Corporations Act 2001

Act No. 50 of 2001 as amended

This compilation was prepared on 8 February 2012
taking into account amendments up to Act No. 132 of 2011

Volume 4 includes: Table of Contents
   Chapters 7 and 8 (ss. 760A – 1200U)

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

Contents

Chapter 7—Financial services and markets

Part 7.1—Preliminary

Division 1—Object of Chapter and outline of Chapter

760A Object of Chapter

760B Outline of Chapter

Division 2—Definitions

761A Definitions

761B Meaning of arrangement—2 or more arrangements that together form a derivative or other financial product

761C Meaning of carry on a financial services business

761CA Meaning of class and kind of financial products and financial services

761D Meaning of derivative

761E Meaning of issued, issuer, acquire and provide in relation to financial products

761EA Meaning of margin lending facility, margin call and associated expressions

761F Meaning of person—generally includes a partnership

761FA Meaning of person—generally includes multiple trustees

761G Meaning of retail client and wholesale client

761GA Meaning of retail client—sophisticated investors

761H References to this Chapter include references to regulations or other instruments made for the purposes of this Chapter

Division 3—What is a financial product?

Subdivision A—Preliminary

762A Overview of approach to defining what a financial product is

762B What if a financial product is part of a broader facility?

762C Meaning of facility

Subdivision B—The general definition

763A General definition of financial product

763B When a person makes a financial investment

763C When a person manages financial risk

763D When a person makes non‑cash payments

763E What if a financial product is only incidental?

Subdivision C—Specific inclusions

764A Specific things that are financial products (subject to Subdivision D)

Subdivision D—Specific exclusions

765A Specific things that are not financial products

Division 4—When does a person provide a financial service?

766A When does a person provide a financial service?

766B Meaning of financial product advice

766C Meaning of dealing

766D Meaning of makes a market for a financial product

766E Meaning of provide a custodial or depository service

Division 5—What is a financial market?

767A What is a financial market?

Division 6—What is a clearing and settlement facility?

768A What is a clearing and settlement facility?

Division 7—General provisions relating to civil and criminal liability

769A Part 2.5 of Criminal Code does not apply

769B People are generally responsible for the conduct of their agents, employees etc.

769C Representations about future matters taken to be misleading if made without reasonable grounds

Part 7.2—Licensing of financial markets

Division 1—Preliminary

790A Definition

Division 2—Requirement to be licensed

791A Need for a licence

791B Other prohibitions on holding out

791C Exemptions

791D When a market is taken to be operated in this jurisdiction

Division 3—Regulation of market licensees

Subdivision A—Licensee’s obligations

792A General obligations

792B Obligation to notify ASIC of certain matters

792C Giving ASIC information about a listed disclosing entity

792D Obligation to assist ASIC

792E Obligation to give ASIC access to market facilities

792F Annual report

792G Obligations to notify people about clearing and settlement arrangements in certain circumstances

792H Change of country by foreign licensee

792I Making information about compensation arrangements publicly available

Subdivision B—The market’s operating rules and procedures

793A Content of the operating rules and procedures

793B Legal effect of operating rules

793C Enforcement of operating rules

793D Changing the operating rules

793E Disallowance of changes to operating rules

Subdivision C—Powers of the Minister and ASIC

794A Minister’s power to give directions

794B Minister’s power to require special report

794C ASIC to assess licensee’s compliance

794D ASIC’s power to give directions

794E Additional directions to clearing and settlement facilities

Division 4—The Australian market licence

Subdivision A—How to get a licence

795A How to apply for a licence

795B When a licence may be granted

795C Publication of notice of licence grant

795D More than one licence in the same document

795E More than one market covered by the same licence

Subdivision B—The conditions on the licence

796A The conditions on the licence

Subdivision C—When a licence can be varied, suspended or cancelled

797A Varying licences

797B Immediate suspension or cancellation

797C Suspension or cancellation following hearing and report

797D Effect of suspension

797E Variation or revocation of suspension

797F Publication of notice of licence suspension or cancellation

797G Suspension and cancellation only in accordance with this Subdivision

Division 5—Other matters

798A Matters to be taken into account by the Minister

798B ASIC may give advice to Minister

798C Market licensee or related body corporate etc. listing on market

798D Exemptions and modifications for self‑listing licensees or related bodies corporate etc.

798DA Market licensee, related body corporate etc. or competitor participating in market

798E Other potential conflict situations

Part 7.2A—Supervision of financial markets

798F ASIC to supervise financial markets

798G Market integrity rules

798H Complying with market integrity rules

798J Directions by ASIC

798K Alternatives to civil proceedings

798L Exemptions and modifications by regulations

Part 7.3—Licensing of clearing and settlement facilities

Division 1—Requirement to be licensed

820A Need for a licence

820B Other prohibitions on holding out

820C Exemptions

820D When a clearing and settlement facility is taken to be operated in this jurisdiction

Division 2—Regulation of CS facility licensees

Subdivision A—Licensee’s obligations

821A General obligations

821B Obligation to notify ASIC of certain matters

821BA Obligation to notify Reserve Bank of certain matters

821C Obligation to assist

821D Obligation to give ASIC access to the facility

821E Annual report

821F Change of country by foreign licensee

Subdivision B—The facility’s operating rules and procedures

822A Content of the operating rules and procedures

822B Legal effect of operating rules

822C Enforcement of operating rules

822D Changing the operating rules

822E Disallowance of changes to operating rules

Subdivision C—Powers of the Minister, ASIC and the Reserve Bank in relation to licensees

823A Minister’s power to give directions

823B Minister’s power to require special report

823C ASIC to assess licensee’s compliance

823CA Reserve Bank to assess licensee’s compliance

823D Directions power—protecting dealings in financial products and ensuring fair and effective provision of services by CS facilities

823E Directions power—reduction of systemic risk

Division 3—The Australian CS facility licence

Subdivision A—How to get a licence

824A How to apply for a licence

824B When a licence may be granted

824C Publication of notice of licence grant

824D More than one licence in the same document

824E More than one CS facility covered by the same licence

Subdivision B—The conditions on the licence

825A The conditions on the licence

Subdivision C—When a licence can be varied, suspended or cancelled

826A Varying licences

826B Immediate suspension or cancellation

826C Suspension or cancellation following hearing and report

826D Effect of suspension

826E Variation or revocation of suspension

826F Publication of notice of licence suspension or cancellation

826G Suspension and cancellation only in accordance with this Subdivision

Division 4—Other matters

827A Matters to be taken into account by the Minister

827B ASIC may give advice to Minister

827C Reserve Bank may give advice to Minister

827D Reserve Bank may determine financial stability standards

Part 7.4—Limits on involvement with licensees

Division 1—Limit on control of certain licensees

Subdivision A—15% voting power limit

850A Scope of Division

850B Meaning of unacceptable control situation

850C Acquisitions of shares

850D Remedial orders

850E Injunctions

Subdivision B—Approval to exceed 15% voting power limit

851A Application for approval to exceed 15% voting power limit

851B Approval of application

851C Duration of approval

851D Conditions of approval

851E Varying percentage approved

851F Revoking an approval

851G Further information about applications

851H Time limit for Minister’s decision

851I Preservation of voting power in relation to bodies specified in regulations made for section 850A

Subdivision C—Other matters

852A Acquisition of property

852B Anti‑avoidance

Division 2—Individuals who are not fit and proper are disqualified

853A Who is disqualified

853B When an individual is involved in an operator

853C Declaration by ASIC

853D Procedure for declaration

853E Revoking a declaration

853F Obligations on disqualified individuals

853G Notification by ASIC

Division 3—Miscellaneous

854A Record‑keeping and giving of information

854B Exemptions and modifications by regulations

Part 7.5—Compensation regimes for financial markets

Division 1—Preliminary

880A Part does not apply to markets licensed under special provisions about overseas markets

880B Definitions

Division 2—When there must be a compensation regime

881A Licensed markets through which participants provide services for retail clients must generally have a compensation regime

881B Additional requirements for the licence application

881C What happens if an application contains information in accordance with paragraph 881B(2)(c)

881D What happens if an application contains a statement in accordance with paragraph 881B(2)(d)

Division 3—Approved compensation arrangements

Subdivision A—Approval of compensation arrangements

882A How to get compensation arrangements approved with grant of licence

882B How to get compensation arrangements approved after licence is granted

882C Revocation of approval

882D Minister’s power to give directions

Subdivision B—Effect of compensation rules forming part of Division 3 arrangements

883A Legal effect of compensation rules

883B Enforcement of compensation rules

883C Other sources of funds for compensation

883D Payment of levies

Subdivision C—Changing Division 3 arrangements

884A Division 3 arrangements must generally only be changed in accordance with this Subdivision

884B Changing Division 3 arrangements—matters required to be dealt with in the compensation rules

884C Changing Division 3 arrangements—matters not required to be dealt with in the compensation rules

Subdivision D—Are compensation arrangements adequate?

885A Purpose of this Subdivision

885B Requirements to be complied with for arrangements to be adequate

885C The losses to be covered

885D Certain losses that are not Division 3 losses

885E The amount of compensation

885F Method of payment of compensation

885G Making and determination of claims

885H The source of funds—general

885I Administration and monitoring

885J The losses to be covered—other matters to be taken into account

Subdivision E—Other provisions about Division 3 arrangements

886A Only one claim in respect of the same loss

886B Regulations relating to fidelity funds

Division 4—NGF Compensation regime

Subdivision A—Application of Division

887A Markets to which this Division applies

Subdivision B—Claims for and payment of compensation

888A The situations in which compensation may be claimed

888B Kinds of compensation available

888C Amount of compensation payable

888D Payment of compensation

888E Making and determination of claims

888F The SEGC has power to determine claims

888G Allowing a claim does not constitute an admission of any other liability

888H Claimant may apply to Court if claim disallowed

888I Non‑NGF property of the SEGC not available to meet claims

888J The SEGC may enter into contracts of insurance or indemnity

888K NGF may be used to acquire financial products to be transferred as compensation

Subdivision C—The NGF

889A Continuation of the National Guarantee Fund

889B Compensation to be provided out of the NGF

889C The SEGC to keep the NGF

889D What the NGF consists of

889E Power to borrow etc. for purposes of the NGF

889F Money borrowed and paid to the SEGC

889G Money borrowed and not paid to the SEGC

889H Payments out of the NGF

889I Minimum amount of the NGF

889J Levy by the SEGC

889K Levy by market operator

Subdivision D—The SEGC

890A Minister to nominate the SEGC

890B The SEGC’s functions and powers

890C Delegation

890D Operating rules of the SEGC

890E Legal effect of the SEGC’s operating rules

890F Enforcement of the SEGC’s operating rules

890G Changing the SEGC’s operating rules

890H Disallowance of changes to the SEGC’s operating rules

Subdivision E—Other provisions relating to compensation under this Division

891A Payment out of the NGF to prescribed body with arrangements covering clearing and settlement facility support

891B Markets operated by bodies corporate that become members of the SEGC—regulations may deal with transitional provisions and other matters

891C Regulations may make different provision in respect of different markets etc.

Division 5—Provisions common to both kinds of compensation arrangements

892A Definitions

892B How regulated funds are to be kept

892C Money in regulated funds may be invested

892D Powers of relevant authority to require production or delivery of documents or statements

892E Power to require assistance for purpose of dealing with a claim

892F Relevant authority’s right of subrogation if compensation is paid

892G Excess money in compensation funds

892H Accounting and reporting for regulated funds

892I Division 3 arrangements—reporting in situations where compensation does not come out of a regulated fund

892J Regulations may provide for qualified privilege in respect of certain matters

892K Risk assessment report

Division 6—Miscellaneous

893A Exemptions and modifications by regulations

Part 7.6—Licensing of providers of financial services

Division 1—Preliminary

910A Definitions

Division 2—Requirement to be licensed or authorised

911A Need for an Australian financial services licence

911B Providing financial services on behalf of a person who carries on a financial services business

911C Prohibition on holding out

911D When a financial services business is taken to be carried on in this jurisdiction

Division 3—Obligations of financial services licensees

912A General obligations

912B Compensation arrangements if financial services provided to persons as retail clients

912C Direction to provide a statement

912CA Regulations may require information to be provided

912D Obligation to notify ASIC of certain matters

912E Surveillance checks by ASIC

912F Obligation to cite licence number in documents

Division 4—Australian financial services licences

Subdivision A—How to get a licence

913A Applying for a licence

913B When a licence may be granted

913C Licence numbers

Subdivision B—The conditions on the licence

914A The conditions on the licence

Subdivision C—When a licence can be varied, suspended or cancelled

915A Varying licences

915B Immediate suspension or cancellation

915C Suspension or cancellation after offering a hearing

915D Effect of suspension

915E Revocation of suspension

915F Date of effect and publication of cancellation or suspension

915G Statement of reasons

915H ASIC may allow licence to continue in effect

915I Special procedures for APRA‑regulated bodies

915J Variation, suspension and cancellation only under this Subdivision

Division 5—Authorised representatives

916A How representatives are authorised

916B Sub‑authorisations

916C Authorised representative of 2 or more licensees

916D Licensees cannot authorise other licensees

916E Licensees acting under a binder

916F Obligation to notify ASIC etc. about authorised representatives

916G ASIC may give licensee information about representatives

Division 6—Liability of financial services licensees for representatives

917A Application of Division

917B Responsibility if representative of only one licensee

917C Representatives of multiple licensees

917D Exception if lack of authority is disclosed to client

917E Responsibility extends to loss or damage suffered by client

917F Effect of Division

Division 8—Banning or disqualification of persons from providing financial services

Subdivision A—Banning orders

920A ASIC’s power to make a banning order

920B What is a banning order?

920C Effect of banning orders

920D Variation or cancellation of banning orders

920E Date of effect and publication of banning order, variation or cancellation

920F Statement of reasons

Subdivision B—Disqualification by the Court

921A Disqualification by the Court

Division 9—Registers relating to financial services

922A Registers relating to financial services

922B Inspection of Registers

Division 10—Restrictions on use of terminology

923A Restriction on use of certain words or expressions

923B Restriction on use of certain words or expressions unless authorised in licence conditions

Division 11—Agreements with unlicensed persons relating to the provision of financial services

Subdivision A—Agreements affected

924A Agreements with certain unlicensed persons

Subdivision B—Effect on agreements

925A Client may give notice of rescission

925B Effect of notice under section 925A

925C Client may apply to Court for partial rescission

925D Court may make consequential orders

925E Agreement unenforceable against client

925F Non‑licensee not entitled to recover commission

925G Onus of establishing non‑application of section 925E or 925F

925H Client may recover commission paid to non‑licensee

925I Remedies under this Division additional to other remedies

Division 12—Miscellaneous

926A Exemptions and modifications by ASIC

926B Exemptions and modifications by regulations

Part 7.7—Financial services disclosure

Division 1—Preliminary

940A How Part applies if a financial services licensee is acting as authorised representative

940B What if there is no reasonable opportunity to give a document, information or statement required by this Part?

940C How documents, information and statements are to be given

940D General approach to offence provisions

Division 2—Person provided with financial service as retail client to be given a Financial Services Guide

Subdivision A—Requirement for a Financial Services Guide to be given

941A Obligation on financial services licensee to give a Financial Services Guide if financial service provided to person as a retail client

941B Obligation on authorised representative to give a Financial Services Guide if financial service provided to person as a retail client

941C Situations in which a Financial Services Guide is not required

941D Timing of giving Financial Services Guide

941E Information must be up to date

941F Obligation to give updated Financial Services Guide

Subdivision B—Content and authorisation of Financial Services Guide

942A Title of Financial Services Guide

942B Financial Services Guide given by financial services licensee—main requirements

942C Financial Services Guide given by authorised representative—main requirements

942D Financial Services Guide may consist of 2 or more separate documents given at same time

942DA Combining a Financial Services Guide and a Product Disclosure Statement in a single document

942E Altering a Financial Services Guide after its preparation and before giving it to a person

Subdivision C—Supplementary Financial Services Guides

943A What a Supplementary Financial Services Guide is

943B Title of Supplementary Financial Services Guide

943C Form of Supplementary Financial Services Guide

943D Effect of giving a person a Supplementary Financial Services Guide

943E Situation in which only a Supplementary Financial Services Guide need be given

943F Altering a Supplementary Financial Services Guide after its preparation and before giving it to a person

Division 3—Additional requirements for personal advice provided to a retail client

Subdivision A—When this Division applies

944A Situation in which Division applies

Subdivision B—Requirements relating to basis of advice

945A Requirement to have a reasonable basis for the advice

945B Obligation to warn client if advice based on incomplete or inaccurate information

Subdivision C—Requirement for a Statement of Advice to be given

946A Obligation to give client a Statement of Advice

946AA Small investments—Statement of Advice not required

946B Other situations in which a Statement of Advice is not required

946C Timing of giving Statement of Advice

Subdivision D—Content of Statement of Advice

947A Title of Statement of Advice

947B Statement of Advice given by financial services licensee—main requirements

947C Statement of Advice given by authorised representative—main requirements

947D Additional requirements when advice recommends replacement of one product with another

947E Statement of Advice not to be combined with Financial Services Guide or Product Disclosure Statement

Subdivision E—Other matters

948A Qualified privilege if providing entity complies with this Division

Division 4—Other disclosure requirements

949A General advice provided to retail client—obligation to warn client that advice does not take account of client’s objectives, financial situation or needs

949B Regulations may impose disclosure requirements in certain situations

Division 6—Miscellaneous

951A Part cannot be contracted out of

951B Exemptions and modifications by ASIC

951C Exemptions and modifications by regulations

Division 7—Enforcement

Subdivision A—Offences

952A Overview

952B Definitions

952C Offence of failing to give a disclosure document or statement

952D Offence of giving a disclosure document or statement knowing it to be defective

952E Offence of giving a defective disclosure document or statement (whether or not known to be defective)

952F Offences of financial services licensee knowingly providing defective disclosure material to an authorised representative

952G Offences of financial services licensee providing disclosure material to an authorised representative (whether or not known to be defective)

952H Offence of financial services licensee failing to ensure authorised representative gives disclosure documents or statements as required

952I Offences if a Financial Services Guide (or Supplementary FSG) does not comply with certain requirements

952J Offence if a Statement of Advice does not comply with certain requirements

952K Offence if authorised representative gives out unauthorised Financial Services Guide (or Supplementary FSG)

952L Offences if financial services licensee or authorised representative becomes aware that a Financial Services Guide (or Supplementary FSG) is defective

952M Offence of unauthorised alteration of Financial Services Guide or Supplementary Financial Services Guide

Subdivision B—Civil liability

953A Definitions

953B Civil action for loss or damage

953C Additional powers of court to make orders

Part 7.8—Other provisions relating to conduct etc. connected with financial products and financial services, other than financial product disclosure

Division 1—Preliminary

980A Matters covered by this Part

980B General approach to offence provisions

Division 2—Dealing with clients’ money

Subdivision A—Money other than loans

981A Money to which Subdivision applies

981B Obligation to pay money into an account

981C Regulations may deal with various matters relating to accounts maintained for the purposes of section 981B

981D Money related to derivatives may be used for general margining etc. purposes

981E Protection of money from attachment etc.

981F Regulations may deal with how money to be dealt with if licensee ceases to be licensed etc.

981G Account provider not liable merely because of licensee’s contravention

981H Money to which Subdivision applies taken to be held in trust

Subdivision B—Loan money

982A Money to which this Subdivision applies

982B Obligation to pay money into an account

982C Licensee to give client statement setting out terms of loan etc.

982D Permitted use of loan

Subdivision C—Powers of Court

983A Court may freeze certain accounts

983B Interim order freezing accounts

983C Duty of person to whom order directed to make full disclosure

983D Further orders and directions

983E Power of Court to make order relating to payment of money

Division 3—Dealing with other property of clients

984A Property to which Division applies

984B How property to which this Division applies is to be dealt with

Division 4—Special provisions relating to insurance

985A Definitions etc.

985B Status of amounts paid to financial services licensees in respect of contracts of insurance

985C Regulations may impose other requirements etc. if financial services licensee is not the insurer

985D Financial services licensees etc. not to deal in general insurance products from unauthorised insurers etc.

Division 4A—Special provisions relating to margin lending facilities

Subdivision A—Responsible lending conduct for margin lending facilities

985EA Application of this Subdivision

985E Requirements before issuing etc. margin lending facility

985F Assessment of unsuitability of margin lending facility

985G Reasonable inquiries etc. about the retail client

985H When margin lending facility must be assessed as unsuitable

985J Giving the retail client the assessment

985K Unsuitable margin lending facilities

Subdivision B—Notice of margin calls under margin lending facilities

985L Issue of margin lending facility must not be conditional on agreement to receive communications through agent

985M Notification of margin calls

Division 5—Obligations to report

986A Reporting in relation to money to which Subdivision A or B of Division 2 applies or property to which Division 3 applies

986B Reporting in relation to dealings in derivatives

Division 6—Financial records, statements and audit

Subdivision A—Preliminary

987A Application of Division

Subdivision B—Financial records of financial services licensees

988A Obligation to keep financial records

988B Records to be kept so that profit and loss statements and balance sheet can be prepared and audited

988C Language of records

988D Location of records

988E Particular categories of information to be shown in records

988F Regulations may impose additional requirements

988G Records taken to be made with licensee’s authority

Subdivision C—Financial statements of financial services licensees

989A Meaning of financial year

989B Financial services licensee to prepare and lodge annual profit and loss statement and balance sheet

989C Requirements as to contents and applicable accounting principles

989CA Audit to be conducted in accordance with auditing standards

989D Time of lodgment

Subdivision D—Appointment etc. of auditors

990A Sections 990B to 990H not to apply to public companies

990B Appointment of auditor by licensee

990C When a person or firm is ineligible to act as auditor

990D Ineligible person or firm must not consent to act or disqualify themselves etc.

990E Duration of appointment of auditors

990F Removal of auditors

990G Resignation of auditors—requirements for resignation

990H Resignation of auditors—when resignation takes effect

990I Auditor’s right of access to records, information etc.

990J Auditor’s fees and expenses

990K Auditor to report on certain matters

990L Qualified privilege for auditor etc.

Division 7—Other rules about conduct

991A Financial services licensee not to engage in unconscionable conduct

991B Financial services licensee to give priority to clients’ orders

991C Regulations may deal with various matters relating to instructions to deal through licensed markets

991D Regulations may require records to be kept in relation to instructions to deal on licensed markets and foreign markets

991E Obligations of financial services licensee in relation to dealings with non‑licensees

991F Dealings involving employees of financial services licensees

Division 8—Miscellaneous

992A Prohibition on hawking of certain financial products

992AA Prohibition of hawking of managed investment products

992B Exemptions and modifications by ASIC

992C Exemptions and modifications by regulations

Division 9—Enforcement

993A Overview

993B Offence of failing to pay client money into an account as required

993C Offence of failing to comply with requirements relating to client money account

993D Offence of failing to pay loan money into an account as required

Part 7.9—Financial product disclosure and other provisions relating to issue, sale and purchase of financial products

Division 1—Preliminary

1010A Part generally does not apply to securities

1010B Part does not apply to financial products not issued in the course of a business

1010BA Part does not apply to contribution plans

1010C Special provisions about meaning of sale and offer

1010D General approach to offence provisions

Division 2—Product Disclosure Statements

Subdivision A—Preliminary

1011A Jurisidictional scope of Division

1011B Definitions

1011C Treatment of offers of options over financial products

Subdivision B—Requirement for a Product Disclosure Statement to be given

1012A Obligation to give Product Disclosure Statement—personal advice recommending particular financial product

1012B Obligation to give Product Disclosure Statement—situations related to issue of financial products

1012C Obligation to give Product Disclosure Statement—offers related to sale of financial products

1012D Situations in which Product Disclosure Statement is not required

1012DAA  Rights issues for which Product Disclosure Statement is not required

1012DA Product Disclosure Statement not required for sale amounting to indirect issue

1012E Small scale offerings of managed investment and other prescribed financial products (20 issues or sales in 12 months)

1012F Product Disclosure Statement for certain superannuation products may be provided later

1012G Product Disclosure Statement may sometimes be provided later

1012H Obligation to take reasonable steps to ensure that Product Disclosure Statement is given to person electing to be covered by group financial product

1012I Obligation to give employer a Product Disclosure Statement in relation to certain superannuation products and RSA products

1012IA Treatment of arrangements under which a person can instruct another person to acquire a financial product

1012J Information must be up to date

1012K Anti‑avoidance determinations

Subdivision C—Preparation and content of Product Disclosure Statements

1013A Who must prepare Product Disclosure Statement

1013B Title of Product Disclosure Statement

1013C Product Disclosure Statement content requirements

1013D Product Disclosure Statement content—main requirements

1013DA Information about ethical considerations etc.

1013E General obligation to include other information that might influence a decision to acquire

1013F General limitations on extent to which information is required to be included

1013FA Information not required to be included in PDS for continuously quoted securities

1013G Product Disclosure Statement must be dated

1013H Requirements if Product Disclosure Statement states or implies that financial product will be able to be traded

1013I Extra requirements if Product Disclosure Statement relates to managed investment products that are ED securities

1013J Requirements if Statement has been lodged with ASIC

1013K Requirements relating to consents to certain statements

1013L Product Disclosure Statement may consist of 2 or more separate documents given at same time

1013M Combining a Product Disclosure Statement and a Financial Services Guide in a single document

Subdivision D—Supplementary Product Disclosure Statements

1014A What a Supplementary Product Disclosure Statement is

1014B Title of Supplementary Product Disclosure Statement

1014C Form of Supplementary Product Disclosure Statement

1014D Effect of giving person a Supplementary Product Disclosure Statement

1014E Situation in which only a Supplementary Product Disclosure Statement need be given

1014F Application of other provisions in relation to Supplementary Product Disclosure Statements

Subdivision DA—Replacement Product Disclosure Statements

1014G Application of this Subdivision—stapled securities

1014H What a Replacement Product Disclosure Statement is

1014J Consequences of lodging a Replacement Product Disclosure Statement

1014K Form, content and preparation of Replacement Product Disclosure Statements

1014L Giving, lodgment and notice of Replacement Product Disclosure Statements

Subdivision E—Other requirements relating to Product Disclosure Statements and Supplementary Product Disclosure Statements

1015A Subdivision applies to Product Disclosure Statements and Supplementary Product Disclosure Statements

1015B Some Statements must be lodged with ASIC

1015C How a Statement is to be given

1015D Notice, retention and access requirements for Statement that does not need to be lodged

1015E Altering a Statement after its preparation and before giving it to a person

Subdivision F—Other rights and obligations related to Product Disclosure Statements

1016A Provisions relating to use of application forms

1016B If Statement lodged with ASIC, financial product is not to be issued or sold before specified period

1016C Minimum subscription condition must be fulfilled before issue or sale

1016D Condition about ability to trade on a market must be fulfilled before issue or sale

1016E Choices open to person making the offer if disclosure condition not met or Product Disclosure Statement defective

1016F Remedies for person acquiring financial product under defective Product Disclosure Document

Division 3—Other disclosure obligations of the issuer of a financial product

1017A Obligation to give additional information on request

1017B Ongoing disclosure of material changes and significant events

1017C Information for existing holders of superannuation products and RSA products

1017D Periodic statements for retail clients for financial products that have an investment component

1017DA Trustees of superannuation entities—regulations may specify additional obligations to provide information

1017E Dealing with money received for financial product before the product is issued

1017F Confirming transactions

1017G Certain product issuers and regulated persons must meet appropriate dispute resolution requirements

Division 4—Advertising for financial products

1018A Advertising or other promotional material for financial product must refer to Product Disclosure Statement

1018B Prohibition on advertising personal offers covered by section 1012E

Division 5—Cooling‑off periods

1019A Situations in which this Division applies

1019B Cooling‑off period for return of financial product

Division 5A—Unsolicited offers to purchase financial products off‑market

1019C Definitions

1019D Offers to which this Division applies

1019E How offers are to be made

1019F Prohibition on inviting offers to sell

1019G Duration and withdrawal of offers

1019H Terms of offer cannot be varied

1019I Contents of offer document

1019J Obligation to update market value

1019K Rights if requirements of Division not complied with

Division 5B—Disclosure etc. in relation to short sales covered by securities lending arrangement of listed section 1020B products

1020AA Definitions

1020AB Seller disclosure

1020AC Licensee disclosure

1020AD Public disclosure of information

1020AE Licensee’s obligation to ask seller about short sale

1020AF Regulations

Division 6—Miscellaneous

1020A Offers etc. relating to certain managed investment schemes not to be made in certain circumstances

1020B Prohibition of certain short sales of securities, managed investment products and certain other financial products

1020D Part cannot be contracted out of

1020E Stop orders by ASIC

1020F Exemptions and modifications by ASIC

1020G Exemptions and modifications by regulations

Division 7—Enforcement

Subdivision A—Offences

1021A Overview

1021B Definitions

1021C Offence of failing to give etc. a disclosure document or statement

1021D Offence of preparer of defective disclosure document or statement giving the document or statement knowing it to be defective

1021E Offence of preparer of defective disclosure document or statement giving the document or statement (whether or not known to be defective)

1021F Offence of regulated person (other than preparer) giving disclosure document or statement knowing it to be defective

1021FA Paragraph 1012G(3)(a) obligation—offences relating to communication of information

1021FB Paragraph 1012G(3)(a) obligation—offences relating to information provided by product issuer for communication by another person

1021G Offence of financial services licensee failing to ensure authorised representative gives etc. disclosure documents or statements as required

1021H Offences if a Product Disclosure Statement (or Supplementary PDS) does not comply with certain requirements

1021I Offence of giving disclosure document or statement that has not been prepared by the appropriate person

1021J Offences if preparer etc. of disclosure document or statement becomes aware that it is defective

1021K Offence of unauthorised alteration of Product Disclosure Statement (or Supplementary PDS)

1021L Offences of giving, or failing to withdraw, consent to inclusion of defective statement

1021M Offences relating to keeping and providing copies of Product Disclosure Statements (or Supplementary PDSs)

1021N Offence of failing to provide additional information requested under section 1017A

1021O Offences of issuer or seller of financial product failing to pay money into an account as required

1021P Offences relating to offers to which Division 5A applies

Subdivision B—Civil liability

1022A Definitions

1022B Civil action for loss or damage

1022C Additional powers of court to make orders

Part 7.10—Market misconduct and other prohibited conduct relating to financial products and financial services

Division 1—Preliminary

1040A Content of Part

Division 2—The prohibited conduct (other than insider trading prohibitions)

1041A Market manipulation

1041B False trading and market rigging—creating a false or misleading appearance of active trading etc.

1041C False trading and market rigging—artificially maintaining etc. trading price

1041D Dissemination of information about illegal transactions

1041E False or misleading statements

1041F Inducing persons to deal

1041G Dishonest conduct

1041H Misleading or deceptive conduct (civil liability only)

1041I Civil action for loss or damage for contravention of sections 1041E to 1041H

1041J Sections of this Division have effect independently of each other

1041K Division applies to certain conduct to the exclusion of State Fair Trading Acts provisions

Division 2A—Proportionate liability for misleading and deceptive conduct

1041L Application of Division

1041M Certain concurrent wrongdoers not to have benefit of apportionment

1041N Proportionate liability for apportionable claims

1041O Defendant to notify plaintiff of concurrent wrongdoer of whom defendant aware

1041P Contribution not recoverable from defendant

1041Q Subsequent actions

1041R Joining non‑party concurrent wrongdoer in the action

1041S Application of Division

Division 3—The insider trading prohibitions

Subdivision A—Preliminary

1042A Definitions

1042B Application of Division

1042C When information is generally available

1042D When a reasonable person would take information to have a material effect on price or value of Division 3 financial products

1042E Division 3 financial products taken to be able to be traded despite suspensions or section 794D directions

1042F Inciting, inducing or encouraging an act or omission constitutes procuring the omission

1042G Information in possession of officer of body corporate

1042H Information in possession of partner or employee of partnership

Subdivision B—The prohibited conduct

1043A Prohibited conduct by person in possession of inside information

1043B Exception for withdrawal from registered scheme

1043C Exception for underwriters

1043D Exception for acquisition pursuant to legal requirement

1043E Exception for information communicated pursuant to a legal requirement

1043F Chinese wall arrangements by bodies corporate

1043G Chinese wall arrangements by partnerships etc.

1043H Exception for knowledge of person’s own intentions or activities

1043I Exception for bodies corporate

1043J Exception for officers or agents of body corporate

1043K Transactions by holder of financial services licence or a representative of the holder of such a licence

1043L A specific situation in which a compensation order under section 1317HA may be made

1043M Defences to prosecution for an offence

1043N Relief from civil liability

1043O Powers of Court

Division 4—Defences, relief and limits on liability

1044A General defence or relief for publishers

1044B Limit on liability for misleading or deceptive conduct

Division 5—Miscellaneous

1045A Exemptions and modifications by regulations

Part 7.11—Title and transfer

Division 1—Title to certain securities

1070A Nature of shares and certain other interests in a company or registered scheme

1070B Numbering of shares

1070C Matters to be specified in share certificate

1070D Loss or destruction of title documents for certain securities

Division 2—Transfer of certain securities

Subdivision A—General provisions

1071A Application of the Subdivision to certain securities

1071B Instrument of transfer

1071C Occupation need not appear in transfer document, register etc.

1071D Registration of transfer at request of transferor

1071E Notice of refusal to register transfer

1071F Remedy for refusal to register transfer or transmission

1071G Certification of transfers

1071H Duties of company with respect to issue of certificates

Subdivision B—Special provisions for shares

1072A Transmission of shares on death (replaceable rule—see section 135)

1072B Transmission of shares on bankruptcy (replaceable rule—see section 135)

1072C Rights of trustee of estate of bankrupt shareholder

1072D Transmission of shares on mental incapacity (replaceable rule—see section 135)

1072E Trustee etc. may be registered as owner of shares

1072F Registration of transfers (replaceable rule—see section 135)

1072G Additional general discretion for directors of proprietary companies to refuse to register transfers (replaceable rule—see section 135)

1072H Notices relating to non‑beneficial and beneficial ownership of shares

Division 3—Transfer of certain securities effected otherwise than through a prescribed CS facility

1073A Application of the Division to certain securities

1073B Definitions

1073C Application of Division to certain bodies as if they were companies

1073D Regulations may govern transfer of certain securities

1073E ASIC may extend regulations to securities not otherwise covered

1073F Operation of this Division and regulations made for its purposes

Division 4—Transfer of financial products effected through prescribed CS facility

1074A Financial products to which this Division applies

1074B Definitions

1074C Operating rules of prescribed CS facility may deal with transfer of title

1074D Valid and effective transfer if operating rules complied with

1074E Regulations may govern transfer of financial products in accordance with operating rules of prescribed CS facility

1074F Issuer protected from civil liability for person’s contravention of prescribed CS facility’s certificate cancellation rules

1074G Operation of this Division and regulations made for its purposes

Division 5—Exemptions and modifications

1075A ASIC’s power to exempt and modify

Part 7.12—Miscellaneous

Division 1—Qualified privilege

1100A Qualified privilege for information given to ASIC

1100B Qualified privilege for the conduct of market licensees and CS facility licensees

1100C Qualified privilege for information given to market licensees and CS facility licensees etc.

1100D Extension of protections given by this Division

Division 2—Other matters

1101A Approved codes of conduct

1101B Power of Court to make certain orders

1101C Preservation and disposal of records etc.

1101D Destruction of records by ASIC

1101E Concealing etc. of books

1101F Falsification of records

1101G Precautions against falsification of records

1101GA How Part 9.3 applies to books required to be kept by this Chapter etc.

1101H Contravention of Chapter does not generally affect validity of transactions etc.

1101I Gaming and wagering laws do not affect validity of contracts relating to financial products

1101J Delegation

Chapter 8—Mutual recognition of securities offers

Part 8.1—Preliminary

1200A Definitions

Part 8.2—Foreign offers that are recognised in this jurisdiction

Division 1—Recognised offers

1200B When an offer is a recognised offer

1200C Conditions that must be met to be a recognised offer

1200D Required documents and information

1200E Warning statement

Division 2—Effect of a recognised offer

1200F Effect of a recognised offer

Division 3—Ongoing conditions for recognised offers

1200G Offering conditions

1200H Address for service condition

1200J Dispute resolution condition

Division 4—Modification of provisions of this Act

1200K Additional operation of section 675 (continuous disclosure)

1200L Pre‑offer advertising

1200M Modification by the regulations

Division 5—ASIC’s powers in relation to recognised offers

1200N Stop orders

1200P Ban on making subsequent recognised offers

1200Q Offence of breaching an ongoing condition

Division 6—Miscellaneous

1200R Service of documents

Part 8.3—Offers made under foreign recognition schemes

1200S Notice to ASIC

1200T Extension of this Act to recognised jurisdictions

1200U ASIC stop order for advertising in a recognised jurisdiction

Chapter 7—Financial services and markets

Part 7.1—Preliminary

Division 1—Object of Chapter and outline of Chapter

760A  Object of Chapter

  The main object of this Chapter is to promote:

 (a) confident and informed decision making by consumers of financial products and services while facilitating efficiency, flexibility and innovation in the provision of those products and services; and

 (b) fairness, honesty and professionalism by those who provide financial services; and

 (c) fair, orderly and transparent markets for financial products; and

 (d) the reduction of systemic risk and the provision of fair and effective services by clearing and settlement facilities.

760B  Outline of Chapter

  An outline of this Chapter is set out in the table below.

Division 2—Definitions

761A  Definitions

  In this Chapter:

able to be traded, in relation to a market, includes (but is not limited to) admitted to quotation on the market.

acquire, in relation to a financial product, has a meaning affected by section 761E.

annual turnover, of a body corporate during a 12‑month period, means the sum of the values of all the supplies that the body corporate, and any body corporate related to the body corporate, have made, or are likely to make, during the 12‑month period, other than:

 (a) supplies made from any of those bodies corporate to any other of those bodies corporate; or

 (b) supplies that are input taxed; or

 (c) supplies that are not for consideration (and are not taxable supplies under section 72‑5 of the A New Tax System (Goods and Services Tax) Act 1999); or

 (d) supplies that are not made in connection with an enterprise that the body corporate carries on; or

 (e) supplies that are not connected with Australia.

Expressions used in this definition that are also used in the A New Tax System (Goods and Services Tax) Act 1999 have the same meaning as in that Act.

arrangement means, subject to section 761B, a contract, agreement, understanding, scheme or other arrangement (as existing from time to time):

 (a) whether formal or informal, or partly formal and partly informal; and

 (b) whether written or oral, or partly written and partly oral; and

 (c) whether or not enforceable, or intended to be enforceable, by legal proceedings and whether or not based on legal or equitable rights.

Australian CS facility licence means a licence under section 824B that authorises a person to operate a clearing and settlement facility.

Australian financial services licence means a licence under section 913B that authorises a person who carries on a financial services business to provide financial services.

Australian market licence means a licence under section 795B that authorises a person to operate a financial market.

authorised representative of a financial services licensee means a person authorised in accordance with section 916A or 916B to provide a financial service or financial services on behalf of the licensee.

basic deposit product means a deposit product that is a facility in relation to which the following conditions are satisfied:

 (a) the terms applicable to the facility (the governing terms) do not permit the amount from time to time standing to the credit of the facility to be reduced otherwise than in consequence of one or more of the following:

 (i) a withdrawal, transfer or debit on the instruction of, or by authority of, the depositor, not being on account of entry fees, exit fees or charges for the management of the funds (but this does not exclude charges for the maintenance of the facility itself);

 (ii) a payment of charges or duties on deposits into, or withdrawals from, the facility that are payable under a law of the Commonwealth or of a State or Territory;

 (iii) a payment that a law of the Commonwealth, or of a State or Territory, requires to be made out of the facility;

 (iv) a payment that an order of a court requires to be made out of the facility;

 (v) the exercise of a right to combine accounts;

 (vi) the correction of an error;

 (vii) any other circumstances specified in regulations made for the purposes of this subparagraph; and

 (b) any return to be generated for the depositor on the amount from time to time standing to the credit of the facility is an amount that is set out in, or that is calculated by reference to a rate or rates that are set out in, the governing terms; and

 (c) either:

 (i) there is no minimum period before which funds cannot be withdrawn or transferred from the facility without a reduction in the return generated for the depositor; or

 (ii) if there is such a period, it expires on or before the end of the period of 5 years starting on the day on which funds were first deposited in the facility; and

 (d) unless subparagraph (c)(ii) applies and the period referred to in that subparagraph expires on or before the end of the period of 2 years starting on the day on which funds were first deposited in the facility—funds are able to be withdrawn or transferred from the facility on the instruction of, or by authority of, the depositor:

 (i) without any prior notice to the ADI that makes the facility available; or

 (ii) if the ADI that makes the facility available is included in a class of ADIs specified in regulations made for the purposes of this subparagraph—subject to a prior notice requirement that does not exceed the period specified in those regulations in relation to that class of ADIs;

  whether or not the withdrawal or transfer will attract a reduction in the return generated for the depositor as mentioned in subparagraph (c)(i); and

 (da) the facility is not an FHSA product; and

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

binder means an authorisation given to a person by a financial services licensee who is an insurer to do either or both of the following:

 (a) enter into contracts that are risk insurance products on behalf of the insurer as insurer; or

 (b) deal with and settle, on behalf of the insurer, claims relating to risk insurance products against the insurer as insurer;

but does not include an authorisation of a kind referred to in paragraph (a) that is limited to effecting contracts of insurance by way of interim cover unless there is also in existence an authority given by the insurer to the person to enter into, on behalf of the insurer and otherwise than by way of interim cover, contracts of insurance.

carried on in this jurisdiction, in relation to a financial services business, has a meaning affected by section 911D.

certificate cancellation provisions, in relation to a prescribed CS facility, means the provisions of the facility’s operating rules that deal with:

 (a) the cancellation of documents of title to financial products transferred through the facility; and

 (b) matters incidental to the cancellation of those documents.

class, in relation to financial products or financial services, has a meaning affected by regulations made for the purposes of section 761CA.

clearing and settlement facility has the meaning given by Division 6.

CS facility licensee means a person who holds an Australian CS facility licence.

current LVR:

 (a) in relation to a standard margin lending facility—has the meaning given by subsection 761EA(3); and

 (b) in relation to a non‑standard margin lending facility—has the meaning given by subsection 761EA(6).

custodial or depository service that a person provides has the meaning given by section 766E.

dealing in a financial product has the meaning given by section 766C (and deal has a corresponding meaning).

deposit product means a financial product described in paragraph 764A(1)(i).

derivative has the meaning given by section 761D.

dispose, in relation to a financial product, includes terminate or close out the legal relationship that constitutes the financial product.

disqualified individual means an individual who is disqualified within the meaning given by section 853A.

employer‑sponsor has the same meaning as in the Superannuation Industry (Supervision) Act 1993.

FHSA product means an FHSA (within the meaning of the First Home Saver Accounts Act 2008).

financial market has the meaning given by Division 5.

financial product has the meaning given by Division 3.

Note: References in this Chapter to financial products have effect subject to particular express exclusions for particular purposes—see e.g. sections 1010A and 1074A.

financial product advice has the meaning given by section 766B.

financial product advice law means:

 (a) a provision of Chapter 7 that covers conduct relating to the provision of financial product advice (whether or not it also covers other conduct), but only in so far as it covers conduct relating to the provision of financial product advice; or

 (b) a provision of Chapter 9 as it applies in relation to a provision referred to in paragraph (a); or

 (c) a provision of Division 2 of Part 2 of the ASIC Act that covers conduct relating to the provision of financial product advice (whether or not it also covers other conduct), but only in so far as it covers conduct relating to the provision of financial product advice; or

 (d) any other Commonwealth, State or Territory legislation that covers conduct relating to the provision of financial product advice (whether or not it also covers other conduct), but only in so far as it covers conduct relating to the provision of financial product advice.

financial service has the meaning given by Division 4.

financial services business means a business of providing financial services.

Note: The meaning of carry on a financial services business is affected by section 761C.

Financial Services Guide means a Financial Services Guide required by section 941A or 941B to be given in accordance with Division 2 of Part 7.7.

financial services law means:

 (a) a provision of this Chapter or of Chapter 5C, 5D, 6, 6A, 6B, 6C or 6D; or

 (b) a provision of Chapter 9 as it applies in relation to a provision referred to in paragraph (a); or

 (c) a provision of Division 2 of Part 2 of the ASIC Act; or

 (d) any other Commonwealth, State or Territory legislation that covers conduct relating to the provision of financial services (whether or not it also covers other conduct), but only in so far as it covers conduct relating to the provision of financial services; or

 (e) in relation to a financial services licensee that is a licensed trustee company (in addition to paragraphs (a) to (d))—any rule of common law or equity that covers conduct relating to the provision of financial services that are traditional trustee company services (whether or not it also covers other conduct), but only in so far as it covers conduct relating to the provision of such services.

financial services licensee means a person who holds an Australian financial services licence.

foreign exchange contract means a contract:

 (a) to buy or sell currency (whether Australian or not); or

 (b) to exchange one currency (whether Australian or not) for another (whether Australian or not).

funeral benefit means a benefit that consists of the provision of funeral, burial or cremation services, with or without the supply of goods connected with such services.

further market‑related advice means advice to which subsection 946B(1) applies.

general advice has the meaning given by subsection 766B(4).

general insurance product means a financial product described in paragraph 764A(1)(d).

holder, in relation to a financial product, means the person to whom the financial product was issued, or if it has (since issue) been disposed of to another person who has not themselves disposed of it, that other person (and hold has a corresponding meaning).

insurance product means a financial product described in paragraph 764A(1)(d), (e) or (f).

investment life insurance product means a financial product described in paragraph 764A(1)(f).

involved in a market licensee or CS facility licensee, or in an applicant for such a licence, has the meaning given by section 853B.

issue, in relation to a financial product, has a meaning affected by section 761E.

issuer, in relation to a financial product, has a meaning affected by section 761E.

kind, in relation to financial products or financial services, has a meaning affected by regulations made for the purposes of section 761CA.

licensed CS facility means a clearing and settlement facility the operation of which is authorised by an Australian CS facility licence.

licensed market means a financial market the operation of which is authorised by an Australian market licence.

licensed trustee company has the same meaning as in Chapter 5D.

life risk insurance product means a financial product described in paragraph 764A(1)(e).

limit, in relation to a margin lending facility, has the meaning given by subsection 761EA(11).

listing rules of a financial market, or proposed financial market, means any rules (however described) that are made by the operator of the market, or contained in the operator’s constitution, and that deal with:

 (a) admitting entities to, or removing entities from, the market’s official list, whether for the purpose of enabling financial products of those entities to be traded on the market or for other purposes; or

 (b) the activities or conduct of entities that are included on that list.

lodge with ASIC, when used in a provision of this Chapter in relation to which regulations made for the purposes of this definition state that the lodgment is to be in a prescribed form, means lodge with ASIC in a prescribed form.

Note: See section 350 for the meaning of lodge in a prescribed form.

makes a market for a financial product has the meaning given by section 766D.

managed investment product means a financial product described in paragraph 764A(1)(b).

margin call:

 (a) in relation to a standard margin lending facility—has the meaning given by subsection 761EA(4); and

 (b) in relation to a non‑standard margin lending facility—has the meaning given by subsection 761EA(7); and

 (c) in relation to a facility that ASIC has declared to be a margin lending facility under subsection 761EA(8)—has the meaning given in the declaration.

margin lending facility has the meaning given by subsection 761EA(1).

market integrity rules means the rules made by ASIC under section 798G.

market licensee means a person who holds an Australian market licence.

non‑standard margin lending facility has the meaning given by subsection 761EA(5).

operated in this jurisdiction:

 (a) in relation to a financial market, has a meaning affected by section 791D; and

 (b) in relation to a clearing and settlement facility, has a meaning affected by section 820D.

operating rules:

 (a) of a clearing and settlement facility, or proposed clearing and settlement facility, means any rules (however described) made by the operator of the facility, or contained in the operator’s constitution, that deal with:

 (i) the activities or conduct of the facility; or

 (ii) the activities or conduct of persons in relation to the facility;

  but does not include any such rules that deal with matters in respect of which licensed CS facilities must have written procedures under regulations made for the purposes of subsection 822A(2); or

 (b) of a financial market, or proposed financial market, means any rules (however described), including the market’s listing rules (if any), that are made by the operator of the market, or contained in the operator’s constitution, and that deal with:

 (i) the activities or conduct of the market; or

 (ii) the activities or conduct of persons in relation to the market;

  but does not include:

 (iii) any such rules that deal with matters in respect of which licensed markets must have written procedures under regulations made for the purposes of subsection 793A(2); or

 (iv) compensation rules within the meaning of Part 7.5.

participant:

 (a) in relation to a clearing and settlement facility, means a person who is allowed to directly participate in the facility under the facility’s operating rules and, when used in any of the following provisions, also includes a recognised affiliate in relation to the facility:

 (i) paragraph 821B(2)(b);

 (ii) section 822B;

 (iii) subsection 915F(2);

 (iv) any other provisions prescribed by regulations made for the purposes of this subparagraph; and

 (b) in relation to a financial market, means a person who is allowed to directly participate in the market under the market’s operating rules and, when used in any of the following provisions, also includes a recognised affiliate in relation to the market:

 (i) paragraph 792B(2)(b);

 (ii) section 793B;

 (iii) section 883A;

 (iv) subsection 915F(2);

 (v) paragraphs 923B(3)(a) and (b);

 (vi) any other provisions prescribed by regulations made for the purposes of this subparagraph.

person has a meaning affected by section 761F (which deals with partnerships) and section 761FA (which deals with multiple trustees).

personal advice has the meaning given by subsection 766B(3).

prescribed CS facility means a licensed CS facility that is prescribed by regulations made for the purposes of this definition.

Product Disclosure Statement means a Product Disclosure Statement:

 (a) required by section 1012A, 1012B, 1012C or 1012I to be given in accordance with Division 2 of Part 7.9; or

 (b) that section 1012H requires an issuer of a financial product to take reasonable steps to ensure is given to a new group member in accordance with Division 2 of Part 7.9.

Note: For the effect of the lodgment of a Replacement Product Disclosure Statement, see section 1014J.

provide, in relation to a financial product, has a meaning affected by section 761E.

recognised affiliate, in relation to a clearing and settlement facility or a financial market, means a person who is:

 (a) recognised by the operating rules of the facility or market as a suitably qualified affiliate of the facility or market; and

 (b) involved in the carrying on of a financial services business (including as an employee, director or in some other capacity).

relevant personal circumstances, in relation to advice provided or to be provided to a person in relation to a matter, are such of the person’s objectives, financial situation and needs as would reasonably be considered to be relevant to the advice.

Replacement Product Disclosure Statement has the meaning given by section 1014H.

retail client has the meaning given by sections 761G and 761GA.

risk insurance product means a financial product described in paragraph 764A(1)(d) or (e).

RSA product means a financial product described in paragraph 764A(1)(h).

security means:

 (a) a share in a body; or

 (b) a debenture of a body; or

 (c) a legal or equitable right or interest in a security covered by paragraph (a) or (b); or

 (d) an option to acquire, by way of issue, a security covered by paragraph (a), (b) or (c); or

 (e) a right (whether existing or future and whether contingent or not) to acquire, by way of issue, the following under a rights issue:

 (i) a security covered by paragraph (a), (b), (c) or (d);

 (ii) an interest or right covered by paragraph 764A(1)(b) or (ba);

but does not include an excluded security. In Part 7.11, it also includes a managed investment product.

self‑managed superannuation fund has the same meaning as in the Superannuation Industry (Supervision) Act 1993.

standard margin lending facility has the meaning given by subsection 761EA(2).

Statement of Advice means a Statement of Advice required by section 946A to be given in accordance with Subdivisions C and D of Division 3 of Part 7.7.

superannuation entity has the same meaning as in the Superannuation Industry (Supervision) Act 1993.

superannuation product means a financial product described in paragraph 764A(1)(g).

Supplementary Financial Services Guide has the meaning given by section 943A.

Supplementary Product Disclosure Statement has the meaning given by section 1014A.

title document, for a financial product, means a certificate or other document evidencing ownership of the financial product.

traditional trustee company services has the same meaning as in Chapter 5D.

trustee company has the same meaning as in Chapter 5D.

wholesale client has the meaning given by section 761G.

761B  Meaning of arrangement—2 or more arrangements that together form a derivative or other financial product

  If:

 (a) an arrangement, when considered by itself, does not constitute a derivative, or some other kind of financial product; and

 (b) that arrangement, and one or more other arrangements, if they had instead been a single arrangement, would have constituted a derivative or other financial product; and

 (c) it is reasonable to assume that the parties to the arrangements regard them as constituting a single scheme;

the arrangements are, for the purposes of this Part, to be treated as if they together constituted a single arrangement.

761C  Meaning of carry on a financial services business

  In working out whether someone carries on a financial services business, Division 3 of Part 1.2 needs to be taken into account. However, paragraph 21(3)(e) does not apply for the purposes of this Chapter.

761CA  Meaning of class and kind of financial products and financial services

  The regulations may include provisions identifying, or providing for the identification of, what constitutes a class or kind of financial products or financial services for the purposes of a provision or provisions of this Chapter.

761D  Meaning of derivative

 (1) For the purposes of this Chapter, subject to subsections (2), (3) and (4), a derivative is an arrangement in relation to which the following conditions are satisfied:

 (a) under the arrangement, a party to the arrangement must, or may be required to, provide at some future time consideration of a particular kind or kinds to someone; and

 (b) that future time is not less than the number of days, prescribed by regulations made for the purposes of this paragraph, after the day on which the arrangement is entered into; and

 (c) the amount of the consideration, or the value of the arrangement, is ultimately determined, derived from or varies by reference to (wholly or in part) the value or amount of something else (of any nature whatsoever and whether or not deliverable), including, for example, one or more of the following:

 (i) an asset;

 (ii) a rate (including an interest rate or exchange rate);

 (iii) an index;

 (iv) a commodity.

 (2) Without limiting subsection (1), anything declared by the regulations to be a derivative for the purposes of this section is a derivative for the purposes of this Chapter. A thing so declared is a derivative despite anything in subsections (3) and (4).

 (3) Subject to subsection (2), the following are not derivatives for the purposes of this Chapter even if they are covered by the definition in subsection (1):

 (a) an arrangement in relation to which subparagraphs (i), (ii) and (iii) are satisfied:

 (i) a party has, or may have, an obligation to buy, and another party has, or may have, an obligation to sell, tangible property (other than Australian or foreign currency) at a price and on a date in the future; and

 (ii) the arrangement does not permit the seller’s obligations to be wholly settled by cash, or by set‑off between the parties, rather than by delivery of the property; and

 (iii) neither usual market practice, nor the rules of a licensed market or a licensed CS facility, permits the seller’s obligations to be closed out by the matching up of the arrangement with another arrangement of the same kind under which the seller has offsetting obligations to buy;

  but only to the extent that the arrangement deals with that purchase and sale;

 (b) a contract for the future provision of services;

 (c) anything that is covered by a paragraph of subsection 764A(1), other than paragraph (c) of that subsection;

 (d) anything declared by the regulations not to be a derivative for the purposes of this Chapter.

 (4) Subject to subsection (2), an arrangement under which one party has an obligation to buy, and the other has an obligation to sell, property is not a derivative for the purposes of this Chapter merely because the arrangement provides for the consideration to be varied by reference to a general inflation index such as the Consumer Price Index.

761E  Meaning of issued, issuer, acquire and provide in relation to financial products

General

 (1) This section defines when a financial product is issued to a person. It also defines who the issuer of a financial product is. If a financial product is issued to a person:

 (a) the person acquires the product from the issuer; and

 (b) the issuer provides the product to the person.

Note: Some financial products can also be acquired from, or provided by, someone other than the issuer (e.g. on secondary trading in financial products).

Issuing a financial product

 (2) Subject to this section, a financial product is issued to a person when it is first issued, granted or otherwise made available to a person.

 (3) Subject to this section, a financial product specified in the table is issued to a person when the event specified for that product occurs:

 (3A) For the avoidance of doubt, none of the following are taken to give rise to the issue of a financial product to a person (the client):

 (a) the client making a further contribution to a superannuation fund of which the client is already a member;

 (aa) an employer of the client making a further contribution, for the benefit of the client, to a superannuation fund of which the client is already a member;

 (b) the client making a further deposit into an RSA maintained in the client’s name;

 (ba) the client making a further contribution (within the meaning of the First Home Saver Accounts Act 2008) into an FHSA product maintained in the client’s name;

 (c) the client making a further payment under a life insurance investment product;

 (d) the client making a further deposit into a deposit product;

 (e) the client engaging in conduct specified in regulations made for the purposes of this paragraph in relation to a financial product already held by the client.

Issuer of a financial product

 (4) Subject to this section, the issuer, in relation to a financial product issued to a person (the client), is the person responsible for the obligations owed, under the terms of the facility that is the product:

 (a) to, or to a person nominated by, the client; or

 (b) if the product has been transferred from the client to another person and is now held by that person or another person to whom it has subsequently been transferred—to, or to a person nominated by, that person or that other person.

Note: For example, the issuer of a direct debit facility is the financial institution with which the account to be debited is held, rather than the persons to whom payments can be made using the facility.

 (5) Subject to subsection (7), each person who is a party to a financial product that:

 (a) is a derivative; and

 (b) is not entered into, or acquired, on a financial market;

is taken to be an issuer of the product.

Note 1: Under paragraph (1)(a), each person who is a party to the derivative will also acquire the financial product at the time of its issue as specified in subsection (3).

Note 2: Although each party to the derivative is an issuer, whether any particular party has disclosure or other obligations under this Chapter will depend on the circumstances (e.g. whether the issue occurs in the course of a business of issuing financial products and whether any of the other parties is a retail client).

 (6) Subject to subsection (7), the issuer of a financial product that:

 (a) is a derivative; and

 (b) is entered into, or acquired, on a financial market;

is taken to be:

 (c) if the product is entered into, or acquired, on the market through an arrangement made by a financial services licensee acting on behalf of another person—the financial services licensee; or

 (d) if the product is entered into, or acquired, on the market through an arrangement made by an authorised representative of a financial services licensee acting on behalf of another person (not being the licensee)—the financial services licensee; or

 (e) if neither paragraph (c) nor (d) applies—the market operator.

 (7) The regulations may make provision determining all or any of the following for the purposes of this Chapter:

 (a) the meaning of issue (and/or related parts of speech, including issuer) in relation to a class of financial products;

 (b) the meaning of acquire (and/or related parts of speech) in relation to a class of financial products;

 (c) the meaning of provide (and/or related parts of speech) in relation to a class of financial products.

Regulations made for the purposes of this subsection have effect despite anything else in this section.

761EA  Meaning of margin lending facility, margin call and associated expressions

 (1) A margin lending facility is:

 (a) a standard margin lending facility; or

 (b) a non‑standard margin lending facility; or

 (c) a facility of a kind that has been declared by ASIC to be a margin lending facility under subsection (8);

unless the facility is of a kind that has been declared by ASIC not to be a margin lending facility under subsection (9).

Standard margin lending facilities

 (2) A standard margin lending facility is a facility under the terms of which:

 (a) credit is, or may be, provided by a person (the provider) to a natural person (the client); and

 (b) the credit provided is, or must be, applied wholly or partly:

 (i) to acquire one or more financial products, or a beneficial interest in one or more financial products; or

 (ii) to repay, wholly or partly, another credit facility (within the meaning of subparagraph 765A(1)(h)(i)), the credit provided under which was applied, wholly or partly, to acquire one or more financial products, or a beneficial interest in one or more financial products; and

 (c) the credit provided is, or must be, secured by property (the secured property); and

 (d) the secured property consists, or must consist, wholly or partly of one or more marketable securities, or a beneficial interest in one or more marketable securities; and

 (e) if the current LVR of the facility exceeds a ratio, percentage, proportion or level (however described) determined under the terms of the facility, then:

 (i) the client becomes required to take action; or

 (ii) the provider becomes entitled to take action; or

 (iii) another person becomes required or entitled to take action;

  in accordance with the terms of the facility to reduce the current LVR of the facility.

 (3) The current LVR of a standard margin lending facility at a particular time is the ratio, percentage, proportion or level (however described) that:

 (a) is determined under the terms of the facility; and

 (b) under the terms of the facility, represents a particular relationship between:

 (i) the amount of the debt owing by the client, or credit provided by the provider, or both, under the facility at that time; and

 (ii) the value of the secured property determined at that time under the terms of the facility.

 (4) A standard margin lending facility is in margin call when paragraph (2)(e) applies in relation to the facility.

Non‑standard margin lending facilities

 (5) A non‑standard margin lending facility is a facility under the terms of which:

 (a) a natural person (the client) transfers one or more marketable securities, or a beneficial interest in one or more marketable securities (the transferred securities) to another person (the provider); and

 (b) the provider transfers property to the client (the transferred property) as consideration or security for the transferred securities; and

 (c) the transferred property is, or must be, applied wholly or partly to acquire one or more financial products, or a beneficial interest in one or more financial products; and

 (d) the client has a right, in the circumstances determined under the terms of the facility, to be given marketable securities equivalent to the transferred securities; and

 (e) if the current LVR of the facility exceeds a ratio, percentage, proportion or level (however described) determined under the terms of the facility, then:

 (i) the client becomes required to take action; or

 (ii) the provider becomes entitled to take action; or

 (iii) another person becomes required or entitled to take action;

  in accordance with the terms of the facility to reduce the current LVR of the facility.

 (6) The current LVR of a non‑standard margin lending facility at a particular time is the ratio, percentage, proportion or level (however described) that:

 (a) is determined under the terms of the facility; and

 (b) under the terms of the facility, represents a particular relationship between:

 (i) an amount determined at that time under the terms of the facility by reference to the value of the transferred property and any amount owing by the client to the provider; and

 (ii) the value of the transferred securities determined at that time under the terms of the facility.

 (7) A non‑standard margin lending facility is in margin call when paragraph (5)(e) applies in relation to the facility.

ASIC declarations in relation to margin lending facilities

 (8) ASIC may declare that a particular kind of facility is a margin lending facility. The declaration must give the meanings of margin call and limit in relation to that kind of facility.

 (9) ASIC may declare that a particular kind of facility is not a margin lending facility.

 (10) A declaration made under subsection (8) or (9):

 (a) must be in writing; and

 (b) is a legislative instrument for the purposes of the Legislative Instruments Act 2003.

Meaning of limit of a margin lending facility

 (11) The limit of a margin lending facility:

 (a) in relation to a standard margin lending facility—means the maximum amount of credit that may be provided by the provider to the client under the facility; and

 (b) in relation to a non‑standard margin lending facility—means the maximum amount of property that may be transferred by the provider to the client under the facility; and

 (c) in relation to a facility of a kind that ASIC has declared to be a margin lending facility under subsection (8)—has the meaning given in the declaration.

761F  Meaning of person—generally includes a partnership

 (1) This Chapter applies to a partnership as if the partnership were a person, but it applies with the following changes:

 (a) obligations that would be imposed on the partnership are imposed instead on each partner, but may be discharged by any of the partners;

 (b) any contravention of a provision of this Chapter, or a provision of this Act that relates to a requirement in a provision of this Chapter, that would otherwise be a contravention by the partnership is taken (whether for the purposes of criminal or civil liability) to have been a contravention by each partner who:

 (i) aided, abetted, counselled or procured the relevant act or omission; or

 (ii) was in any way knowingly concerned in, or party to, the relevant act or omission (whether directly or indirectly and whether by any act or omission of the partner).

 (2) For the purposes of this Chapter, a change in the composition of a partnership does not affect the continuity of the partnership.

 (3) Subsections (1) and (2) have effect subject to:

 (a) an express or implied contrary intention in a provision or provisions of this Chapter; and

 (b) the regulations, which may exclude or modify the effect of those subsections in relation to specified provisions.

761FA  Meaning of person—generally includes multiple trustees

 (1) This section applies in relation to a trust while the trust continues to have:

 (a) 2 or more trustees; or

 (b) a single trustee who was a trustee of the trust at a time when it had 2 or more trustees.

 (2) Subject to subsections (3) and (4), during a period while this section applies to a trust, this Chapter applies to the trust as if the trustee or trustees of the trust from time to time during the period constituted a single legal entity (the notional entity) that remained the same for the duration of that period.

Note: So, for example, while this section applies to a trust, a licence granted under this Chapter to the trustees of the trust will continue in force, despite a change in the persons who are the trustees.

 (3) During any period or part of a period while this section applies to a trust and the trust has 2 or more trustees, this Chapter applies to the trustees as mentioned in subsection (2), but it applies with the following changes:

 (a) obligations that would be imposed on the notional entity are imposed instead on each trustee, but may be discharged by any of the trustees;

 (b) any contravention of a provision of this Chapter, or a provision of this Act that relates to a requirement in a provision of this Chapter, that would otherwise be a contravention by the notional entity is taken (whether for the purposes of criminal or civil liability) to have been a contravention by each trustee who:

 (i) aided, abetted, counselled or procured the relevant act or omission; or

 (ii) was in any way knowingly concerned in, or party to, the relevant act or omission (whether directly or indirectly and whether by any act or omission of the trustee).

 (4) During any period or part of a period while this section applies to a trust and the trust has only one trustee, this Chapter applies to the trustee as mentioned in subsection (2), but it applies with the following changes:

 (a) obligations that would be imposed on the notional entity are imposed instead on that single trustee;

 (b) any contravention of a provision of this Chapter, or a provision of this Act that relates to a requirement in a provision of this Chapter, that would otherwise be a contravention by the notional entity is taken (whether for the purposes of criminal or civil liability) to have been a contravention by that single trustee.

 (5) Subsections (2), (3) and (4) have effect subject to:

 (a) an express or implied contrary intention in a provision or provisions of this Chapter; and

 (b) the regulations, which may exclude or modify the effect of those subsections in relation to specified provisions.

761G  Meaning of retail client and wholesale client

Providing a financial product or financial service to a person as a retail client

 (1) For the purposes of this Chapter, a financial product or a financial service is provided to a person as a retail client unless subsection (5), (6), (6A) or (7), or section 761GA, provides otherwise.

Note: The references in this section to providing a financial product to a person are not to be taken to imply that the provision of a financial product is not also the provision of a financial service (see the meaning of dealing in section 766C).

Acquiring a financial product or financial service as a retail client

 (2) For the purposes of this Chapter, a person to whom a financial product or financial service is provided as a retail client is taken to acquire the product or service as a retail client.

Disposing of a financial product as a retail client

 (3) If a financial product is provided to a person as a retail client, any subsequent disposal of all or part of that product by the person is, for the purposes of this Chapter, a disposal by the person as a retail client.

Wholesale clients

 (4) For the purposes of this Chapter, a financial product or a financial service is provided to, or acquired by, a person as a wholesale client if it is not provided to, or acquired by, the person as a retail client.

General insurance products

 (5) For the purposes of this Chapter, if a financial product is, or a financial service provided to a person relates to, a general insurance product, the product or service is provided to the person as a retail client if:

 (a) either:

 (i) the person is an individual; or

 (ii) the insurance product is or would be for use in connection with a small business (see subsection (12)); and

 (b) the general insurance product is:

 (i) a motor vehicle insurance product (as defined in the regulations); or

 (ii) a home building insurance product (as defined in the regulations); or

 (iii) a home contents insurance product (as defined in the regulations); or

 (iv) a sickness and accident insurance product (as defined in the regulations); or

 (v) a consumer credit insurance product (as defined in the regulations); or

 (vi) a travel insurance product (as defined in the regulations); or

 (vii) a personal and domestic property insurance product (as defined in the regulations); or

 (viii) a kind of general insurance product prescribed by regulations made for the purposes of this subparagraph.

In any other cases, the provision to a person of a financial product that is, or a financial service that relates to, a general insurance product does not constitute the provision of a financial product or financial service to the person as a retail client.

Superannuation products and RSA products

 (6) For the purposes of this Chapter:

 (a) if a financial product provided to a person is a superannuation product or an RSA product, the product is provided to the person as a retail client; and

 (aa) however, if a trustee of a pooled superannuation trust (within the meaning of the Superannuation Industry (Supervision) Act 1993) provides a financial product that is an interest in the trust to a person covered by subparagraph (c)(i), the product is not provided to the person as a retail client; and

 (b) if a financial service (other than the provision of a financial product) provided to a person who is not covered by subparagraph (c)(i) or (ii) relates to a superannuation product or an RSA product, the service is provided to the person as a retail client; and

 (c) if a financial service (other than the provision of a financial product) provided to a person who is:

 (i) the trustee of a superannuation fund, an approved deposit fund, a pooled superannuation trust or a public sector superannuation scheme (within the meaning of the Superannuation Industry (Supervision) Act 1993) that has net assets of at least $10 million; or

 (ii) an RSA provider (within the meaning of the Retirement Savings Accounts Act 1997);

  relates to a superannuation product or an RSA product, that does not constitute the provision of a financial service to the person as a retail client.

Traditional trustee company services

 (6A) For the purpose of this Chapter, if a financial service provided to a person is a traditional trustee company service, the service is provided to the person as a retail client unless regulations made for the purpose of this subsection provide otherwise.

Other kinds of financial product

 (7) For the purposes of this Chapter, if a financial product is not, or a financial service (other than a traditional trustee company service) provided to a person does not relate to, a general insurance product, a superannuation product or an RSA product, the product or service is provided to the person as a retail client unless one or more of the following paragraphs apply:

 (a) the price for the provision of the financial product, or the value of the financial product to which the financial service relates, equals or exceeds the amount specified in regulations made for the purposes of this paragraph as being applicable in the circumstances (but see also subsection (10)); or

 (b) the financial product, or the financial service, is provided for use in connection with a business that is not a small business (see subsection (12));

 (c) the financial product, or the financial service, is not provided for use in connection with a business, and the person who acquires the product or service gives the provider of the product or service, before the provision of the product or service, a copy of a certificate given within the preceding 6 months by a qualified accountant (as defined in section 9) that states that the person:

 (i) has net assets of at least the amount specified in regulations made for the purposes of this subparagraph; or

 (ii) has a gross income for each of the last 2 financial years of at least the amount specified in regulations made for the purposes of this subparagraph a year;

 (d) the person is a professional investor.

Offence proceedings—defendant bears evidential burden in relation to matters referred to in paragraphs (7)(a) to (d)

 (8) In a prosecution for an offence based on a provision of this Chapter, a defendant bears an evidential burden in relation to the matters in paragraphs (7)(a) to (d) as if those matters were exceptions for the purposes of subsection 13.3(3) of the Criminal Code.

Other proceedings relating to subsection (7) products—presumption in non‑criminal proceedings of retail client unless contrary established

 (9) If:

 (a) it is alleged in a proceeding under this Chapter (not being a prosecution for an offence), or in any other proceeding (not being a prosecution for an offence) in respect of a matter arising under this Chapter, that a particular financial product or financial service was provided to a person as a retail client; and

 (b) the product or the service is one to which subsection (7) applies;

it is presumed that the product or service was provided to the person as a retail client unless the contrary is established.

Note 1: There is no such presumption in relation to the provision of a product or service that is or relates to a general insurance product, a superannuation product or an RSA product. Whether or not such a product, or a service relating to such a product, was provided to a person as a retail client is to be resolved as provided in subsection (5) or (6), as the case requires.

Note 2: In criminal proceedings, a defendant bears an evidential burden in relation to the matters in paragraphs (7)(a) to (d) (see subsection (8)).

Regulations and paragraph (7)(a)

 (10) In addition to specifying an amount or amounts for the purposes of paragraph (7)(a), the regulations may do either or both of the following:

 (a) deal with how a price or value referred to in that paragraph is to be calculated, either generally or in relation to a specified class of financial products;

 (b) modify the way in which that paragraph applies in particular circumstances.

Regulations and paragraph (7)(c)

 (10A) In addition to specifying amounts for the purposes of subparagraphs (7)(c)(i) and (ii), the regulations may do either or both of the following:

 (a) deal with how net assets referred to in subparagraph (7)(c)(i) are to be determined and valued, either generally or in specified circumstances;

 (b) deal with how gross income referred to in subparagraph (7)(c)(ii) is to be calculated, either generally or in specified circumstances.

What happens if a package of general insurance products and other kinds of financial products is provided?

 (11) If:

 (a) either:

 (i) in a single transaction, 2 or more financial products are provided to a person; or

 (ii) a single financial service provided to a person relates to 2 or more financial products; and

 (b) one or more, but not all, of the financial products are general insurance products;

subsection (5) applies to the transaction or service so far as it relates to the general insurance products, and subsection (6) or (7), as the case requires, applies to the transaction or service so far as it relates to other financial products.

Definition

 (12) In this section:

small business means a business employing less than:

 (a) if the business is or includes the manufacture of goods—100 people; or

 (b) otherwise—20 people.

761GA  Meaning of retail client—sophisticated investors

  For the purposes of this Chapter, a financial product, or a financial service (other than a traditional trustee company service) in relation to a financial product, is not provided by one person to another person as a retail client if:

 (a) the first person (the licensee) is a financial services licensee; and

 (b) the financial product is not a general insurance product, a superannuation product or an RSA product; and

 (c) the financial product or service is not provided for use in connection with a business; and

 (d) the licensee is satisfied on reasonable grounds that the other person (the client) has previous experience in using financial services and investing in financial products that allows the client to assess:

 (i) the merits of the product or service; and

 (ii) the value of the product or service; and

 (iii) the risks associated with holding the product; and

 (iv) the client’s own information needs; and

 (v) the adequacy of the information given by the licensee and the product issuer; and

 (e) the licensee gives the client before, or at the time when, the product or advice is provided a written statement of the licensee’s reasons for being satisfied as to those matters; and

 (f) the client signs a written acknowledgment before, or at the time when, the product or service is provided that:

 (i) the licensee has not given the client a Product Disclosure Statement; and

 (ii) the licensee has not given the client any other document that would be required to be given to the client under this Chapter if the product or service were provided to the client as a retail client; and

 (iii) the licensee does not have any other obligation to the client under this Chapter that the licensee would have if the product or service were provided to the client as a retail client.

761H  References to this Chapter include references to regulations or other instruments made for the purposes of this Chapter

 (1) A reference in a provision of this Chapter to this Chapter, or to a particular provision or group of provisions of this Chapter, includes (unless a contrary intention appears) a reference to regulations, or other instruments, made for the purposes of this Chapter, or for the purposes of that provision or any of those provisions, as the case requires.

 (2) Subsection (1) has effect as if provisions in Part 10.2 (transitional provisions) that relate to matters dealt with in this Chapter were part of this Chapter.

Division 3—What is a financial product?

Subdivision A—Preliminary

762A  Overview of approach to defining what a financial product is

General definition

 (1) Subdivision B sets out a general definition of financial product. Subject to subsections (2) and (3), a facility is a financial product if it falls within that definition.

Specific inclusions

 (2) Subdivision C identifies, or provides for the identification of, kinds of facilities that, subject to subsection (3), are financial products (whether or not they are within the general definition).

Overriding exclusions

 (3) Subdivision D identifies, or provides for the identification of, kinds of facilities that are not financial products. These facilities are not financial products:

 (a) even if they are within the general definition; and

 (b) even if they are within a class of facilities identified as mentioned in subsection (2).

762B  What if a financial product is part of a broader facility?

  If a financial product is a component of a facility that also has other components, this Chapter, in applying to the financial product, only applies in relation to the facility to the extent it consists of the component that is the financial product.

Note: So, e.g., Part 7.9 does not require disclosures to be made in relation to those other components.

762C  Meaning of facility

  In this Division:

facility includes:

 (a) intangible property; or

 (b) an arrangement or a term of an arrangement (including a term that is implied by law or that is required by law to be included); or

 (c) a combination of intangible property and an arrangement or term of an arrangement.

Note: 2 or more arrangements may be taken to constitute a single arrangement—see section 761B.

Subdivision B—The general definition

763A  General definition of financial product

 (1) For the purposes of this Chapter, a financial product is a facility through which, or through the acquisition of which, a person does one or more of the following:

 (a) makes a financial investment (see section 763B);

 (b) manages financial risk (see section 763C);

 (c) makes non‑cash payments (see section 763D).

This has effect subject to section 763E.

 (2) For the purposes of this Chapter, a particular facility that is of a kind through which people commonly make financial investments, manage financial risks or make non‑cash payments is a financial product even if that facility is acquired by a particular person for some other purpose.

 (3) A facility does not cease to be a financial product merely because:

 (a) the facility has been acquired by a person other than the person to whom it was originally issued; and

 (b) that person, in acquiring the product, was not making a financial investment or managing a financial risk.

763B  When a person makes a financial investment

  For the purposes of this Chapter, a person (the investor) makes a financial investment if:

 (a) the investor gives money or money’s worth (the contribution) to another person and any of the following apply:

 (i) the other person uses the contribution to generate a financial return, or other benefit, for the investor;

 (ii) the investor intends that the other person will use the contribution to generate a financial return, or other benefit, for the investor (even if no return or benefit is in fact generated);

 (iii) the other person intends that the contribution will be used to generate a financial return, or other benefit, for the investor (even if no return or benefit is in fact generated); and

 (b) the investor has no day‑to‑day control over the use of the contribution to generate the return or benefit.

Note 1: Examples of actions that constitute making a financial investment under this subsection are:

(a) a person paying money to a company for the issue to the person of shares in the company (the company uses the money to generate dividends for the person and the person, as a shareholder, does not have control over the day‑to‑day affairs of the company); or

(b) a person contributing money to acquire interests in a registered scheme from the responsible entity of the scheme (the scheme uses the money to generate financial or other benefits for the person and the person, as a member of the scheme, does not have day‑to‑day control over the operation of the scheme).

Note 2: Examples of actions that do not constitute making a financial investment under this subsection are:

(a) a person purchasing real property or bullion (while the property or bullion may generate a return for the person, it is not a return generated by the use of the purchase money by another person); or

(b) a person giving money to a financial services licensee who is to use it to purchase shares for the person (while the purchase of the shares will be a financial investment made by the person, the mere act of giving the money to the licensee will not of itself constitute making a financial investment).

763C  When a person manages financial risk

  For the purposes of this Chapter, a person manages financial risk if they:

 (a) manage the financial consequences to them of particular circumstances happening; or

 (b) avoid or limit the financial consequences of fluctuations in, or in the value of, receipts or costs (including prices and interest rates).

Note 1: Examples of actions that constitute managing a financial risk are:

(a) taking out insurance; or

(b) hedging a liability by acquiring a futures contract or entering into a currency swap.

Note 2: An example of an action that does not constitute managing a financial risk is employing a security firm (while that is a way of managing the risk that thefts will happen, it is not a way of managing the financial consequences if thefts do occur).

763D  When a person makes non‑cash payments

 (1) For the purposes of this Chapter, a person makes non‑cash payments if they make payments, or cause payments to be made, otherwise than by the physical delivery of Australian or foreign currency in the form of notes and/or coins.

Note: Examples of actions that constitute making non‑cash payments are:

(a) making payments by means of a facility for direct debit of a deposit account; or

(b) making payments by means of a facility for the use of cheques; or

(c) making payments by means of a purchased payment facility within the meaning of the Payment Systems (Regulation) Act 1998, such as a smart card; or

(d) making payments by means of traveller’s cheques (whether denominated in Australian or foreign currency).

 (2) For the purposes of this Chapter, the following are not making non‑cash payments, even if they might otherwise be covered by subsection (1):

 (a) making payments by means of a facility in relation to which one of the following applies:

 (i) there is only one person to whom payments can be made by means of the facility;

 (ii) the facility is, or is of a kind, specified in the regulations as being a facility that is not to be covered by this section because of restrictions relating to the number of people to whom payments can be made by means of the facility, or relating to the number of persons who can use the facility to make payments;

 (b) making payments by means of:

 (i) a letter of credit from a financial institution; or

 (ii) a cheque drawn by a financial institution on itself; or

 (iii) a guarantee given by a financial institution.

763E  What if a financial product is only incidental?

 (1) If:

 (a) something (the incidental product) that, but for this section, would be a financial product because of this Subdivision is:

 (i) an incidental component of a facility that also has other components; or

 (ii) a facility that is incidental to one or more other facilities; and

 (b) it is reasonable to assume that the main purpose of:

 (i) if subparagraph (a)(i) applies—the facility referred to in that subparagraph, when considered as a whole; or

 (ii) if subparagraph (a)(ii) applies—the incidental product, and the other facilities referred to in that subparagraph, when considered as a whole;

  is not a financial product purpose;

the incidental product is not a financial product because of this Subdivision (however, it may still be a financial product because of Subdivision C).

 (2) In this section:

financial product purpose means a purpose of:

 (a) making a financial investment; or

 (b) managing financial risk; or

 (c) making non‑cash payments.

Subdivision C—Specific inclusions

764A  Specific things that are financial products (subject to Subdivision D)

 (1) Subject to Subdivision D, the following are financial products for the purposes of this Chapter:

 (a) a security;

 (b) any of the following in relation to a registered scheme:

 (i) an interest in the scheme;

 (ii) a legal or equitable right or interest in an interest covered by subparagraph (i);

 (iii) an option to acquire, by way of issue, an interest or right covered by subparagraph (i) or (ii);

 (ba) any of the following in relation to a managed investment scheme that is not a registered scheme, other than a scheme (whether or not operated in this jurisdiction) in relation to which none of paragraphs 601ED(1)(a), (b) and (c) are satisfied:

 (i) an interest in the scheme;

 (ii) a legal or equitable right or interest in an interest covered by subparagraph (i);

 (iii) an option to acquire, by way of issue, an interest or right covered by subparagraph (i) or (ii);

 (c) a derivative;

 (d) a contract of insurance that is not a life policy, or a sinking fund policy, within the meaning of the Life Insurance Act 1995, but not including such a contract of insurance:

 (i) to the extent that it provides for a benefit to be provided by an association of employees that is registered as an organisation, or recognised, under the Fair Work (Registered Organisations) Act 2009 for a member of the association or a dependant of a member; or

 (ii) to the extent that it provides for benefits, pensions or payments described in paragraph 11(3)(c) of the Life Insurance Act 1995; or

 (iii) to the extent that it provides for the provision of a funeral benefit; or

 (iv) issued by an employer to an employee of the employer;

 (e) a life policy, or a sinking fund policy, within the meaning of the Life Insurance Act 1995, that is a contract of insurance, but not including such a policy:

 (i) to the extent that it provides for a benefit to be provided by an association of employees that is registered as an organisation, or recognised, under the Fair Work (Registered Organisations) Act 2009 for a member of the association or a dependant of a member; or

 (ii) to the extent that it provides for benefits, pensions or payments described in paragraph 11(3)(c) of the Life Insurance Act 1995; or

 (iii) to the extent that it provides for the provision of a funeral benefit; or

 (iv) issued by an employer to an employee of the employer;

 (f) a life policy, or a sinking fund policy, within the meaning of the Life Insurance Act 1995, that is not a contract of insurance, but not including such a policy:

 (i) to the extent that it provides for a benefit to be provided by an association of employees that is registered as an organisation, or recognised, under the Fair Work (Registered Organisations) Act 2009 for a member of the association or a dependant of a member; or

 (ii) to the extent that it provides for benefits, pensions or payments described in paragraph 11(3)(c) of the Life Insurance Act 1995; or

 (iii) to the extent that it provides for the provision of a funeral benefit; or

 (iv) issued by an employer to an employee of the employer;

 (g) a superannuation interest within the meaning of the Superannuation Industry (Supervision) Act 1993;

 (h) an RSA (retirement savings account) within the meaning of the Retirement Savings Accounts Act 1997;

 (ha) an FHSA (short for first home saver account) within the meaning of the First Home Saver Accounts Act 2008;

 (i) any deposit‑taking facility made available by an ADI (within the meaning of the Banking Act 1959) in the course of its banking business (within the meaning of that Act), other than an RSA (RSAs are covered by paragraph (h));

 (j) a debenture, stock or bond issued or proposed to be issued by a government;

 (k) a foreign exchange contract that is not:

 (i) a derivative (derivatives are covered by paragraph (c)); or

 (ii) a contract to exchange one currency (whether Australian or not) for another that is to be settled immediately;

 (ka) an Australian carbon credit unit;

 (kb) an eligible international emissions unit;

 (l) a margin lending facility;

 (m) anything declared by the regulations to be a financial product for the purposes of this section.

Note: Even though something is expressly excluded from one of these paragraphs, it may still be a financial product (subject to Subdivision D) either because:

(a) it is covered by another of these paragraphs; or

(b) it is covered by the general definition in Subdivision B.

 (1A) If a single contract of insurance provides 2 or more kinds of cover, paragraph (1)(d) applies separately in relation to that contract, in relation to each of those kinds of cover, as if the contract only provided that kind of cover.

Note: Because of this subsection (including as it is affected by subsection (1B)), a single contract of insurance may constitute 2 or more separate general insurance products.

 (1B) If a contract of insurance provides a kind of cover in relation to 2 or more kinds of asset, subsection (1A) applies to the contract, in relation to each of those kinds of asset, as if the cover provided by the contract in relation to that kind of asset constituted a separate kind of cover.

 (2) For the purpose of paragraphs (1)(d), (e) and (f) and subsections (1A) and (1B), contract of insurance includes:

 (a) a contract that would ordinarily be regarded as a contract of insurance even if some of its provisions are not by way of insurance; and

 (b) a contract that includes provisions of insurance in so far as those provisions are concerned, even if the contract would not ordinarily be regarded as a contract of insurance.

Subdivision D—Specific exclusions

765A  Specific things that are not financial products

 (1) Despite anything in Subdivision B or Subdivision C, the following are not financial products for the purposes of this Chapter:

 (a) an excluded security;

 (b) an undertaking by a body corporate to pay money to a related body corporate;

 (c) health insurance provided as part of a health insurance business (as defined in Division 121 of the Private Health Insurance Act 2007);

 (ca) insurance provided as part of a health‑related business (as defined by section 131‑15 of that Act) that is conducted through a health benefits fund (as defined by section 131‑10 of that Act);

 (d) insurance provided by the Commonwealth;

 (e) State insurance or Northern Territory insurance, including insurance entered into by:

 (i) a State or the Northern Territory; and

 (ii) some other insurer;

  as joint insurers;

 (f) insurance entered into by the Export Finance and Insurance Corporation, other than a short‑term insurance contract within the meaning of the Export Finance and Insurance Corporation Act 1991;

 (g) reinsurance;

 (h) any of the following:

 (i) a credit facility within the meaning of the regulations (other than a margin lending facility);

 (ii) a facility for making non‑cash payments (see section 763D), if payments made using the facility will all be debited to a credit facility covered by subparagraph (i);

 (i) a facility:

 (i) that is an approved RTGS system within the meaning of the Payment Systems and Netting Act 1998; or

 (ii) for the transmission and reconciliation of non‑cash payments (see section 763D), and the establishment of final positions, for settlement through an approved RTGS system within the meaning of the Payment Systems and Netting Act 1998;

 (j) a facility that is a designated payment system for the purposes of the Payment Systems (Regulation) Act 1998;

 (k) a facility for the exchange and settlement of non‑cash payments (see section 763D) between providers of non‑cash payment facilities;

 (l) a facility that is:

 (i) a financial market; or

 (ii) a clearing and settlement facility; or

 (iii) a payment system operated as part of a clearing and settlement facility;

 (m) a contract to exchange one currency (whether Australian or not) for another that is to be settled immediately;

 (n) so much of an arrangement as is not a derivative because of paragraph 761D(3)(a);

 (p) an arrangement that is not a derivative because of subsection 761D(4);

 (q) an interest in a superannuation fund of a kind prescribed by regulations made for the purposes of this paragraph;

 (r) any of the following:

 (i) an interest in something that is not a managed investment scheme because of paragraph (c), (e), (f), (k), (l) or (m) of the definition of managed investment scheme in section 9;

 (ii) a legal or equitable right or interest in an interest covered by subparagraph (i);

 (iii) an option to acquire, by way of issue, an interest or right covered by subparagraph (i) or (ii);

 (s) any of the following in relation to a managed investment scheme (whether or not operated in this jurisdiction) in relation to which none of paragraphs 601ED(1)(a), (b) and (c) are satisfied and that is not a registered scheme:

 (i) an interest in the scheme;

 (ii) a legal or equitable right or interest in an interest covered by subparagraph (i);

 (iii) an option to acquire, by way of issue, an interest or right covered by subparagraph (i) or (ii);

 (t) a deposit‑taking facility that is, or is used for, State banking;

 (u) a benefit provided by an association of employees that is registered as an organisation, or recognised, under the Fair Work (Registered Organisations) Act 2009 for a member of the association or a dependant of a member;

 (v) either of the following:

 (i) a contract of insurance; or

 (ii) a life policy or a sinking fund policy, within the meaning of the Life Insurance Act 1995, that is not a contract of insurance;

  issued by an employer to an employee of the employer;

 (w) a funeral benefit;

 (x) physical equipment or physical infrastructure by which something else that is a financial product is provided;

 (y) a facility, interest or other thing declared by regulations made for the purposes of this subsection not to be a financial product;

 (z) a facility, interest or other thing declared by ASIC under subsection (2) not to be a financial product.

 (2) ASIC may declare that a specified facility, interest or other thing is not a financial product for the purposes of this Chapter. The declaration must be in writing and ASIC must publish notice of it in the Gazette.

Division 4—When does a person provide a financial service?

766A  When does a person provide a financial service?

General

 (1) For the purposes of this Chapter, subject to paragraph (2)(b), a person provides a financial service if they:

 (a) provide financial product advice (see section 766B); or

 (b) deal in a financial product (see section 766C); or

 (c) make a market for a financial product (see section 766D); or

 (d) operate a registered scheme; or

 (e) provide a custodial or depository service (see section 766E); or

 (f) engage in conduct of a kind prescribed by regulations made for the purposes of this paragraph.

Provision of traditional trustee company services by trustee company

 (1A) Subject to paragraph (2)(b), the provision by a trustee company of a traditional trustee company service constitutes the provision, by the company, of a financial service.

Note: Trustee companies may also provide other kinds of financial service mentioned in subsection (1).

 (1B) The regulations may, in relation to a traditional trustee company service of a particular class, prescribe the person or persons to whom a service of that class is taken to be provided. This subsection does not limit (and is not limited by) subsection (2).

Note: A traditional trustee company service is provided to a person as a retail client unless regulations provide otherwise (see subsection 761G(6A)).

Regulations may deal with various matters

 (2) The regulations may set out:

 (a) the circumstances in which persons facilitating the provision of a financial service (for example, by publishing information) are taken also to provide that service; or

 (b) the circumstances in which persons are taken to provide, or are taken not to provide, a financial service.

Exception for work ordinarily done by clerks or cashiers

 (3) To avoid doubt, a person’s conduct is not the provision of a financial service if it is done in the course of work of a kind ordinarily done by clerks or cashiers.

Meaning of operating a registered scheme

 (4) For the purposes of this section, a person is not operating a registered scheme merely because:

 (a) they are acting as an agent or employee of another person; or

 (b) they are taking steps to wind up the scheme.

766B  Meaning of financial product advice

 (1) For the purposes of this Chapter, financial product advice means a recommendation or a statement of opinion, or a report of either of those things, that:

 (a) is intended to influence a person or persons in making a decision in relation to a particular financial product or class of financial products, or an interest in a particular financial product or class of financial products; or

 (b) could reasonably be regarded as being intended to have such an influence.

 (1A) However, subject to subsection (1B), the provision or giving of an exempt document or statement does not constitute the provision of financial product advice.

 (1B) Subsection (1A) does not apply for the purpose of determining whether a recommendation or statement of opinion made by an outside expert, or a report of such a recommendation or statement of opinion, that is included in an exempt document or statement is financial product advice provided by the outside expert.

 (2) There are 2 types of financial product advice: personal advice and general advice.

 (3) For the purposes of this Chapter, personal advice is financial product advice that is given or directed to a person (including by electronic means) in circumstances where:

 (a) the provider of the advice has considered one or more of the person’s objectives, financial situation and needs (otherwise than for the purposes of compliance with the Anti‑Money Laundering and Counter‑Terrorism Financing Act 2006 or with regulations, or AML/CTF Rules, under that Act); or

 (b) a reasonable person might expect the provider to have considered one or more of those matters.

 (4) For the purposes of this Chapter, general advice is financial product advice that is not personal advice.

 (5) The following advice is not financial product advice:

 (a) advice given by a lawyer in his or her professional capacity, about matters of law, legal interpretation or the application of the law to any facts;

 (b) except as may be prescribed by the regulations—any other advice given by a lawyer in the ordinary course of activities as a lawyer, that is reasonably regarded as a necessary part of those activities;

 (c) except as may be prescribed by the regulations—advice given by a registered tax agent or BAS agent (within the meaning of the Tax Agent Services Act 2009), that is given in the ordinary course of activities as such an agent and that is reasonably regarded as a necessary part of those activities.

 (6) If:

 (a) in response to a request made by a person (the inquirer) to another person (the provider), the provider tells the inquirer the cost, or an estimate of the likely cost, of a financial product (for example, an insurance product); and

 (b) that cost or estimate is worked out, or said by the provider to be worked out, by reference to a valuation of an item (for example, a house or car to which an insurance policy would relate), being a valuation that the provider suggests or recommends to the inquirer;

the acts of telling the inquirer the cost, or estimated cost, and suggesting or recommending the valuation, do not, of themselves, constitute the making of a recommendation (or the provision of any other kind of financial product advice) relating to the financial product.

 (7) If:

 (a) in response to a request made by a person (the inquirer) to another person (the provider), the provider tells the inquirer information about:

 (i) the cost of a financial product; or

 (ii) the rate of return on a financial product; or

 (iii) any other matter identified in regulations made for the purposes of this subparagraph; and

 (b) the request could also have been complied with (but was not also so complied with) by telling the inquirer equivalent information about one or more other financial products;

the act of telling the inquirer the information does not, of itself, constitute the making of a recommendation (or the provision of any other kind of financial product advice) in relation to the financial product referred to in paragraph (a).

 (8) Subsections (5), (6) and (7) are not intended to affect, in any way, the determination of whether situations not covered by those subsections do, or do not, constitute the provision of financial product advice.

 (9) In this section:

exempt document or statement means:

 (a) a document prepared, or a statement given, in accordance with requirements of this Chapter, other than:

 (i) a Statement of Advice; or

 (ii) a document or statement of a kind prescribed by regulations made for the purposes of this subparagraph; or

 (b) any other document or statement of a kind prescribed by regulations made for the purposes of this paragraph.

outside expert, in relation to an exempt document or statement, means an expert who is not:

 (a) the person by whom, or on whose behalf, the exempt document or statement was prepared; or

 (b) an employee or director of that person.

766C  Meaning of dealing

 (1) For the purposes of this Chapter, the following conduct (whether engaged in as principal or agent) constitutes dealing in a financial product:

 (a) applying for or acquiring a financial product;

 (b) issuing a financial product;

 (c) in relation to securities or managed investment interests—underwriting the securities or interests;

 (d) varying a financial product;

 (e) disposing of a financial product.

 (2) Arranging for a person to engage in conduct referred to in subsection (1) is also dealing in a financial product, unless the actions concerned amount to providing financial product advice.

 (3) A person is taken not to deal in a financial product if the person deals in the product on their own behalf (whether directly or through an agent or other representative), unless:

 (a) the person is an issuer of financial products; and

 (b) the dealing is in relation to one or more of those products.

 (3A) For the purposes of subsection (3), a person (the agent) who deals in a product as an agent or representative of another person (the principal) is not taken to deal in the product on the agent’s own behalf, even if that dealing, when considered as a dealing by the principal, is a dealing by the principal on the principal’s own behalf.

 (4) Also, a transaction entered into by a person who is, or who encompasses or constitutes in whole or in part, any of the following entities:

 (a) a government or local government authority;

 (b) a public authority or instrumentality or agency of the Crown;

 (c) a body corporate or an unincorporated body;

is taken not to be dealing in a financial product by that person if the transaction relates only to:

 (d) securities of that entity; or

 (e) if the entity is a government—debentures, stocks or bonds issued or proposed to be issued by that government.

 (5) Paragraph (4)(c) does not apply if the entity:

 (a) carries on a business of investment in securities, interests in land or other investments; and

 (b) in the course of carrying on that business, invests funds subscribed, whether directly or indirectly, after an offer or invitation to the public (within the meaning of section 82) made on terms that the funds subscribed would be invested.

 (6) A transaction entered into by a sub‑underwriter of an issue of securities that relates only to the sub‑underwriting is taken not to be dealing in a financial product.

 (7) The regulations may prescribe conduct that is taken to be, or not to be, dealing in a financial product. Regulations made for the purposes of this subsection have effect despite anything else in this section.

766D  Meaning of makes a market for a financial product

 (1) For the purposes of this Chapter, a person makes a market for a financial product if:

 (a) either through a facility, at a place or otherwise, the person regularly states the prices at which they propose to acquire or dispose of financial products on their own behalf; and

 (b) other persons have a reasonable expectation that they will be able to regularly effect transactions at the stated prices; and

 (c) the actions of the person do not, or would not if they happened through a facility or at a place, constitute operating a financial market because of the effect of paragraph 767A(2)(a).

 (2) Paragraph (1)(a) does not apply to a person stating prices at which they propose to acquire or dispose of financial products if:

 (a) the person is the issuer of the products; and

 (b) the products are superannuation products, managed investment products or financial products referred to in paragraph 764A(1)(ba) (which relates to unregistered managed investment schemes).

766E  Meaning of provide a custodial or depository service

 (1) For the purposes of this Chapter, a person (the provider) provides a custodial or depository service to another person (the client) if, under an arrangement between the provider and the client, or between the provider and another person with whom the client has an arrangement, (whether or not there are also other parties to any such arrangement), a financial product, or a beneficial interest in a financial product, is held by the provider in trust for, or on behalf of, the client or another person nominated by the client.

 (2) The following provisions apply in relation to a custodial or depository service:

 (a) subject to paragraph (b), for the purposes of this Chapter, the time at which a custodial or depository service is provided is the time when the financial product or beneficial interest concerned is first held by the provider as mentioned in subsection (1);

 (b) for the purposes of Part 7.6, and of any other provisions of this Act prescribed by regulations made for the purposes of this paragraph, the continued holding of the financial product or beneficial interest concerned by the provider as mentioned in subsection (1) also constitutes the provision of a custodial or depository service.

Note: Because of paragraph (a) (subject to regulations made for the purposes of paragraph (b)), the requirements of Part 7.7 relating to financial services disclosure need only be complied with before the product or interest is first held by the provider. However, because of paragraph (b), the provider will be subject to the licensing and related requirements of Part 7.6 for so long as they continue to hold the product or interest.

 (3) However, the following conduct does not constitute providing a custodial or depository service:

 (a) the operation of a clearing and settlement facility;

 (b) the operation of a registered scheme, or the holding of the assets of a registered scheme;

 (c) the operation of a regulated superannuation fund, an approved deposit fund or a pooled superannuation trust (within the meaning of the Superannuation Industry (Supervision) Act 1993) by the trustees of that fund or trust;

 (ca) the operation of a statutory fund by a life company (within the meaning of the Life Insurance Act 1995);

 (cb) the operation of an FHSA trust (within the meaning of the First Home Saver Accounts Act 2008) by an FHSA provider (within the meaning of that Act);

 (d) the provision of services to a related body corporate;

 (e) any other conduct of a kind prescribed by regulations made for the purposes of this paragraph.

Division 5—What is a financial market?

767A  What is a financial market?

 (1) For the purposes of this Chapter, a financial market is a facility through which:

 (a) offers to acquire or dispose of financial products are regularly made or accepted; or

 (b) offers or invitations are regularly made to acquire or dispose of financial products that are intended to result or may reasonably be expected to result, directly or indirectly, in:

 (i) the making of offers to acquire or dispose of financial products; or

 (ii) the acceptance of such offers.

 (2) However, the following conduct does not constitute operating a financial market for the purposes of this Chapter:

 (a) a person making or accepting offers or invitations to acquire or dispose of financial products on the person’s own behalf, or on behalf of one party to the transaction only, unless the regulations specify circumstances in which such conduct does constitute operating a financial market and the person’s conduct occurs in circumstances so specified;

 (b) conducting treasury operations between related bodies corporate;

 (c) a person, being the holder of a licence under an Australian law relating to the licensing of auctioneers, conducting an auction of forfeited shares;

 (d) any other conduct of a kind prescribed by regulations made for the purposes of this paragraph.

Division 6—What is a clearing and settlement facility?

768A  What is a clearing and settlement facility?

 (1) For the purposes of this Chapter, a clearing and settlement facility is a facility that provides a regular mechanism for the parties to transactions relating to financial products to meet obligations to each other that:

 (a) arise from entering into the transactions; and

 (b) are of a kind prescribed by regulations made for the purposes of this paragraph.

Example 1: A facility that provides a regular mechanism for stockbrokers to pay for the shares they buy and to be paid for the shares they sell, and for records of those transactions to be processed to facilitate registration of the new ownership of the shares, would be a clearing and settlement facility (assuming that the relevant obligations are of a kind prescribed by regulations made for the purposes of this section).

Example 2: A facility that provides a regular mechanism for registering trade in derivatives on a futures market and that enables the calculation of payments that market participants owe by way of margins would also be a clearing and settlement facility (assuming that the relevant obligations are of a kind prescribed by regulations made for the purposes of this section).

 (2) However, the following conduct does not constitute operating a clearing and settlement facility for the purposes of this Chapter:

 (a) an ADI (within the meaning of the Banking Act 1959) acting in the ordinary course of its banking business;

 (b) a person acting on their own behalf, or on behalf of one party to a transaction only;

 (c) a person who provides financial services to another person dealing with the other person’s accounts in the ordinary course of the first person’s business activities;

 (d) the actions of a participant in a clearing and settlement facility who has taken on the delivery or payment obligations, in relation to a particular financial product, of another person who is a party to a transaction relating to a financial product;

 (e) conducting treasury operations between related bodies corporate;

 (h) operating a facility for the exchange and settlement of non‑cash payments (see section 763D) between providers of non‑cash payment facilities;

 (i) any other conduct of a kind prescribed by regulations made for the purposes of this paragraph.

Division 7—General provisions relating to civil and criminal liability

769A  Part 2.5 of Criminal Code does not apply

  Despite section 1308A, Part 2.5 of the Criminal Code does not apply to any offences based on the provisions of this Chapter.

Note: For the purposes of offences based on provisions of this Chapter, corporate criminal responsibility is dealt with by section 769B, rather than by Part 2.5 of the Criminal Code.

769B  People are generally responsible for the conduct of their agents, employees etc.

 (1) Subject to subsections (7) and (8), conduct engaged in on behalf of a body corporate: