superannuation entity by up to 7 days if APRA informs the RSE licensee of the extension:

                     (a)  in writing; and

                     (b)  within the period in which it would otherwise be required to decide the application under subsection (1).

             (3)  If APRA extends the period for deciding an application for registration of a registrable superannuation entity, it must decide the application within the extended period.

             (4)  If APRA has not decided an application for registration of a registrable superannuation entity by the end of the period by which it is required to decide the application, APRA is taken to have decided, at the end of the last day of that period, to refuse the application.

 

Division 3—Registration

29M  Registration of registrable superannuation entity

             (1)  APRA must register a registrable superannuation entity if, and only if:

                     (a)  the application for registration complies with section 29L; and

                     (b)  the applicant has provided to APRA all information that the applicant was requested, under section 29LA, to provide, or the request has been disposed of; and

                     (c)  APRA is satisfied that nothing in the governing rules of the entity conflicts with Part 6; and

                     (d)  APRA is satisfied that the risk management plan for the entity meets the requirements of section 29P; and

                     (e)  the applicant for registration holds an RSE licence that enables:

                              (i)  if the applicant is a body corporate—the body corporate; or

                             (ii)  if the applicant is a group of individual trustees—each member of the group;

                            to be a trustee of that entity.

             (2)  Otherwise APRA must refuse to register the entity.

29MA  Registration numbers etc.

                   If APRA registers a registrable superannuation entity, APRA must:

                     (a)  allocate the entity a unique registration number; and

                     (b)  notify the RSE licensee of the entity in writing of the registration and of the entity’s registration number.

29MB  Documents required to bear registration numbers

             (1)  After a registrable superannuation entity is registered, the RSE licensee of the entity must ensure that the entity’s registration number is included in:

                     (a)  each document that the RSE licensee gives to APRA that relates to the entity; and

                     (b)  any other document in which the RSE licensee identifies itself as the RSE licensee of the entity; and

                     (c)  if the RSE licensee is a body corporate—any document in which the body corporate identifies itself as a trustee of the entity; and

                     (d)  if the RSE licensee is a group of individual trustees—any document that a member of the group gives to APRA or in which a member of the group identifies itself as a trustee of the entity or as a member of a group of individual trustees that are the RSE licensee of the entity.

             (2)  However, an RSE licensee is not required to comply with subsection (1) in respect of a particular document if the RSE licensee has been given written approval by APRA not to ensure that the number is included in that document or in a class of documents that includes that document.

29MC  APRA to give notice of refusal of applications

                   If APRA refuses an application by an RSE licensee for registration of a registrable superannuation entity, APRA must take all reasonable steps to ensure that the RSE licensee is given a notice:

                     (a)  informing it of APRA’s refusal of the application; and

                     (b)  setting out the reasons for the refusal;

as soon as practicable after refusing the application.

 

Division 4—Cancelling registration

29N  Cancelling registration

             (1)  APRA must cancel the registration of a registrable superannuation entity if a document that:

                     (a)  is a reporting document within the meaning of the Financial Sector (Collection of Data) Act 2001; and

                     (b)  relates to the entity; and

                     (c)  was given to APRA under that Act;

states that the entity has been wound up.

             (2)  APRA may cancel the registration of a registrable superannuation entity if APRA is satisfied, on reasonable grounds, that:

                     (a)  the entity has no beneficiaries and no assets; and

                     (b)  there are no outstanding claims against the entity for benefits or other payments; and

                     (c)  other circumstances (if any) prescribed by regulations made for the purposes of this paragraph exist.

             (3)  If APRA cancels the registration of a registrable superannuation entity under subsection (2), APRA must take all reasonable steps to ensure that the RSE licensee of the entity is given a notice:

                     (a)  stating that APRA has cancelled the registration of the entity; and

                     (b)  setting out the reasons for the cancellation;

as soon as practicable after cancelling the registration of the entity.

 

Division 5—Risk management plans

Subdivision A—Contents of risk management plans

29P  Contents of risk management plans

             (1)  The risk management plan for a registrable superannuation entity must set out reasonable measures and procedures that the RSE licensee of the entity is to apply to identify, monitor and manage the risks that arise in operating the entity.

             (2)  Without limiting subsection (1), the risk management plan for a registrable superannuation entity must set out:

                     (a)  reasonable measures and procedures that the RSE licensee of the entity is to apply to identify, monitor and manage:

                              (i)  the risks to the investment strategy relevant to the entity; and

                             (ii)  the risks to the entity’s financial position; and

                            (iii)  the risks from entering into outsourcing arrangements relating to the entity; and

                     (b)  the circumstances in which an audit of the risks referred to in this section is to be undertaken; and

                     (c)  such other matters as are prescribed by regulations made for the purposes of this paragraph.

             (3)  The risk management plan must be signed by the RSE licensee of the entity.

Note:          If the RSE licensee is a group of individual trustees, the plan must be signed by each of the individual trustees: see subsection 13A(6).

             (4)  The risk management plan must not by reference incorporate provisions of any other document unless that other document is available, without charge, to members of the public.

             (5)  A risk management plan does not fail to comply with the above section merely because it reproduces information contained in the risk management strategy of the RSE licensee of the entity or in a risk management plan for another entity that has the same RSE licensee.

Subdivision B—Maintaining and reviewing risk management plans

29PA  Requirement to maintain and review risk management plans

             (1)  An RSE licensee of a registrable superannuation entity that has been registered under this Part must:

                     (a)  ensure that at all times the risk management plan for the entity is up‑to‑date; and

                     (b)  ensure that the risk management plan for the entity is reviewed at least once each year to ensure that it complies with section 29P; and

                     (c)  modify, or replace, the risk management plan for the entity in accordance with section 29PB if at any time the trustee becomes aware that the risk management plan no longer complies with section 29P.

             (2)  An RSE licensee of a registrable superannuation entity must review the risk management plan for the entity within 60 days after the RSE licensee:

                     (a)  becomes the RSE licensee of the entity (unless the entity is a registrable superannuation entity of which, at the time of the application for an RSE license, the RSE licensee proposed to become the RSE licensee); or

                     (b)  becomes an acting trustee appointed under Part 17 of a superannuation entity following the suspension or removal of a former trustee of the entity under that Part.

However, this subsection does not apply if a review of the risk management plan is due under paragraph (1)(b) within the 60 days after the RSE licensee becomes the RSE licensee, or trustee, of the entity.

Note:          Only a person may be appointed as an acting trustee under Part 17: see section 134.

29PB  Modifications etc. to risk management plans

             (1)  An RSE licensee of a registrable superannuation entity that has been registered under this Part may:

                     (a)  modify the risk management plan for the entity; or

                     (b)  repeal the risk management plan for the entity and replace it with a new risk management plan.

             (2)  However, after the modification or the repeal and replacement, the risk management plan must comply with section 29P.

             (3)  APRA may direct an RSE licensee of a registrable superannuation entity that has been registered under this Part to modify the risk management plan for the entity, as set out in the direction, by a specified time, to ensure that the plan complies with section 29P. The direction is to be given by notice to the RSE licensee.

Note:          A failure to comply with a direction may be an offence: see section 29Q.

             (4)  A time specified in a direction given to an RSE licensee under subsection (3) must be at least 14 days after the direction is given to the RSE licensee.

29PC  Notification of modifications etc. to risk management plans

             (1)  If an RSE licensee modifies a risk management plan for a registrable superannuation entity that has been registered under this Part, the RSE licensee must give APRA:

                     (a)  a copy of the modification; and

                     (b)  a copy of the plan as modified;

within 14 days after making the modification.

             (2)  If an RSE licensee repeals a risk management plan (the old plan) for a registrable superannuation entity that has been registered under this Part and replaces it with another risk management plan (the new plan), the RSE licensee must give APRA:

                     (a)  a copy of the new plan; and

                     (b)  a written statement to the effect that the new plan replaces the old plan;

within 14 days after the old plan is repealed.

             (3)  Any copy or statement given to APRA under this section must be signed by the RSE licensee.

Note:          If the RSE licensee is a group of individual trustees, the copy or statement must be signed by each of the individual trustees: see subsection 13A(6).

             (4)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  the RSE licensee is in breach of subsection (1), (2) or (3).

Penalty:  50 penalty units.

             (5)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  the RSE licensee is in breach of subsection (1), (2) or (3).

This is an offence of strict liability.

Penalty:  25 penalty units.

Note 1:       For strict liability, see section 6.1 of the Criminal Code.

Note 2:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

Subdivision C—Miscellaneous

29PD  Access to risk management plans

             (1)  If a member or unit holder of a registrable superannuation entity that has been registered under this Part requests a copy of the risk management plan for the entity, the RSE licensee of the entity must make a copy of the plan available, without charge, to the member or unit holder as soon as practicable after the RSE licensee receives the request.

             (2)  If an employer‑sponsor of a registrable superannuation entity that:

                     (a)  has been registered under this Part; and

                     (b)  is a defined benefit fund;

requests a copy of the risk management plan for the entity, the RSE licensee of the entity must make a copy of the plan available, without charge, to the employer‑sponsor as soon as practicable after the RSE licensee receives the request.

29PE  APRA to be given information

             (1)  APRA may give an RSE licensee of a registrable superannuation entity that has been registered under this Part a notice requesting the RSE licensee to give APRA, in a specified way, specified information relating to the risk management plan for the entity by a specified time that is reasonable in the circumstances.

             (2)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  there has been a failure by the RSE licensee to comply with the notice.

Penalty:  50 penalty units.

             (3)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  there has been a failure by the RSE licensee to comply with the notice.

This is an offence of strict liability.

Penalty:  25 penalty units.

Note 1:       For strict liability, see section 6.1 of the Criminal Code.

Note 2:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

Note 3:       Sections 137.1 and 137.2 of the Criminal Code also create offences for providing false or misleading information or documents.

             (4)  Subsection (2) or (3) does not apply if the RSE licensee has a reasonable excuse for the failure to comply with the notice under subsection (1).

Note:          A defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).

 

Division 6—Offences and self‑incrimination

29Q  Not complying with direction to modify risk management plan

             (1)  An RSE licensee must comply with a direction given to it under section 29PB within the time specified in the direction.

             (2)  A person commits an offence if:

                     (a)  the person is:

                              (i)  a body corporate that is an RSE licensee; or

                             (ii)  a member of a group of individual trustees that is an RSE licensee; and

                     (b)  the RSE licensee is in breach of subsection (1).

Penalty:  60 penalty units.

             (3)  Subsection (2) is an offence of strict liability.

Note 1:       For strict liability, see section 6.1 of the Criminal Code.

Note 2:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility and Part IA of the Crimes Act 1914 contains provisions dealing with penalties.

29QA  Breach does not affect validity of issue of superannuation interests etc.

                   A breach of section 29Q does not affect the validity of the issue of a superannuation interest or of any other act.

29QB  Self incrimination

             (1)  An individual is not excused from complying with a requirement under section 29LA or 29PE to give information on the ground that doing so would tend to incriminate the individual or make the individual liable to a penalty.

             (2)  The information given by the individual in compliance with such a requirement is not admissible in evidence against the individual in a criminal proceeding or a proceeding for the imposition of a penalty, other than a proceeding in respect of the falsity of the information, if:

                     (a)  before giving the information, the individual claims that giving the information might tend to incriminate the individual or make the individual liable to a penalty; and

                     (b)  giving the information might in fact tend to incriminate the individual or make the individual liable to a penalty.

 

Part 3—Operating standards

  

30  Object of Part

                   The object of this Part is to provide for a system of prescribed standards applicable to:

                     (a)  the operation of regulated superannuation funds, approved deposit funds and pooled superannuation trusts; and

                     (b)  the trustees and RSE licensees of those funds and trusts.

31  Operating standards for regulated superannuation funds

             (1)  The regulations may prescribe standards applicable to the operation of regulated superannuation funds (funds) and to trustees and RSE licensees of those funds.

             (2)  The standards that may be prescribed include, but are not limited to, standards relating to the following matters:

                     (a)  the persons who may contribute to funds;

                     (b)  the vesting in beneficiaries in funds of benefits arising directly or indirectly from amounts contributed to the funds;

                     (c)  the amount of contributions that a fund may accept;

                     (d)  the circumstances in which a fund may accept contributions;

                     (e)  the form in which benefits may be provided by funds;

                      (f)  the actuarial standards that will apply to funds;

                     (g)  the preservation of benefits arising directly or indirectly from amounts contributed to funds;

                     (h)  the payment by funds of benefits arising directly or indirectly from amounts contributed to the funds;

                      (i)  the portability of benefits arising directly or indirectly from amounts contributed to funds;

                      (j)  the levels of benefits that may be provided by funds and the levels of assets that may be held by funds;

                     (k)  the application by funds of money no longer required to meet payments of benefits to beneficiaries because the beneficiaries have ceased to be entitled to receive those benefits;

                      (l)  the investment of assets of funds and the management of the investment;

                    (m)  the number of trustees, and the composition of boards or committees of trustees, of funds;

                   (ma)  the requirements relating to fitness and propriety for RSE licensees of funds and trustees of funds;

                     (n)  the keeping and retention of records in relation to funds;

                     (o)  the financial and actuarial reports to be prepared in relation to funds;

                     (p)  the disclosure of information to beneficiaries in funds;

                    (pa)  the disclosure of information by a trustee of a fund who is a member of a group of individual trustees to the other trustees in that group;

                     (q)  the disclosure of information about funds to the Regulator;

                      (r)  the disclosure of information about funds to persons other than beneficiaries or the Regulator;

                      (s)  the financial position of funds;

                    (sa)  the outsourcing arrangements relating to the operation of funds;

                    (sb)  the adequacy of resources (including human resources, technical resources, and financial resources) of, or available to, trustees of funds;

                      (t)  the funding and solvency of funds;

                     (u)  the winding‑up of funds.

32  Operating standards for approved deposit funds

             (1)  The regulations may prescribe standards applicable to the operation of approved deposit funds (funds) and to trustees and RSE licensees of those funds.

             (2)  The standards that may be prescribed include, but are not limited to, standards relating to the following matters:

                     (a)  the kinds of amounts that may be deposited with funds;

                    (aa)  the circumstances in which amounts may be deposited with funds;

                     (b)  the preservation of amounts deposited with funds, and of earnings on such amounts;

                     (c)  the payment out of funds of amounts deposited with the funds, and of earnings on such amounts;

                     (d)  the portability of amounts deposited with funds, and of earnings on such amounts;

                     (e)  the form in which benefits may be paid out of funds;

                      (f)  the investment of assets of funds and the management of the investment;

                    (fa)  the requirements relating to fitness and propriety for RSE licensees of funds and trustees of funds;

                     (g)  the keeping and retention of records in relation to funds;

                     (h)  the financial and actuarial reports to be prepared in relation to funds;

                      (i)  the disclosure of information to beneficiaries in funds;

                      (j)  the disclosure of information about funds to the Regulator;

                     (k)  the disclosure of information about funds to persons other than beneficiaries or the Regulator;

                      (l)  the financial position of funds;

                     (la)  the outsourcing arrangements relating to the operation of funds;

                     (lb)  the adequacy of resources (including human resources, technical resources, and financial resources) of, or available to, trustees of funds;

                    (m)  the funding and solvency of funds;

                     (n)  the winding‑up of funds.

33  Operating standards for pooled superannuation trusts

             (1)  The regulations may prescribe standards applicable to the operation of pooled superannuation trusts (trusts) and to trustees and RSE licensees of those trusts.

             (2)  The standards that may be prescribed include, but are not limited to, standards relating to the following matters:

                    (aa)  the circumstances in which units in trusts may be acquired;

                     (a)  the ownership and disposal of units in trusts;

                     (b)  the investment of assets of trusts and the management of the investment;

                    (ba)  the requirements relating to fitness and propriety for RSE licensees of trusts and trustees of trusts;

                     (c)  the persons who may be trustees of trusts;

                     (d)  the number of trustees, and the composition of boards or committees of trustees, of trusts;

                     (e)  the keeping and retention of records in relation to trusts;

                      (f)  the financial and actuarial reports to be prepared in relation to trusts;

                     (g)  the disclosure of information to unit‑holders in trusts;

                     (h)  the disclosure of information about trusts to the Regulator;

                      (i)  the disclosure of information about trusts to persons other than unit‑holders or the Regulator;

                      (j)  the financial position of trusts;

                     (ja)  the outsourcing arrangements relating to the operation of trusts;

                     (jb)  the adequacy of resources (including human resources, technical resources and financial resources) of, or available to, trustees of trusts;

                     (k)  the funding and solvency of trusts.

34  Prescribed operating standards must be complied with

Standards must be complied with

             (1)  Each trustee of a superannuation entity must ensure that the prescribed standards applicable to the operation of the entity are complied with at all times.

Offence

             (2)  A person who intentionally or recklessly contravenes subsection (1) is guilty of an offence punishable on conviction by a fine not exceeding 100 penalty units.

Note:          Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Validity of transaction not affected by contravention of (1)

             (3)  A contravention of subsection (1) does not affect the validity of a transaction.

 

Part 4—Trustee of superannuation entity to lodge annual returns with the Regulator

  

35  Object of Part

                   The object of this Part is to require certain reports and returns relating to superannuation entities to be given to the Regulator.

36  Trustee to give copy of audit report to APRA

Lodgment

             (1)  Each trustee of a superannuation entity must, within the prescribed period after the year of income, ensure that APRA is given a copy of the report given to a trustee of the entity by an approved auditor under Part 13 in relation to the entity, and any RSE licensee of the entity, in respect of that year of income, certified to be a true copy of the report by:

                     (a)  if the trustee is a body corporate—a responsible officer of the body corporate; or

                     (b)  if the trustee is a member of a group of individual trustees—at least one of those trustees; or

                     (c)  in any other case—the trustee.

Note:          The Financial Sector (Collection of Data) Act 2001 makes provision for annual returns and other financial documents to be given by trustees to APRA.

             (2)  A trustee is guilty of an offence if the trustee contravenes subsection (1).

Maximum penalty:    50 penalty units.

          (2A)  A trustee is guilty of an offence if the trustee contravenes subsection (1). This is an offence of strict liability.

Maximum penalty:    25 penalty units.

Note 1:    Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Note 2:    For strict liability, see section 6.1 of the Criminal Code.

Endorsement of report on return

             (4)  If the return given under the Financial Sector (Collection of Data) Act 2001 is not given on a data processing device, or by way of electronic transmission, the report referred to in subsection (1) may be endorsed on the return.

Self managed superannuation funds

             (5)  A superannuation entity is not required to lodge a return under the Financial Sector (Collection of Data) Act 2001 in respect of a year of income if the superannuation entity was, at all times during the year of income, a self managed superannuation fund.

36A  Trustee of self managed superannuation fund to lodge annual returns

Lodgment

             (1)  Each trustee of a superannuation entity that was a self managed superannuation fund at any time during a year of income must, within the reporting period, or within such longer period as the Commissioner of Taxation allows, ensure that the Commissioner of Taxation is given a return under this section.

Period for lodgment

             (2)  The reporting period is the period that begins at the end of the year of income and whose length is:

                     (a)  prescribed by the regulations for the purposes of this paragraph; or

                     (b)  if the length of the period is not prescribed—specified for the purposes of this paragraph by the Commissioner of Taxation by notice in the Gazette.

Form of return

             (3)  The return must:

                     (a)  be in the approved form; and

                     (b)  contain such information as is required by the form in relation to the fund in respect of that year of income or in relation to another year of income, or both.

Note:          The approved form of return may require a trustee to set out the tax file number of the entity. See subsection 299U(2).

             (7)  A person is guilty of an offence if the person contravenes this section.

Maximum penalty:    50 penalty units.

          (7A)  A person is guilty of an offence if the person contravenes this section. This is an offence of strict liability.

Maximum penalty:    25 penalty units.

Note 1:    Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Note 2:    For strict liability, see section 6.1 of the Criminal Code.

             (8)  A notice under paragraph (2)(b) is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.

 

Part 5—Notices about complying fund status

Division 1—Objects and interpretation

37  Objects of Part

                   The objects of this Part are:

                     (a)  to provide for a system of notices about complying fund status in relation to a year of income (see Division 2); and

                     (b)  to provide for those notices to be used to determine complying fund status for tax purposes (see Division 3).

38  Meaning of entity

                   In this Part:

entity means a fund, scheme or trust.

 

Division 2—The Regulator may give notices about complying fund status

38A  Meaning of regulatory provision

                   In this Division:

regulatory provision, in relation to a superannuation entity, means:

                     (a)  a provision of this Act or the regulations; or

                    (aa)  a provision of the Financial Sector (Collection of Data) Act 2001; or

                     (b)  any of the following provisions of the Corporations Act 2001 as applying in relation to financial products (within the meaning of Chapter 7 of that Act) that are interests in the superannuation entity:

                              (i)  subsection 1013K(1) or (2);

                             (ii)  subsection 1016A(2) or (3);

                            (iii)  subsection 1017B(1);

                            (iv)  subsection 1017C(2), (3) or (5);

                             (v)  subsection 1017D(1);

                            (vi)  subsection 1017DA(3);

                           (vii)  subsection 1017E(3) or (4);

                           (viii)  subsection 1020E(8) or (9);

                            (ix)  subsection 1021C(1) or (3);

                             (x)  subsection 1021D(1);

                            (xi)  subsection 1021E(1);

                           (xii)  subsection 1021O(1) or (3);

                           (xiii)  section 1041E;

                          (xiv)  subsection 1041F(1);

                           (xv)  subsection 1043A(1) or (2);

                          (xvi)  any other provisions that are specified in regulations made for the purposes of this subparagraph.

39  Meaning of contravention

             (1)  For the purposes of this Division, a contravention of a regulatory provision is to be ignored unless the contravention is:

                     (a)  an offence; or

                     (b)  a contravention of a civil penalty provision.

          (1A)  In relation to a regulatory provision that states that a person commits an offence if they engage, or fail to engage, in specified conduct, a person is, for the purposes of this Division, taken to contravene the provision if the person engages, or fails to engage, in that conduct.

             (2)  For the purposes of this Division, it is sufficient if a contravention is established on the balance of probabilities.

40  Notices by the Regulator to trustee

Notice about complying fund status

             (1)  The Regulator may give a written notice to a trustee of an entity stating:

                     (a)  whether the entity is or is not a complying superannuation fund; or

                     (b)  whether the entity is or is not a complying approved deposit fund; or

                     (c)  whether the entity is or is not a pooled superannuation trust;

as the case may be, in relation to a year of income specified in the notice.

Reasons

             (2)  If the Regulator gives a notice to a trustee of an entity stating that:

                     (a)  the entity is not a complying superannuation fund; or

                     (b)  the entity is not a complying approved deposit fund; or

                     (c)  the entity is not a pooled superannuation trust;

as the case may be, in relation to a year of income, the notice must set out the reasons why the Regulator so stated.

Commissioner of Taxation to be told about notice

             (3)  When the APRA gives a notice under this section, APRA must give particulars of the notice to the Commissioner of Taxation.

Note:          A statement of the tax file number of the entity may accompany the particulars of the notice. See subsection 299U(3).

Revocation

             (4)  If:

                     (a)  the Regulator gives a notice under this section (the original notice) to a trustee of an entity stating that:

                              (i)  the entity is a complying superannuation fund; or

                             (ii)  the entity is a complying approved deposit fund; or

                            (iii)  the entity is a pooled superannuation trust;

                            as the case may be, in relation to a year of income; and

                     (b)  the Regulator subsequently gives a notice under this section (the second notice) to a trustee of the entity stating that:

                              (i)  the entity is not a complying superannuation fund; or

                             (ii)  the entity is not a complying approved deposit fund; or

                            (iii)  the entity is not a pooled superannuation trust;

                            as the case may be, in relation to the year of income;

the second notice is taken to revoke the original notice.

Note:          Because “the Regulator” is whichever of APRA or the Commissioner of Taxation is administering this provision in respect of a fund, a notice could initially be given to a fund by APRA under paragraph 40(4)(a), and later the Commissioner of Taxation could give a notice to the same fund under paragraph 40(4)(b). This is because the fund could have become a self managed superannuation fund after the first notice was given.

41  When the Regulator obliged to give notice of compliance

             (1)  Except as provided by subsection (2), the Regulator is not obliged to give a notice under section 40.

             (2)  The Regulator must give a notice under section 40 to a trustee of an entity stating that the entity is a complying superannuation fund, a complying approved deposit fund or a pooled superannuation trust, as the case may be, in relation to a year of income (the current year of income) if:

                     (a)  the entity is a complying superannuation fund, a complying approved deposit fund or a pooled superannuation trust, as the case requires, in relation to the current year of income; and

                     (b)  either:

                              (i)  the Regulator has not given a notice to a trustee of the entity under section 40 stating that the entity is a complying superannuation fund, a complying approved deposit fund or a pooled superannuation trust, as the case requires, in relation to a previous year of income; or

                             (ii)  both:

                                        (A)  the Regulator has given a notice to a trustee of the entity under section 40 stating that the entity is not a complying superannuation fund, is not a complying approved deposit fund or is not a pooled superannuation trust, as the case requires, in relation to a previous year of income; and

                                        (B)  the Regulator has not given a notice to a trustee of the entity under section 40 stating that the fund is a complying superannuation fund, a complying approved deposit fund or a pooled superannuation trust, as the case requires, in relation to a year of income that is later than that previous year of income and earlier than the current year of income.

             (3)  Despite section 2, a previous year mentioned in subsection (2) may be a year of income earlier than the 1994‑95 year of income (see section 49). However, despite section 49, for the purposes of the application of subsection (2) to a complying superannuation fund, if the fund was not a regulated superannuation fund at all times during the current year of income when the fund was in existence, paragraph (2)(b) does not apply unless the previous year of income is the 1994‑95 year of income or a later year of income.

             (4)  For the purposes of this section, if a notice under section 40 is revoked, or the decision to give the notice is set aside, the notice is taken never to have been given.

42  Complying superannuation fund

             (1)  An entity is a complying superannuation fund in relation to a year of income for the purposes of this Division if:

                     (a)  either:

                              (i)  the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence; or

                             (ii)  the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence other than a time, before it became a resident regulated superannuation fund, when the entity was a resident approved deposit fund; and

                     (b)  either of the following conditions is satisfied:

                              (i)  no trustee of the entity contravened any of the regulatory provisions in relation to the entity in respect of the year of income;

                             (ii)  both:

                                        (A)  a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of the year of income on one or more occasions; and

                                        (B)  the entity did not fail the culpability test set out in subsection (1A) in relation to any of those contraventions; and

                     (c)  the entity was not a self managed superannuation fund at any time during the year of income.

       (1AA)  An entity is also a complying superannuation fund in relation to the 1994‑95 year of income or a later year of income if:

                     (a)  the entity:

                              (i)  is a superannuation fund that came into existence during the year of income; or

                             (ii)  was a resident approved deposit fund that became a superannuation fund during the year of income; and

                     (b)  the entity complied with subsections 19(2) to (4):

                              (i)  within 60 days after the day on which it came into existence or became a superannuation fund, as the case may be; or

                             (ii)  within such further period, if any, as APRA (whether before or after the end of the period of 60 days) allows; and

                     (c)  either of the following conditions is satisfied:

                              (i)  no trustee of the entity contravened any of the regulatory provisions in relation to the entity in respect of the whole of the period (the pre‑lodgment period) that began when the entity came into existence or became a superannuation fund, as the case may be, and ended when the entity complied with subsections 19(2) to (4);

                             (ii)  a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of the pre‑lodgment period on one or more occasions but APRA is satisfied that, because of special circumstances that existed in relation to the fund during the pre‑lodgment period, it would be reasonable for the fund to be treated as if it had satisfied the regulatory provisions; and

                     (d)  the entity was a resident regulated superannuation fund at all times during the part of the year of income occurring after the end of the pre‑lodgment period; and

                    (da)  the entity was not a self managed superannuation fund at any time during the year of income; and

                     (e)  either of the conditions stated in paragraph (1)(b) is satisfied in relation to the entity in respect of the part of the year of income occurring after the end of the pre‑lodgment period.

        (1AB)  In determining for the purpose of paragraph (1AA)(c) whether any of the regulatory provisions were contravened in respect of the entity in respect of the pre‑lodgment period, the regulatory provisions are taken to have applied in relation to the entity in respect of that period as if the entity were a resident regulated superannuation fund during that period.

        (1AC)  An entity is also a complying superannuation fund in relation to the 1994‑95 year of income or a later year of income if:

                     (a)  the trustee, or the trustees, of the entity have purported to make an election under subsection 19(4); and

                     (b)  the requirements of subsections 19(2) to (4) (to the extent that they have not already been complied with) are complied with within 28 days after a trustee of the entity finds out (whether by written notice from APRA or otherwise) that they were not complied with, or within such further period, if any, as APRA (whether before or after the end of the period of 28 days) allows; and

                     (c)  except where a trustee of the entity received written notice from APRA about the non‑compliance—a trustee of the entity tells APRA in writing of the compliance within 7 days after the requirements are complied with or within such further period, if any, as APRA (whether before or after the end of the period of 7 days) allows; and

                     (d)  either of the following conditions is satisfied:

                              (i)  no trustee of the entity contravened any of the regulatory provisions in relation to the entity in respect of the whole of the period (the rectification period) that began when the trustee, or the trustees, of the entity lodged the purported election under subsection 19(4) and ended when the entity complied with subsections 19(2) to (4);

                             (ii)  a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of the rectification period on one or more occasions but APRA is satisfied that, because of special circumstances that existed in relation to the fund during the rectification period, it would be reasonable for the fund to be treated as if it had satisfied the regulatory provisions; and

                     (e)  if the fund was in existence before the beginning of its 1994‑95 year of income—under regulations made for the purposes of section 50, the fund is treated as if it had satisfied the transitional superannuation fund conditions at all times during the period that began at the beginning of the fund’s 1994‑95 year of income and ended when the trustee, or the trustees, of the entity lodged the purported election under subsection 19(4); and

                      (f)  the entity was a resident regulated superannuation fund at all times during the part of the year of income occurring after the end of the rectification period; and

                    (fa)  the entity was not a self managed superannuation fund at any time during the year of income; and

                     (g)  either of the conditions stated in paragraph (1)(b) is satisfied in relation to the entity in respect of the part of the year of income occurring after the end of the rectification period.

       (1AD)  In determining for the purpose of paragraph (1AC)(d) whether any of the regulatory provisions were contravened in respect of the entity in respect of the rectification period, the regulatory provisions are taken to have applied in relation to the entity in respect of that period as if the entity were a resident regulated superannuation fund during that period.

Note:          Subsection 50(2) provides that certain superannuation funds that have been wound up or terminated are taken to have been complying superannuation funds before the winding up or termination.

          (1A)  For the purposes of subparagraph (1)(b)(ii), an entity fails the culpability test in relation to a particular contravention of a regulatory provision if:

                     (a)  both:

                              (i)  all of the members of the entity were in any way directly or indirectly knowingly concerned in, or party to, the contravention; and

                             (ii)  the Regulator, after considering:

                                        (A)  the taxation consequences that would arise if the entity were to be treated as a non‑complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act 1936 in relation to the year of income concerned; and

                                        (B)  the seriousness of the contravention; and

                                        (C)  all other relevant circumstances;

                                   thinks that a notice should be given stating that the entity is not a complying superannuation fund in relation to the year of income concerned; or

                     (b)  all of the following conditions are satisfied:

                              (i)  one or more members of the entity were in any way directly or indirectly knowingly concerned in, or party to, the contravention;

                             (ii)  one or more members of the entity (the innocent members) were not in any way directly or indirectly knowingly concerned in, or party to, the contravention;

                            (iii)  none of the innocent members would suffer any substantial financial detriment if the entity were to be treated as a non‑complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act 1936 in relation to the year of income concerned;

                            (iv)  the Regulator, after considering:

                                        (A)  the taxation consequences that would arise if the entity were to be treated as a non‑complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act 1936 in relation to the year of income concerned; and

                                        (B)  the seriousness of the contravention; and

                                        (C)  all other relevant circumstances;

                                   thinks that a notice should be given stating that the entity is not a complying superannuation fund in relation to the year of income concerned.

Note:          The culpability test is still relevant to a fund that has been a self managed fund during only part of a year of income—see subparagraph 42A(2)(b)(ii), paragraph 42A(3)(g) and subparagraph 42A(4)(f)(ii).

          (1B)  For the purposes of subsection (1A), if there is a question whether a person was in any way directly or indirectly knowingly concerned in, or party to, a particular contravention, that question may be decided on the balance of probabilities.

             (2)  In this section, a reference to a member of an entity means, if the entity is an approved deposit fund, a beneficiary of the fund.

             (3)  If a person or body is specified in the regulations for the purposes of subsection 19(4), a reference to APRA in subparagraph (1AA)(b)(ii) or (c)(ii) or subsection (1AC) of this section is taken to be a reference to that person or body.

42A  Complying superannuation fund—fund that has been a self managed superannuation fund at any time during a year

Entity that was a self managed superannuation fund throughout a year of income

             (1)  An entity that was a self managed superannuation fund at all times during a year of income is a complying superannuation fund in relation to that year of income for the purposes of this Division if:

                     (a)  either:

                              (i)  the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence; or

                             (ii)  the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence other than a time, before it became a resident regulated superannuation fund, when the entity was a resident approved deposit fund; and

                     (b)  the entity passes the test in subsection (5) in relation to the year of income.

Entity that was a self managed superannuation fund during only part of a year of income

             (2)  An entity that was a self managed superannuation fund during a part or parts of a year of income is a complying superannuation fund in relation to that year of income for the purposes of this Division if:

                     (a)  either:

                              (i)  the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence; or

                             (ii)  the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence other than a time, before it became a resident regulated superannuation fund, when the entity was a resident approved deposit fund; and

                     (b)  both:

                              (i)  the entity passes the test in subsection (5) in respect of the part or parts of the year of income during which the entity was a self managed superannuation fund; and

                             (ii)  if a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of any other part or parts of the year of income—the entity did not fail the culpability test set out in subsection 42(1A) in relation to any of those contraventions.

Funds coming into existence during year of income etc.

             (3)  An entity that:

                     (a)  is a superannuation fund that came into existence during the year of income and at that time or later in the year of income became a self managed superannuation fund; or

                     (b)  was a resident approved deposit fund that became a superannuation fund during the year of income;

is also a complying superannuation fund in relation to the year of income if:

                     (c)  the entity complied with subsections 19(2) to (4):

                              (i)  within 60 days after the day on which it came into existence or became a superannuation fund, as the case may be; or

                             (ii)  within such further period, if any, as APRA (whether before or after the end of the period of 60 days) allows; and

                     (d)  either of the following conditions is satisfied:

                              (i)  no trustee of the entity contravened any of the regulatory provisions in relation to the entity during the whole of the period (the pre‑lodgment period) that began when the entity came into existence or became a superannuation fund, as the case may be, and ended when the entity complied with subsections 19(2) to (4);

                             (ii)  a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity during the pre‑lodgment period on one or more occasions but APRA is satisfied that, because of special circumstances that existed in relation to the fund during the pre‑lodgment period, it would be reasonable for the fund to be treated as if it had satisfied the regulatory provisions; and

                     (e)  the entity was a resident regulated superannuation fund at all times during the part of the year of income occurring after the pre‑lodgment period; and

after the pre‑lodgment period:

                      (f)  the entity passed the test in subsection (5) in respect of the part or parts of the year of income, occurring after the pre‑lodgment period, during which the entity was a self managed superannuation fund; and

                     (g)  if a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of any part or parts of the year of income, occurring after the pre‑lodgment period, during which the entity was not a self managed superannuation fund—the entity did not fail the culpability test set out in subsection 42(1A) in relation to any of those contraventions.

Trustee makes an election

             (4)  An entity that was a self managed superannuation fund at some time, or at all times, during a year of income is also a complying superannuation fund in relation to the year of income if:

                     (a)  the trustee, or the trustees, of the entity have purported to make an election under subsection 19(4); and

                     (b)  if, when the election was made, the requirements of subsections 19(2) to (4) are not complied with:

                              (i)  the requirements of subsections 19(2) to (4) (to the extent that they have not already been complied with) are complied with within 28 days after a trustee of the entity finds out (whether by written notice from APRA or otherwise) that they were not complied with, or within such further period, if any, as APRA (whether before or after the end of the period of 28 days) allows; and

                             (ii)  except where a trustee of the entity received written notice from APRA about the non‑compliance—a trustee of the entity tells APRA in writing of the compliance within 7 days after the requirements are complied with or within such further period, if any, as APRA (whether before or after the end of the period of 7 days) allows; and

                     (c)  either of the following conditions is satisfied:

                              (i)  no trustee of the entity contravened any of the regulatory provisions in relation to the entity during the whole of the period (the rectification period) that began when the trustee, or the trustees, of the entity lodged the purported election under subsection 19(4) and ended when the entity complied with subsections 19(2) to (4);

                             (ii)  a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity during the rectification period on one or more occasions but APRA is satisfied that, because of special circumstances that existed in relation to the fund during the rectification period, it would be reasonable for the fund to be treated as if it had satisfied the regulatory provisions; and

                     (d)  if the fund was in existence before the beginning of its 1994‑95 year of income—under regulations made for the purposes of section 50, the fund is treated as if it had satisfied the transitional superannuation fund conditions at all times during the period that began at the beginning of the fund’s 1994‑95 year of income and ended when the trustee, or the trustees, of the entity lodged the purported election under subsection 19(4); and

                     (e)  the entity was a resident regulated superannuation fund at all times during the part of the year of income occurring after the end of the rectification period; and

                      (f)  in respect of the part of the year of income occurring after the end of the rectification period, both:

                              (i)  the entity passed the test in subsection (5) in respect of the part or parts of the year of income occurring after the end of the rectification period, during which the entity was a self managed superannuation fund; and

                             (ii)  if a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of any other part or parts of the year of income occurring after the end of the rectification period, during which the entity was not a self managed superannuation fund—the entity did not fail the culpability test set out in subsection 42(1A) in relation to any of those contraventions.

Circumstances in which entity passes the test in this subsection

             (5)  An entity passes the test in this subsection in relation to a year of income or part of a year of income if:

                     (a)  no trustee of the entity contravened any of the regulatory provisions in relation to the entity during the year of income or the part of the year of income; or

                     (b)  if a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity during the year of income or the part of the year of income, the Regulator, after considering:

                              (i)  the taxation consequences that would arise if the entity were to be treated as a non‑complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act 1936 in relation to the year of income concerned; and

                             (ii)  the seriousness of the contravention or contraventions; and

                            (iii)  all other relevant circumstances;

                            thinks that a notice should nevertheless be given stating that the entity is a complying superannuation fund in relation to the year of income concerned.

Determining whether contravention

             (6)  In determining for the purposes of this section whether any of the regulatory provisions were contravened in respect of the entity in respect of the pre‑lodgment period or the rectification period, the regulatory provisions are taken to have applied in relation to the entity in respect of that period as if the entity were a resident regulated superannuation fund during that period.

References to APRA

             (7)  If a person or body is specified in the regulations for the purposes of subsection 19(4), a reference to APRA in subparagraph (3)(c)(ii), (3)(d)(ii), or subsection (4) is taken to be a reference to that person or body.

43  Complying approved deposit fund

                   An entity is a complying approved deposit fund in relation to a year of income for the purposes of this Division if:

                     (a)  at all times during the year of income when the entity was in existence, the entity was a resident approved deposit fund; and

                     (b)  any of the following conditions is satisfied:

                              (i)  the trustee did not contravene any of the regulatory provisions in relation to the entity in respect of the year of income;

                             (ii)  both:

                                        (A)  the trustee contravened one or more of the regulatory provisions in relation to the entity in respect of the year of income on one or more occasions; and

                                        (B)  each contravention was rectified within a period of 30 days after the trustee became aware of the contravention or within such further period as APRA allows;

                            (iii)  both:

                                        (A)  the trustee contravened one or more of the regulatory provisions in relation to the entity in respect of the year of income on one or more occasions; and

                                        (B)  APRA is satisfied that the seriousness or frequency, or both, of the contraventions does not warrant the giving of a notice stating that the entity is not a complying approved deposit fund in relation to the year of income;

                            (iv)  APRA, after considering all relevant circumstances, thinks that a notice should be given stating that the entity is a complying approved deposit fund in relation to the year of income.

44  Pooled superannuation trust

                   An entity is a pooled superannuation trust in relation to a year of income for the purposes of this Division if:

                     (a)  at all times during the year of income when the entity was in existence, the entity was a pooled superannuation trust; and

                     (b)  any of the following conditions is satisfied:

                              (i)  the trustee did not contravene any of the regulatory provisions in relation to the entity in respect of the year of income;

                             (ii)  both:

                                        (A)  the trustee contravened one or more of the regulatory provisions in relation to the entity in respect of the year of income on one or more occasions; and

                                        (B)  each contravention was rectified within a period of 30 days after the trustee became aware of the contravention or such further period as APRA allows;

                            (iii)  both:

                                        (A)  the trustee contravened one or more of the regulatory provisions in relation to the entity in respect of the year of income on one or more occasions; and

                                        (B)  APRA is satisfied that the seriousness or frequency, or both, of the contraventions does not warrant the giving of a notice stating that the entity is not a pooled superannuation trust in relation to the year of income;

                            (iv)  APRA, after considering all relevant circumstances, thinks that a notice should be given stating that the entity is a pooled superannuation trust in relation to the year of income.

 

Division 3—Complying fund status for tax purposes

45  Complying superannuation fund

             (1)  A fund is a complying superannuation fund for the purposes of Part IX of the Income Tax Assessment Act in relation to a year of income (the current year of income) if, and only if:

                     (a)  the Regulator has given a notice to a trustee of the fund under section 40 stating that the fund is a complying superannuation fund in relation to the current year of income; or

                     (b)  the Regulator has given a notice to a trustee of the fund under section 40 stating that the fund is a complying superannuation fund in relation to a previous year of income and has not given a notice to a trustee of the fund under that section stating that the fund was not a complying superannuation fund in relation to:

                              (i)  the current year of income; or

                             (ii)  a year of income that is:

                                        (A)  later than that previous year of income; and

                                        (B)  earlier than the current year of income.

             (2)  Despite section 2, the previous year mentioned in paragraph (1)(b) may be a year of income earlier than the 1994‑95 year of income (see section 49). However, despite section 49, if the fund was not a regulated superannuation fund at all times during the current year of income when the fund was in existence, paragraph (1)(b) does not apply unless the previous year of income is the 1994‑95 year of income or a later year of income.

             (3)  For the purposes of this section, if a notice under section 40 is revoked, or the decision to give the notice is set aside, the notice is taken never to have been given.

             (4)  Section 170 of the Income Tax Assessment Act does not prevent the amendment of an assessment at any time for the purposes of giving effect to subsection (3).

             (5)  For the purposes of this section, if a notice under section 40 is given in relation to a fund in relation to a year of income, the notice is taken to have been given at the beginning of the year of income.

             (6)  Despite subsection (1), if, at all times during a year of income when a fund was in existence, the fund was, or was part of, an exempt public sector superannuation scheme, the fund is a complying superannuation fund in relation to the year of income for the purposes of Part IX of the Income Tax Assessment Act.

46  Complying superannuation scheme—superannuation guarantee charge

                   An exempt public sector superannuation scheme is taken to be a complying superannuation scheme for the purposes of the Superannuation Guarantee (Administration) Act 1992.

47  Complying approved deposit fund

             (1)  A fund is a complying approved deposit fund for the purposes of Part IX of the Income Tax Assessment Act in relation to a year of income (the current year of income) if, and only if:

                     (a)  APRA has given a notice to the trustee under section 40 stating that the fund is a complying approved deposit fund in relation to the current year of income; or

                     (b)  APRA has given a notice to the trustee under section 40 stating that the fund is a complying approved deposit fund in relation to a previous year of income and has not given a notice to the trustee under that section stating that the fund was not a complying approved deposit fund in relation to:

                              (i)  the current year of income; or

                             (ii)  a year of income that is:

                                        (A)  later than that previous year of income; and

                                        (B)  earlier than the current year of income.

             (2)  Despite section 2, the previous year mentioned in paragraph (1)(b) may be a year of income earlier than the 1994‑95 year of income (see section 49).

             (3)  For the purposes of this section, if a notice under section 40 is revoked, or the decision to give the notice is set aside, the notice is taken never to have been given.

             (4)  Section 170 of the Income Tax Assessment Act does not prevent the amendment of an assessment at any time for the purposes of giving effect to subsection (3).

             (5)  For the purposes of this section, if a notice under section 40 is given in relation to a fund in relation to a year of income, the notice is taken to have been given at the beginning of the year of income.

48  Pooled superannuation trust

             (1)  A unit trust is a pooled superannuation trust for the purposes of Part IX of the Income Tax Assessment Act in relation to a year of income (the current year of income) if, and only if:

                     (a)  APRA has given a notice to the trustee under section 40 stating that the trust is a pooled superannuation trust in relation to the current year of income; or

                     (b)  APRA has given a notice to the trustee under section 40 stating that the trust is a pooled superannuation trust in relation to a previous year of income and has not given a notice to the trustee under that section stating that the trust was not a pooled superannuation trust in relation to:

                              (i)  the current year of income; or

                             (ii)  a year of income that is:

                                        (A)  later than that previous year of income; and

                                        (B)  earlier than the current year of income.

             (2)  Despite section 2, the previous year mentioned in paragraph (1)(b) may be a year of income earlier than the 1994‑95 year of income (see section 49).

             (3)  For the purposes of this section, if a notice under section 40 is revoked, or the decision to give the notice is set aside, the notice is taken never to have been given.

             (4)  Section 170 of the Income Tax Assessment Act does not prevent the amendment of an assessment at any time for the purposes of giving effect to subsection (3).

             (5)  For the purposes of this section, if a notice under section 40 is given in relation to a trust in relation to a year of income, the notice is taken to have been given at the beginning of the year of income.

49  Transitional—notices under the repealed provisions of the Occupational Superannuation Standards Act 1987

Superannuation funds—positive

             (1)  For the purposes of paragraph 41(2)(b) and this Division, if:

                     (a)  a notice under repealed section 12 or 13 of the Occupational Superannuation Standards Act 1987 stated that the Commissioner is satisfied that:

                              (i)  a fund satisfied the superannuation fund conditions in relation to a year of income; or

                             (ii)  a fund should be treated as if it had satisfied the superannuation fund conditions in relation to a year of income; and

                     (b)  the year of income is the 1993‑94 year of income or an earlier year of income;

the notice has effect as if it were a notice under section 40 stating that the fund is a complying superannuation fund in relation to the year of income.

ADFs—positive

             (2)  For the purposes of paragraph 41(2)(b) and this Division, if:

                     (a)  a notice under repealed section 14 or 15 of the Occupational Superannuation Standards Act 1987 stated that the Commissioner is satisfied that:

                              (i)  a fund satisfied the approved deposit fund conditions in relation to a year of income; or

                             (ii)  a fund should be treated as if it had satisfied the approved deposit fund conditions in relation to a year of income; and

                     (b)  the year of income is the 1993‑94 year of income or an earlier year of income;

the notice has effect as if it were a notice under section 40 stating that the fund is a complying approved deposit fund in relation to the year of income.

PSTs—positive

             (3)  For the purposes of paragraph 41(2)(b) and this Division, if:

                     (a)  a notice under repealed section 15B or 15C of the Occupational Superannuation Standards Act 1987 stated that the Commissioner is satisfied that:

                              (i)  a trust satisfied the pooled superannuation trust conditions in relation to a year of income; or

                             (ii)  a trust should be treated as if it had satisfied the pooled superannuation trust conditions in relation to a year of income; and

                     (b)  the year of income is the 1993‑94 year of income or an earlier year of income;

the notice has effect as if it were a notice under section 40 stating that the trust is a pooled superannuation trust in relation to the year of income.

Superannuation funds—negative

             (4)  For the purposes of paragraph 41(2)(b) and this Division, if:

                     (a)  a notice under the repealed section 12 or 13 of the Occupational Superannuation Standards Act 1987 stated that the Commissioner is not satisfied that a fund satisfied the superannuation fund conditions in relation to a year of income; and

                     (b)  the year of income is the 1993‑94 year of income or an earlier year of income;

the notice has effect as if it were a notice under section 40 stating that the fund is not a complying superannuation fund in relation to the year of income.

ADFs—negative

             (5)  For the purposes of paragraph 41(2)(b) and this Division, if:

                     (a)  a notice under the repealed section 14 or 15 of the Occupational Superannuation Standards Act 1987 stated that the Commissioner is not satisfied that a fund satisfied the approved deposit fund conditions in relation to a year of income; and

                     (b)  the year of income is the 1993‑94 year of income or an earlier year of income;

the notice has effect as if it were a notice under section 40 stating that the fund is not a complying approved deposit fund in relation to the year of income.

PSTs—negative

             (6)  For the purposes of paragraph 41(2)(b) and this Division, if:

                     (a)  a notice under the repealed section 15B or 15C of the Occupational Superannuation Standards Act 1987 stated that the Commissioner is not satisfied that a trust satisfied the pooled superannuation trust conditions in relation to a year of income; and

                     (b)  the year of income is the 1993‑94 year of income or an earlier year of income;

the notice has effect as if it were a notice under section 40 stating that the trust is not a pooled superannuation trust in relation to the year of income.

OSSA—continued operation

             (7)  A reference in this section to a provision of the Occupational Superannuation Standards Act 1987 includes a reference to that provision as it continues to apply, despite its repeal, because of the Occupational Superannuation Standards Amendment Act 1993.

50  Transitional—late lodgment of elections by trustees of superannuation funds

28 days late

             (1)  For the purposes of subsection 41(3), paragraph 42(1)(a) and subsection 45(2), if:

                     (a)  on a particular day (the lodgment day), the trustee, or the trustees, of a superannuation fund have lodged or lodge an election under section 19; and

                     (b)  the lodgment day was or is after 28 July 1994; and

                     (c)  the Regulator is satisfied that this subsection should apply in relation to the fund; and

                     (d)  the trustee, or the trustees, of the fund have complied with such requirements relating to notifying members of the fund about:

                              (i)  the delay in lodging the election; and

                             (ii)  the reasons for the delay;

                            as are set out in regulations made for the purposes of this paragraph; and

                     (e)  under the regulations, the fund is treated as if it had satisfied the transitional superannuation fund conditions at all times during the period (the pre‑lodgment period):

                              (i)  beginning at the beginning of the fund’s 1994‑95 year of income; and

                             (ii)  ending at the end of the lodgment day;

the fund is taken to be a regulated superannuation fund at all times during the pre‑lodgment period.

             (2)  For the purposes of this Part, if:

                     (a)  a superannuation fund is wound up or terminated; and

                     (b)  the winding up or termination is completed on a particular day (the termination day); and

                     (c)  the termination day is before a day named by the Regulator in a written notice given to a trustee of the fund for the purposes of this paragraph; and

                     (d)  the trustee, or the trustees, of the fund told the Regulator in writing before the commencement of this subsection that they:

                              (i)  did not intend to lodge an election under section 19 in respect of the fund; and

                             (ii)  intended to take advantage of the subsection (4A) that, immediately before 1 July 1996, was taken to be inserted in this section by a declaration made under subsection 333(1); and

                     (e)  the trustee, or the trustees, have complied with such requirements relating to notifying members and prospective members of the fund that:

                              (i)  the fund would be wound up or terminated; and

                             (ii)  the trustee, or trustees, of the fund intended to take advantage of the subsection (4A) mentioned in subparagraph (d)(ii);

                            as were set out in regulations made for the purposes of that subsection (4A); and

                      (f)  as soon as practicable after the termination day, a trustee of the fund tells the Regulator in writing that the winding up or termination of the fund had been completed; and

                     (g)  under the regulations, the fund is treated as if it had satisfied the transitional superannuation fund conditions at all times during the period (the pre‑termination period):

                              (i)  beginning at the beginning of the fund’s 1994‑95 year of income; and

                             (ii)  ending at the end of the termination day;

the fund is taken to have been a complying superannuation fund at all times during the pre‑termination period.

Regulations may apply OSS system

             (5)  Regulations made for the purposes of paragraph (1)(e) or (2)(g) may:

                     (a)  confer functions or powers on the Regulator; and

                     (b)  make provision for or in relation to a matter by applying, adopting or incorporating, with such modifications as are prescribed, the provisions, or the repealed provisions, of:

                              (i)  the Occupational Superannuation Standards Act 1987; or

                             (ii)  regulations made for the purposes of section 7 of that Act;

                            (including those provisions as they continue to apply, despite their repeal, because of the Occupational Superannuation Standards Amendment Act 1993).

Section 49A of the Acts Interpretation Act 1901

             (6)  Subsection (5) of this section does not limit the application of section 49A of the Acts Interpretation Act 1901 to regulations made for the purposes of this section.

 

Part 6—Provisions relating to governing rules of superannuation entities

  

51  Object of Part

                   The object of this Part is to set out rules about the content of the governing rules of superannuation entities.

52  Covenants to be included in governing rules

Governing rules taken to contain covenants

             (1)  If the governing rules of a superannuation entity do not contain covenants to the effect of the covenants set out in subsection (2), those governing rules are taken to contain covenants to that effect.

The covenants

             (2)  The covenants referred to in subsection (1) are the following covenants by each trustee of the entity:

                     (a)  to act honestly in all matters concerning the entity;

                     (b)  to exercise, in relation to all matters affecting the entity, the same degree of care, skill and diligence as an ordinary prudent person would exercise in dealing with property of another for whom the person felt morally bound to provide;

                     (c)  to ensure that the trustee’s duties and powers are performed and exercised in the best interests of the beneficiaries;

                     (d)  to keep the money and other assets of the entity separate from any money and assets, respectively:

                              (i)  that are held by the trustee personally; or

                             (ii)  that are money or assets, as the case may be, of a standard employer‑sponsor, or an associate of a standard employer‑sponsor, of the entity;

                     (e)  not to enter into any contract, or do anything else, that would prevent the trustee from, or hinder the trustee in, properly performing or exercising the trustee’s functions and powers;

                      (f)  to formulate and give effect to an investment strategy that has regard to the whole of the circumstances of the entity including, but not limited to, the following:

                              (i)  the risk involved in making, holding and realising, and the likely return from, the entity’s investments having regard to its objectives and its expected cash flow requirements;

                             (ii)  the composition of the entity’s investments as a whole including the extent to which the investments are diverse or involve the entity in being exposed to risks from inadequate diversification;

                            (iii)  the liquidity of the entity’s investments having regard to its expected cash flow requirements;

                            (iv)  the ability of the entity to discharge its existing and prospective liabilities;

                     (g)  if there are any reserves of the entity—to formulate and to give effect to a strategy for their prudential management, consistent with the entity’s investment strategy and its capacity to discharge its liabilities (whether actual or contingent) as and when they fall due;

                     (h)  to allow a beneficiary access to any prescribed information or any prescribed documents.

Covenant referred to in paragraph (2)(e)

             (3)  A covenant referred to in paragraph (2)(e) does not prevent the trustee from engaging or authorising persons to do acts or things on behalf of the trustee.

Covenant referred to in paragraph (2)(f)

             (4)  An investment strategy is taken to be in accordance with paragraph (2)(f) even if it provides for a specified beneficiary or a specified class of beneficiaries to give directions to the trustee, where:

                     (a)  the directions relate to the strategy to be followed by the trustee in relation to the investment of a particular asset or assets of the entity; and

                     (b)  the directions are given in circumstances covered by regulations made for the purposes of this paragraph.

Regulations may prescribe other covenants

             (5)  The regulations may prescribe a covenant to be included in the governing rules of a superannuation entity and, if the governing rules of such a superannuation entity do not contain a covenant to the effect of the prescribed covenant, those rules are taken to contain a covenant to that effect.

Prescribed covenants may overlap with other requirements

             (6)  Without limiting the generality of subsection (5), the regulations may prescribe, for the purposes of that subsection, a covenant that elaborates, supplements, or otherwise deals with, any aspect of:

                     (a)  a matter to which a covenant in subsection (2) relates; or

                     (b)  a matter to which a provision of this Act (other than this section) relates.

But prescribed covenants must be capable of operating concurrently with other requirements

             (7)  However, a covenant prescribed for the purposes of subsection (5) must be capable of operating concurrently with:

                     (a)  all the covenants referred to in subsection (2); and

                     (b)  this Act other than this section.

Covenant by corporate trustee has effect as covenant by trustee’s directors

             (8)  A covenant by a corporate trustee of a superannuation entity that is to the effect of a covenant referred to in subsection (2), or to the effect of a covenant prescribed by regulations referred to in subsection (5), also operates as a covenant by each of the directors of the trustee to exercise a reasonable degree of care and diligence for the purposes of ensuring that the trustee carries out the first‑mentioned covenant, and so operates as if the directors were parties to the governing rules.

Reasonable degree of care and diligence

             (9)  The reference in subsection (8) to a reasonable degree of care and diligence is a reference to the degree of care and diligence that a reasonable person in the position of director of the trustee would exercise in the trustee’s circumstances.

53  Covenants to repay amounts to beneficiaries in approved deposit funds

Governing rules to contain 2 covenants

             (1)  If the governing rules of an approved deposit fund (other than an excluded approved deposit fund) do not contain covenants to the effect of those set out in subsection (2), they are taken to contain covenants to that effect.

Content of the covenants

             (2)  The covenants are:

                     (a)  that, if:

                              (i)  a beneficiary, by written notice given to the trustee, requests the trustee to pay to the beneficiary an amount equal to the beneficiary’s interest in the fund; and

                             (ii)  compliance by the trustee with the request would not be inconsistent with the standards applicable to the fund under section 32;

                            the trustee will pay that amount within a period (not being more than 12 months) determined by the trustee; and

                     (b)  that each director of the trustee will ensure that the trustee gives effect to the covenant in paragraph (a).

Legal personal representatives of beneficiaries

          (2A)  A reference in subsection (2) to a beneficiary includes a reference to the legal personal representative of a beneficiary.

Note:          Section 15 sets out additional rules relating to the interpretation of subsection (2).

Directors taken to be parties to governing rules

             (3)  The covenant in paragraph (2)(b) has effect as if each director were a party to the governing rules.

Period for payments to beneficiaries

             (4)  The trustee is to determine the period within which amounts are to be paid to beneficiaries under the covenant referred to in paragraph (2)(a).

Variation of payment period

             (5)  When the trustee has determined the period under subsection (4), the trustee may make a further determination varying that period if, and only if:

                     (a)  ASIC has consented in writing to the variation; or

                     (b)  the requirements of section 54 have been complied with.

54  Prerequisites to variation of repayment period

             (1)  The requirements referred to in paragraph 53(5)(b) are as follows:

                     (a)  the question whether the variation should be made has been voted on at a meeting of the beneficiaries;

                     (b)  the trustee convened the meeting by sending by post, to the last‑known address of each of the beneficiaries, at least 21 days before the meeting, a notice that set out:

                              (i)  the date, time and place of the meeting; and

                             (ii)  the reason for convening the meeting;

                     (c)  the beneficiaries who, at the meeting, vote (whether in person or by proxy) on the question hold interests equal in value to at least the prescribed percentage of the total value of all the interests in the fund;

                     (d)  the prescribed percentage of the beneficiaries who voted on the question cast their votes in favour of making the variation.

             (2)  For the purposes of paragraph (1)(c), the value of an interest is the price at which the trustee would have to make a payment in respect of the interest if the trustee were required to do so, under the covenant referred to in section 53, on the day immediately before the day when the meeting is held.

55  Consequences of contravention of covenant

             (1)  A person must not contravene a covenant contained, or taken to be contained, in the governing rules of a superannuation entity.

             (2)  A contravention of subsection (1) is not an offence and a contravention of that subsection does not result in the invalidity of a transaction.

             (3)  A person who suffers loss or damage as a result of conduct of another person that was engaged in in contravention of subsection (1) may recover the amount of the loss or damage by action against that other person or against any person involved in the contravention.

             (4)  An action under subsection (3) may be begun at any time within 6 years after the day on which the cause of action arose.

             (5)  It is a defence to an action for loss or damage suffered by a person as a result of the making of an investment by or on behalf of a trustee of a superannuation entity if the defendant establishes that the investment was made in accordance with an investment strategy formulated under a covenant referred to in paragraph 52(2)(f).

             (6)  It is a defence to an action for loss or damage suffered by a person as a result of the management of any reserves by a trustee of a superannuation entity if the defendant establishes that the management of the reserves was in accordance with a covenant referred to in paragraph 52(2)(g).

             (7)  Subsections (5) and (6) apply to an action for loss or damage, whether brought under subsection (3) or otherwise.

56  Indemnification of trustee from assets of entity

             (1)  A provision in the governing rules of a superannuation entity is void if:

                     (a)  it purports to preclude a trustee of the entity from being indemnified out of the assets of the entity in respect of any liability incurred while acting as trustee of the entity; or

                     (b)  subject to subsection (2), it limits the amount of such an indemnity.

             (2)  A provision in the governing rules of a superannuation entity is void in so far as it would have the effect of exempting a trustee of the entity from, or indemnifying a trustee of the entity against:

                     (a)  liability for breach of trust if the trustee:

                              (i)  fails to act honestly in a matter concerning the entity; or

                             (ii)  intentionally or recklessly fails to exercise, in relation to a matter affecting the entity, the degree of care and diligence that the trustee was required to exercise; or

                     (b)  liability for a monetary penalty under a civil penalty order.

             (3)  Nothing in the governing rules of a superannuation entity prohibits a trustee of the entity from seeking advice from any person in respect of any matter relating to performance of the duties or the exercise of the powers of a trustee. A provision in the governing rules that purports to preclude a trustee of the entity from being indemnified out of assets of the entity in respect of the cost of obtaining such advice, or to limit the amount of such an indemnity, is void.

57  Indemnification of directors of trustee from assets of entity

             (1)  Subject to subsection (2), the governing rules of a superannuation entity may provide for a director of the trustee to be indemnified out of the assets of the entity in respect of a liability incurred while acting as a director of the trustee.

             (2)  A provision of the governing rules of a superannuation entity is void in so far as it would have the effect of indemnifying a director of the trustee against:

                     (a)  a liability that arises because the director:

                              (i)  fails to act honestly in a matter concerning the entity; or

                             (ii)  intentionally or recklessly fails to exercise, in relation to a matter affecting the entity, the degree of care and diligence that the director is required to exercise; or

                     (b)  liability for a monetary penalty under a civil penalty order.

             (3)  A director of the trustee of a superannuation entity may be indemnified out of the assets of the entity in accordance with provisions of the entity’s governing rules that comply with this section.

             (4)  This section has effect despite section 241 of the Corporations Act 2001.

58  Trustee not to be subject to direction

             (1)  Subject to subsection (2), the governing rules of a superannuation entity other than a superannuation fund with fewer than 5 members or an excluded approved deposit fund must not permit a trustee to be subject, in the exercise of any of the trustee’s powers under those rules, to direction by any other person.

             (2)  Subsection (1) does not apply to:

                     (a)  a direction given by a court; or

                     (b)  a direction given by the Regulator; or

                     (c)  a direction given by a beneficiary or a group of beneficiaries that relates to benefits payable to that beneficiary or those beneficiaries, as the case may be; or

                     (d)  a direction given by a beneficiary or group of beneficiaries, where the direction is covered by subsection 52(4); or

                     (e)  if the entity is an employer‑sponsored fund—a direction given by an employer‑sponsor, or an associate of an employer‑sponsor, in circumstances prescribed by the regulations; or

                      (f)  a direction given by the Superannuation Complaints Tribunal; or

                     (g)  a direction given by a member (within the meaning of the Superannuation Contributions Tax (members of Constitutionally Protected Superannuation Funds) Assessment and Collection Act 1997) that is permitted to be given by subsection 15(8A) of that Act.

             (3)  If the governing rules of a superannuation entity are inconsistent with subsection (1), that subsection prevails, and the governing rules are, to the extent of the inconsistency, invalid.

59  Exercise of discretion by person other than trustee

             (1)  Subject to subsection (1A), the governing rules of a superannuation entity other than a self managed superannuation fund must not permit a discretion under those rules that is exercisable by a person other than a trustee of the entity to be exercised unless:

                     (a)  those rules require the consent of the trustee, or the trustees, of the entity to the exercise of that discretion; or

                     (b)  if the entity is an employer‑sponsored fund:

                              (i)  the exercise of the discretion relates to the contributions that an employer‑sponsor will, after the discretion is exercised, be required or permitted to pay to the fund; or

                             (ii)  the exercise of the discretion relates solely to a decision to terminate the fund; or

                            (iii)  the circumstances in which the discretion was exercised are covered by regulations made for the purposes of this subparagraph.

          (1A)  Despite subsection (1), the governing rules of a superannuation entity may, subject to a trustee of the entity complying with any conditions contained in the regulations, permit a member of the entity, by notice given to a trustee of the entity in accordance with the regulations, to require a trustee of the entity to provide any benefits in respect of the member on or after the member’s death to a person or persons mentioned in the notice, being the legal personal representative or a dependant or dependants of the member.

             (2)  If the governing rules of a superannuation entity are inconsistent with subsection (1), that subsection prevails, and the governing rules are, to the extent of the inconsistency, invalid.

60  Amendment of governing rules

             (1)  The governing rules of a superannuation entity other than a self managed superannuation fund must not permit those rules to be amended unless:

                     (a)  the trustee, or the trustees, of the entity have consented to the amendment; or

                     (b)  if the entity is an employer‑sponsored fund:

                              (i)  the amendment relates to the contributions that an employer‑sponsor will, after the amendment, be required or permitted to pay to the fund; or

                             (ii)  the amendment relates solely to the termination of the fund; or

                            (iii)  the circumstances in which the amendment was made are covered by regulations made for the purposes of this subparagraph; or

                     (c)  the amendment is made solely for the purpose of conferring on the trustee, or the trustees, the power to consent to amendments of those rules.

             (2)  The governing rules of a regulated superannuation fund must not permit those rules to be amended in such a way that:

                     (a)  a person other than a constitutional corporation would be eligible to be appointed as trustee unless the rules provide, and will continue to provide after the amendment is made, that the fund has, as its sole or primary purpose, the provision of old‑age pensions; or

                     (b)  the sole or primary purpose of the fund would be a purpose other than the provision of old‑age pensions unless the rules provide, and will continue to provide after the amendment is made, that the trustee must be a constitutional corporation.

             (3)  If the governing rules of the superannuation entity are inconsistent with subsection (1) or (2), the subsection concerned prevails, and the governing rules are, to the extent of the inconsistency, invalid.

60A  Dismissal of trustee of public offer entity

             (1)  Subject to subsection (2), the governing rules of a public offer entity must not permit the trustee to be removed by a person other than APRA.

Note:          Part 17 provides for the removal of trustees by APRA.

             (2)  Subsection (1) does not apply to a removal of a kind specified in regulations made for the purposes of this subsection.

             (3)  If the governing rules of the public offer entity are inconsistent with subsection (1), that subsection prevails, and the governing rules are, to the extent of the inconsistency, invalid.

 

Part 7—Provisions applying only to regulated superannuation funds

  

61  Object of Part

                   The object of this Part is to set out special rules which apply only to regulated superannuation funds.

62  Sole purpose test

             (1)  Each trustee of a regulated superannuation fund must ensure that the fund is maintained solely:

                     (a)  for one or more of the following purposes (the core purposes):

                              (i)  the provision of benefits for each member of the fund on or after the member’s retirement from any business, trade, profession, vocation, calling, occupation or employment in which the member was engaged (whether the member’s retirement occurred before, or occurred after, the member joined the fund);

                             (ii)  the provision of benefits for each member of the fund on or after the member’s attainment of an age not less than the age specified in the regulations;

                            (iii)  the provision of benefits for each member of the fund on or after whichever is the earlier of:

                                        (A)  the member’s retirement from any business, trade, profession, vocation, calling, occupation or employment in which the member was engaged; or

                                        (B)  the member’s attainment of an age not less than the age prescribed for the purposes of subparagraph (ii);

                            (iv)  the provision of benefits in respect of each member of the fund on or after the member’s death, if:

                                        (A)  the death occurred before the member’s retirement from any business, trade, profession, vocation, calling, occupation or employment in which the member was engaged; and

                                        (B)  the benefits are provided to the member’s legal personal representative, to any or all of the member’s dependants, or to both;

                             (v)  the provision of benefits in respect of each member of the fund on or after the member’s death, if:

                                        (A)  the death occurred before the member attained the age prescribed for the purposes of subparagraph (ii); and

                                        (B)  the benefits are provided to the member’s legal personal representative, to any or all of the member’s dependants, or to both; or

                     (b)  for one or more of the core purposes and for one or more of the following purposes (the ancillary purposes):

                              (i)  the provision of benefits for each member of the fund on or after the termination of the member’s employment with an employer who had, or any of whose associates had, at any time, contributed to the fund in relation to the member;

                             (ii)  the provision of benefits for each member of the fund on or after the member’s cessation of work, if the work was for gain or reward in any business, trade, profession, vocation, calling, occupation or employment in which the member was engaged and the cessation is on account of ill‑health (whether physical or mental);

                            (iii)  the provision of benefits in respect of each member of the fund on or after the member’s death, if:

                                        (A)  the death occurred after the member’s retirement from any business, trade, profession, vocation, calling, occupation or employment in which the member was engaged (whether the member’s retirement occurred before, or occurred after, the member joined the fund); and

                                        (B)  the benefits are provided to the member’s legal personal representative, to any or all of the member’s dependants, or to both;

                            (iv)  the provision of benefits in respect of each member of the fund on or after the member’s death, if:

                                        (A)  the death occurred after the member attained the age prescribed for the purposes of subparagraph (a)(ii); and

                                        (B)  the benefits are provided to the member’s legal personal representative, to any or all of the member’s dependants, or to both;

                             (v)  the provision of such other benefits as the Regulator approves in writing.

          (1A)  Subsection (1) does not imply that a trustee of a regulated superannuation fund is required to maintain the fund so that the same kind of benefits will be provided:

                     (a)  to each member of the fund; or

                     (b)  in respect of each member of the fund.

             (2)  Subsection (1) is a civil penalty provision as defined by section 193, and Part 21 therefore provides for civil and criminal consequences of contravening, or of being involved in a contravention of, that subsection.

             (3)  An approval given by the Regulator for the purposes of subsection (1) may be expressed to relate to:

                     (a)  a specified fund; or

                     (b)  a specified class of funds.

63  Certain regulated superannuation funds not to accept employer contributions in certain circumstances

Directions

             (1)  The Regulator may give a trustee of a regulated superannuation fund a written notice directing the trustee, or the trustees, not to accept any contributions made to the fund by an employer‑sponsor.

Pre‑1994‑95 directions

             (2)  The Commissioner may only give a direction under this section to the trustee of a fund before the fund’s 1994‑95 year of income (whether in accordance with section 4 of the Acts Interpretation Act 1901 or otherwise) if the direction takes effect at the beginning of that year of income and, at a time during the period:

                     (a)  beginning on the day on which this Act received the Royal Assent; and

                     (b)  ending immediately before the beginning of that year of income;

when:

                     (c)  the fund was in existence; and

                     (d)  there were in force regulations for the purposes of subsection 7(1) of the Occupational Superannuation Standards Act 1987 prescribing standards applicable to the fund;

the fund did not comply with any or all of those standards.

Post‑1993‑94 directions

             (3)  The Regulator must not give a direction under this section to a trustee of a fund after the beginning of the fund’s 1994‑95 year of income unless:

                     (a)  a trustee of the fund has contravened one or more of the regulatory provisions (as defined in section 38A) on one or more occasions after the beginning of that year of income; and

                     (b)  the Regulator is satisfied that the seriousness or frequency, or both, of the contraventions warrants the giving of the direction.

Reasons

             (4)  A direction under this section must be accompanied by, or included in the same document as, a statement giving the reasons for the direction.

Revocation

             (5)  The Regulator may revoke a direction under this section if the Regulator is satisfied that there is, and is likely to continue to be, substantial compliance by each trustee of the fund with the regulatory provisions (as defined in section 38A) applicable to the fund.

Contravention of equal representation rules

             (6)  For the purposes of subsections (3) and (5), if a fund does not comply with Part 9 (which deals with equal representation), the trustee of the fund is, or the trustees of the fund are, taken to have contravened the applicable provisions of that Part.

Offence of contravening direction

             (7)  A trustee of a fund must not, without reasonable excuse, contravene a direction under this section.

Penalty:  100 penalty units.

          (7A)  Subsection (7) is an offence of strict liability.

Note 1:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Note 2:       For strict liability, see section 6.1 of the Criminal Code.

Additional rule for certain funds not complying with equal representation rules

          (7B)  An RSE licensee of a fund that is not a public offer superannuation fund must not, while subsection (7D) applies to the fund, accept any contributions made to the fund by an employer‑sponsor.

Penalty:  60 penalty units.

          (7C)  Subsection (7B) is an offence of strict liability.

Note 1:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Note 2:       For strict liability, see section 6.1 of the Criminal Code.

          (7D)  This subsection applies to the fund if:

                     (a)  the fund is failing to comply with subsection 92(4) or 93(4) (whichever is applicable); or

                     (b)  having previously failed to comply, the fund does so comply but the RSE licensee has not given to APRA a notice in the approved form that:

                              (i)  states that the fund so complies; and

                             (ii)  if the RSE licensee is a group of individual trustees and the compliance is as a result of the appointment of one or more other individual trustees to the group—states the appointee’s name or the appointees’ names; and

                            (iii)  if the RSE licensee is a body corporate and the compliance is as a result of the appointment of one or more directors to the board of directors of the body corporate—states the appointee’s name or the appointees’ names.

Refund of contributions

             (8)  A contravention of subsection (7) or (7B) does not result in the invalidity of a transaction. However, if a contribution is accepted in contravention of either of those subsections, a trustee of the fund concerned must refund the contribution within 28 days or such further period as the Regulator allows.

Notification to employer‑sponsors

             (9)  If a trustee of a fund is given a direction under this section, each trustee of the fund must ensure that all reasonable steps are taken to notify the direction to each employer‑sponsor of the fund.

Offence of contravening subsection (8) or (9)

           (10)  A person who, without reasonable excuse, contravenes subsection (8) or (9) is guilty of an offence punishable on conviction by a fine not exceeding 50 penalty units.

        (10A)  Subsection (10) is an offence of strict liability.

Note 1:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Note 2:       For strict liability, see section 6.1 of the Criminal Code.

Refunded contributions to be ignored for the purposes of income tax and superannuation guarantee charge

           (11)  For the purposes of the Income Tax Assessment Act and the Superannuation Guarantee (Administration) Act 1992, if a contribution is refunded under this section, the person who made the contribution is taken never to have made the contribution.

Superannuation guarantee charge—shortfall component to be treated as employer contribution

           (12)  This section has effect as if the payment of a shortfall component to a fund under section 65 of the Superannuation Guarantee (Administration) Act 1992 were a contribution made to the fund by an employer‑sponsor.

OSSA

           (13)  A reference in this section to subsection 7(1) of the Occupational Superannuation Standards Act 1987 includes a reference to that subsection as it continues to apply, despite its repeal, because of the Occupational Superannuation Standards Amendment Act 1993.

64  Superannuation contributions—deductions from salary or wages to be remitted promptly

Application

             (1)  This section applies if:

                     (a)  an employer of an employee is authorised (whether by the employee, by force of law or otherwise) to:

                              (i)  deduct an amount from salary or wages payable by the employer to the employee; and

                             (ii)  pay to a trustee of a regulated superannuation fund the amount of the deduction for the purposes of making provision for superannuation benefits for, or for dependants of, the employee; and

                     (b)  the employer makes such a deduction.

Prompt remission

             (2)  The employer must pay to a trustee of the superannuation fund the amount of the deduction before the end of the 28‑day period beginning immediately after the end of the month in which the deduction was made.

             (3)  The employer is guilty of an offence if the employer contravenes subsection (2).

Maximum penalty:    100 penalty units.

          (3A)  The employer is guilty of an offence if the employer contravenes subsection (2). This is an offence of strict liability.

Maximum penalty:    50 penalty units.

Note 1:       Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Note 2:       For strict liability, see section 6.1 of the Criminal Code.

Definition

             (4)  In this section:

salary or wages has the same meaning as in the Superannuation Guarantee (Administration) Act 1992.

Part‑time domestic workers counted

             (5)  For the purposes of this section, the Superannuation Guarantee (Administration) Act 1992 has effect as if subsection 11(2) of that Act had not been enacted.

64A  Compliance with determinations of the Superannuation Complaints Tribunal

             (1)  If:

                     (a)  a complaint has been made to the Superannuation Complaints Tribunal under section 14 of the Superannuation (Resolution of Complaints) Act 1993 concerning a disability benefit (whether under a contract of insurance or otherwise); and

                     (b)  the Tribunal decides that a person other than a trustee or an insurer is responsible for determining the existence of the disability; and

                     (c)  the Tribunal joins the person under paragraph 18(1)(d) of that Act as a party to the complaint;

the person must comply with any determination made in respect of the person by the Tribunal.

             (2)  In this section:

Superannuation Complaints Tribunal means the Superannuation Complaints Tribunal established under section 6 of the Superannuation (Resolution of Complaints) Act 1993.

65  Lending to members of regulated superannuation fund prohibited

Prohibition

             (1)  A trustee or an investment manager of a regulated superannuation fund must not:

                     (a)  lend money of the fund to:

                              (i)  a member of the fund; or

                             (ii)  a relative of a member of the fund; or

                     (b)  give any other financial assistance using the resources of the fund to:

                              (i)  a member of the fund; or

                             (ii)  a relative of a member of the fund.

Exception—private sector funds

             (2)  Subsection (1) does not prohibit the lending of money of a private sector fund established before 16 December 1985 to a member if the trustee of the fund, on or before that date:

                     (a)  had express power to lend money to members; or

                     (b)  lent money to members and that lending was not expressly prohibited by the governing rules of the fund.

Exception—public sector funds

             (3)  Subsection (1) does not prohibit the lending of money of a public sector fund established before 25 May 1988 to a member if the trustee of the fund, on or before that date:

                     (a)  had express power to lend money to members; or

                     (b)  lent money to members and that lending was not expressly prohibited by the governing rules of the fund.

Variation of governing rules

             (4)  If:

                     (a)  subsection (2) or (3) applies to a regulated superannuation fund; and

                     (b)  at the beginning of the fund’s 1994‑95 year of income, a provision included in the governing rules of the fund authorised the lending of the fund’s money to members;

a variation of that provision is void unless the variation: