Federal Register of Legislation - Australian Government

Primary content

Superannuation Industry (Supervision) Act 1993

  • - C2004A04633
  • In force - Superseded Version
  • View Series
Act No. 78 of 1993 as made
An Act to make provision for the supervision of certain entities engaged in the superannuation industry, and for related purposes
Administered by: Treasury
Date of Assent 30 Nov 1993

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993

 

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - TABLE OF PROVISIONS

 

                       TABLE OF PROVISIONS

                       PART 1-PRELIMINARY

Section

                     Division 1-Preliminary

    1.    Short title

    2.    Commencement

    3.    Object of Act

    4.    Summary of provisions

    5.    Outline of key concepts

    6.    General administration of Act

    7.    Application of Act not to be excluded or modified

    8.    Act extends to external Territories

    9.    Crown to be bound

                    Division 2-Interpretation

   10.    Definitions

   11.    Approvals, determinations etc. by Commissioner

   12.    Associates

   13.    Single trustees and groups of trustees

   14.    Indefinitely continuing fund-application of rules

          against perpetuities

   15.    Payments for purchase of annuities

   16.    Definitions associated with employer-sponsorship

   17.    Persons involved in contravention

   18.    Public offer superannuation fund

   19.    Regulated superannuation fund

   20.    Related bodies corporate

                    PART 2-APPROVAL OF TRUSTEES

   21.    Object of Part

   22.    Interpretation

   23.    Application for approval

   24.    Further information may be requested

   25.    Period within which application for approval is to be

          decided

   26.    Deciding an application for approval

   27.    When an approval is in force

   28.    Revocation of approval

   29.    Notification of change in circumstances or breach of

          conditions

     PART 3-OPERATING STANDARDS FOR SUPERANNUATION ENTITIES

   30.    Object of Part

   31.    Operating standards for regulated superannuation funds

   32.    Operating standards for approved deposit funds

   33.    Operating standards for pooled superannuation trusts

   34.    Prescribed operating standards must be complied with

     PART 4-TRUSTEE OF SUPERANNUATION ENTITY TO LODGE ANNUAL

                  RETURNS WITH THE COMMISSIONER

   35.    Object of Part

   36.    Trustee to lodge annual returns

           PART 5-NOTICES ABOUT COMPLYING FUND STATUS

             Division 1-Objects and interpretation

   37.    Objects of Part

   38.    Meaning of "entity"

          Division 2-Commissioner may give notices about

                    complying fund status

   39.    Meaning of "contravention"

   40.    Notices by Commissioner to trustee

   41.    When Commissioner obliged to give notice of compliance

   42.    Complying superannuation fund

   43.    Complying approved deposit fund

   44.    Pooled superannuation trust

        Division 3-Complying fund status for tax purposes

   45.    Complying superannuation fund

   46.    Complying superannuation scheme-superannuation

          guarantee charge

   47.    Complying approved deposit fund

   48.    Pooled superannuation trust

   49.    Transitional-notices under the repealed provisions of

          the Occupational Superannuation Standards Act 1987

   50.    Transitional-late lodgment of elections by trustees of

          superannuation funds

        PART 6-PROVISIONS RELATING TO GOVERNING RULES OF

                     SUPERANNUATION ENTITIES

   51.    Object of Part

   52.    Covenants to be included in governing rules

   53.    Covenants to repay amounts to beneficiaries in approved

          deposit funds

   54.    Prerequisites to variation of repayment period

   55.    Consequences of contravention of covenant

   56.    Indemnification of trustee from assets of entity

 

Back to Top



   57.    Indemnification of directors of trustee from assets of

          entity

   58.    Trustee not to be subject to direction

   59.    Exercise of discretion by person other than trustee

   60.    Amendment of governing rules

           PART 7-PROVISIONS APPLYING ONLY TO REGULATED

                     SUPERANNUATION FUNDS

   61.    Object of Part

   62.    Sole purpose test

   63.    Commissioner may direct trustees of certain regulated

          superannuation funds not to accept employer

          contributions

   64.    Superannuation contributions-deductions from salary or

          wages to be remitted promptly

   65.    Lending to members of regulated superannuation fund

          prohibited

   66.    Acquisitions of certain assets from members of

          regulated superannuation funds prohibited

   67.    Borrowing

   68.    Victimisation of trustees etc.

        PART 8-IN-HOUSE ASSET RULES APPLYING TO REGULATED

                      SUPERANNUATION FUNDS

             Division 1-Object and interpretation

   69.    Object of Part

   70.    Associate of employer-sponsor

   71.    Meaning of "in-house asset"

   72.    How this Part applies if there are 2 or more unrelated

          employer-sponsors

   73.    Cost of in-house asset

   74.    Historical cost ratio of fund's in-house assets

   75.    Market value ratio of fund's in-house assets

        Division 2-Historical cost ratio of fund's in-house assets

   76.    Private sector funds established on or after 12 March

          1985-historical cost ratio for the 1994-95 year of

          income

   77.    Private sector funds established before 12 March

          1985-historical cost ratio for the 1994-95 year of

          income

   78.    Public sector funds established on or after 1 July

          1990-historical cost ratio for the 1994-95 year of

          income

   79.    Public sector funds established before 1 July

          1990-historical cost ratio for the 1994-95 year of

          income

   80.    All funds-historical cost ratio for the 1995-96 year of

          income, the 1996-97 year of income and the 1997-98 year

          of income

        Division 3-Market value ratio of fund's in-house assets

   81.    All funds-market value ratio for the 1998-99 year of

          income and the 1999-2000 year of income

   82.    All funds-market value ratio for the 2000-2001 year of

          income and later years of income

   83.    Certain new in-house asset investments prohibited

                   Division 4-Enforcement

   84.    In-house asset rules must be complied with

                  Division 5-Anti-avoidance

   85.    Prohibition of avoidance schemes

         PART 9-EQUAL REPRESENTATION OF EMPLOYERS AND

               MEMBERS-EMPLOYER-SPONSORED FUNDS

   86.    Object of Part

   87.    Consequences of non-compliance with this Part

   88.    This Part does not apply if acting trustee appointed

          under Part 17

   89.    Basic equal representation rules

   90.    Pre-1 July 1995 rules-funds with fewer than 200 members

   91.    Pre-1 July 1995 rules-funds with 200 or more members

   92.    Post-30 June 1995 rules-funds with more than 4, but

          fewer than 50, members

   93.    Post-30 June 1995 rules-funds with more than 49 members

        PART 10-PROVISIONS APPLYING ONLY TO APPROVED DEPOSIT FUNDS

   94.    Object of Part

   95.    Borrowing

            PART 11-PROVISIONS APPLYING ONLY TO POOLED

                     SUPERANNUATION TRUSTS

   96.    Object of Part

   97.    Borrowing

   98.    Lending to unit-holders prohibited

   99.    Civil penalty provisions

        PART 12-DUTIES OF TRUSTEES AND INVESTMENT MANAGERS OF

                    SUPERANNUATION ENTITIES

 

Back to Top



  100.    Object of Part

  101.    Duty to establish arrangements for dealing with

          inquiries or complaints

  102.    Duty to seek information from investment manager

  103.    Duty to keep minutes and records

  104.    Duty to keep records of changes of trustees

  105.    Duty to keep reports

  106.    Duty to notify Commissioner of significant adverse

          events

  107.    Duty of trustee of employer-sponsored fund to establish

          procedure for appointing member representatives

  108.    Duty of trustee of employer-sponsored fund to establish

          procedure for appointing independent trustee or

          independent member of board of directors of corporate

          trustee

  109.    Investments of superannuation entity to be made on an

          arm's length basis

           PART 13-ACCOUNTS OF SUPERANNUATION ENTITIES

  110.    Object of Part

  111.    Accounting records

  112.    Accounts

  113.    Audit of accounts

        PART 14-OTHER PROVISIONS APPLYING TO SUPERANNUATION ENTITIES

  114.    Object of Part

  115.    Trustee of superannuation entity may maintain reserves

  116.    Agreement between trustee and investment manager

  117.    Circumstances in which amounts may be paid out of an

          employer-sponsored fund to an employer-sponsor

  118.    Consents to appointments

        PART 15-STANDARDS FOR TRUSTEES, CUSTODIANS AND INVESTMENT

               MANAGERS OF SUPERANNUATION ENTITIES

  119.    Object of Part

  120.    Disqualified persons

  121.    Disqualified persons not to be trustees of

          superannuation entities

  122.    Investment manager must not appoint or engage custodian

          without the trustee's consent

  123.    Persons who may be appointed to be custodians of

          superannuation entities

  124.    Investment managers must be appointed in writing

  125.    Individuals not to be investment managers of

          superannuation entities

  126.    Disqualified persons not to be investment managers of

          superannuation entities

  127.    Non-compliance not to invalidate appointment or

          transaction

        PART 16-ACTUARIES AND AUDITORS OF SUPERANNUATION ENTITIES

  128.    Object of Part

  129.    Obligations of actuaries and auditors-compliance

  130.    Obligations of actuaries and auditors-solvency

  131.    Auditors-disqualification orders

          PART 17-SUSPENSION OR REMOVAL OF TRUSTEE OF

                    SUPERANNUATION ENTITY

  132.    Object of Part

  133.    Suspension or removal of trustee of superannuation

          entity

  134.    Commissioner to appoint acting trustee in cases of

          suspension or removal

  135.    Terms and conditions of appointment of acting trustee

  136.    Termination of appointment of acting trustee

  137.    Resignation of acting trustee

  138.    Property vesting orders

  139.    Powers of acting trustee

  140.    Acting trustee to notify appointment to beneficiaries

  141.    Commissioner may give directions to acting trustee

  142.    Commissioner may formulate a scheme for the winding-up

          or dissolution, or both, of a superannuation entity

             PART 18-PROHIBITED CONDUCT IN RELATION TO

                     SUPERANNUATION INTERESTS

  143.    Object of Part

  144.    Regulated acts

  145.    Fraudulently inducing a person to engage in a regulated

          act-criminal liability

  146.    Misleading conduct in connection with a regulated

          act-civil liability

  147.    Misleading conduct by trustees of entities-civil

          liability

  148.    Civil liability where section 146 or 147 contravened

  149.    Contravention of Part does not affect validity of issue

          of superannuation interest etc.

 

Back to Top



        PART 19-PUBLIC OFFER ENTITIES-PROVISIONS RELATING TO

        SUPERANNUATION INTERESTS AND DISCLOSURE OF INFORMATION

                     Division 1-Preliminary

  150.    Object of Part

  151.    Contravention of Part does not affect validity of issue

          of superannuation interest etc.

        Division 2-Issuing, offering etc. superannuation interests

                    in public offer entities

  152.    Limitation on issuing, offering etc. superannuation

          interests in public offer entities

  153.    Trustee must not issue interests, or permit persons to

          become standard employer-sponsors, except pursuant to

          applications

  154.    Commission and brokerage

  155.    Fair dealing on issue or redemption of a superannuation

          interest

  156.    Civil liability where subsection 155(2) contravened

        Division 3-Provisions relating to information given to

        prospective beneficiaries etc. of public offer entities

         Subdivision A-Certain information to be given to

                 prospective beneficiaries etc.

  157.    Information to be given before superannuation interests

          issued otherwise than to standard employer-sponsored

          member

  158.    Information to be given before persons become standard

          employer-sponsors

  159.    Regulations and determinations requiring the giving of

          information

  160.    Documents taken to contain information referred to

        Subdivision B-Limitations on issuing regulated documents

  161.    Regulated documents not to be false or

          misleading-criminal liability

  162.    Regulated documents not to be false or misleading-civil

          liability

  163.    Statements by experts

                     Division 4-Stop orders

  164.    Order to stop contracts etc. for issue of

          superannuation interests in public offer entities

  165.    When a stop order is in force

  166.    Revocation of stop order

  167.    Effect of stop order

        Division 5-Application money to be held on trust

  168.    Situation to which Division applies-application money

          received but superannuation interest not issued

          immediately

  169.    Trustee to comply with requirements of the regulations

          in relation to the money

        Division 6-Cooling-off-redemption of interests

  170.    Situation to which Division applies-superannuation

          interest issued in certain circumstances

  171.    Governing rules taken to confer right to have interest

          redeemed

  172.    Consequences of contravening provisions taken to be

          included in governing rules

         PART 20-PUBLIC OFFER ENTITIES-INSIDER TRADING

                     Division 1-Preliminary

  173.    Object of Part

  174.    Superannuation interest means interest in public offer

          entity

                   Division 2-Interpretation

  175.    Definitions

  176.    When information is generally available

  177.    When information has a material effect on price or

          value of superannuation interests

  178.    Information in possession of officer of body corporate

               Division 3-Insider trading rules

  179.    When a person contravenes the insider trading rules in

          relation to superannuation interests

  180.    Exception to insider trading rules-Chinese wall

          arrangements by bodies corporate

  181.    Exception to insider trading rules-knowledge of

          person's own intentions or activities

  182.    Exceptions to insider trading rules-special rules

          relating to bodies corporate

  183.    Exception to insider trading rules-officers or agents

          of bodies corporate

        Division 4-Offence of contravening the insider trading rules

  184.    Offence of contravening the insider trading rules

        Division 5-Civil liability for contravention of the

        insider trading rules-recovery of loss or damage

 

Back to Top



  185.    Civil liability where plaintiff suffers loss or damage

          because of a contravention of the insider trading rules

        Division 6-Civil liability for contravention of the insider

         trading rules-recovery of price differential

  186.    Civil liability-trustee may recover price differential

  187.    Commissioner may bring an action in the name of a

          trustee

  188.    Special defence where information made known in a

          certain manner

  189.    Amounts recovered to be held on trust for certain

          interest-holders

  190.    Offset of amounts recovered in other proceedings

        Division 7-Special powers of Court to make orders in cases

          of contravention of the insider trading rules

  191.    Special powers of Court

        PART 21-CIVIL AND CRIMINAL CONSEQUENCES OF CONTRAVENING

                   CIVIL PENALTY PROVISIONS

                    Division 1-Preliminary

  192.    Object of Part

  193.    Civil penalty provisions

  194.    Person involved in contravening a provision taken to

          have contravened the provision

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

          offence

                Division 2-Civil penalty orders

  196.    Court may make civil penalty orders

  197.    Who may apply for civil penalty order

  198.    Time limit for application

  199.    Application for civil penalty order is a civil

          proceeding

  200.    Enforcement of order to pay monetary penalty

  201.    Commissioner may require a person to give assistance in

          connection with application for civil penalty order

                Division 3-Criminal proceedings

  202.    When contravention of civil penalty provisions is an

          offence

  203.    Application for civil penalty order precludes later

          criminal proceedings

        Division 4-Effect of criminal proceedings on application

                    for civil penalty order

  204.    When Division applies

  205.    Effect during criminal proceedings

  206.    Final outcome precluding applications for civil penalty

          order

  207.    Final outcome not precluding application for civil

          penalty order

  208.    After unsuccessful committal proceeding, court may

          preclude application for civil penalty order

  209.    Application for civil penalty order based on

          alternative verdict at jury trial

  210.    Application for civil penalty order based on

          alternative finding by court of summary jurisdiction

  211.    Application for civil penalty order based on

          alternative finding by appeal court

  212.    After setting aside declaration, court may preclude

          application for civil penalty order

  213.    On unsuccessful appeal against declaration, Court may

          make civil penalty orders

  214.    Appeals under this Division

          Division 5-Compensation for loss suffered by

                     superannuation entity

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

          compensation

  216.    Criminal court may order compensation

  217.    Enforcement of order under section 215 or 216

  218.    Recovery of profits, and compensation for loss,

          resulting from contravention

  219.    Effect of sections 215, 216 and 218

  220.    Certificates evidencing contravention

                   Division 6-Miscellaneous

  221.    Relief from liability for contravention of civil

          penalty provision

  222.    Part does not limit power to award punitive damages

                    PART 22-UNCLAIMED MONEY

  223.    Object of Part

  224.    Definition of "fund"

  225.    Trustee to pay unclaimed money to the Commissioner

  226.    Register of unclaimed money

           PART 23-FINANCIAL ASSISTANCE TO CERTAIN FUNDS

                     Division 1-Preliminary

 

Back to Top



  227.    Object of Part

  228.    Interpretation

  229.    Application for assistance

  230.    Minister may request additional information

          Division 2-Determination of applications for

                      financial assistance

  231.    Minister may grant financial assistance

  232.    Maximum amount of financial assistance

  233.    Financial assistance to be subject to conditions

        Division 3-How financial assistance is to be paid

  234.    Superannuation Protection Account

  235.    Minister to decide the source from which financial

          assistance is to be paid

  236.    Purposes of Account

  237.    Separate notional accounts to be kept within the

          Account

  238.    Financial assistance to be repaid in certain

          circumstances

  239.    Minister may remit liability

  240.    Repayable grant to have priority over other debts

        PART 24-ROLLOVER OF CERTAIN BENEFITS BETWEEN FUNDS

  241.    Object of Part

  242.    Interpretation

  243.    Declaration of eligible funds

  244.    Rollover of benefits from superannuation fund

  245.    Trustee to give information to eligible rollover fund

  246.    Reports to include reports sent before commencement of

          Part

  247.    Notice to members and beneficiaries of circumstances in

          which benefits may be rolled-over

  248.    What happens if benefits are below minimum amount

  249.    Trustee of eligible rollover fund to notify

          Commissioner of receipt of payments

  250.    Register of rolled-over benefits

  251.    Rights of beneficiary to rolled-over benefits

  252.    Claims to rolled-over benefits

        PART 25-MONITORING AND INVESTIGATING SUPERANNUATION ENTITIES

                   Division 1-Objects of Part

  253.    Objects of Part

        Division 2-Monitoring superannuation entities

  254.    Information to be given to Commissioner

  255.    Commissioner may require production of books

  256.    Access to premises

        Division 3-Commissioner may require trustee of superannuation

       entity to appoint an individual, or a committee, to

         investigate the financial position of the entity

  257.    Investigation of financial position of superannuation

          entity

  258.    Qualifications of investigator or investigators

  259.    Commissioner may veto appointment of investigator or

          investigators

  260.    Deadline for receipt of report

  261.    Contents of report etc.

  262.    Trustee must comply with this Division

           Division 4-Investigations by Commissioner

  263.    Investigation of superannuation entity

  264.    Power of Commissioner to obtain information or freeze

          assets

  265.    Inspectors

  266.    Delegation by inspector

  267.    Commissioner may exercise powers of inspector

  268.    Inspector may enter premises for purposes of an

          investigation

  269.    Inspector may require production of books

  270.    Powers of inspector to require assistance from, and

          examine, relevant persons

  271.    Application for warrant to seize books not produced

  272.    Grant of warrant

  273.    Powers if books produced or seized

  274.    Powers if books not produced

  275.    Power to require person to identify property of

          superannuation entity

                     Division 5-Examinations

  276.    Application of Division

  277.    Requirements made of an examinee

  278.    Examination to be in private

  279.    Examinee's lawyer may attend

  280.    Record of examination

  281.    Giving copies of record to other persons

  282.    Copies given subject to conditions

 

Back to Top



  283.    Record to accompany report

                      Division 6-Reports

  284.    Report of inspector

                      Division 7-Offences

  285.    Persons to comply with requirements made under this Act

  286.    Concealing books relevant to investigation

  287.    Self-incrimination

  288.    Legal professional privilege

  289.    Powers of Court where non-compliance with this Act

        Division 8-Evidentiary use of certain material

  290.    Statements made at an examination: proceedings against

          examinee

  291.    Statements made at an examination: other proceedings

  292.    Weight of evidence admitted under section 291

  293.    Objection to admission of statements made at

          examination

  294.    Copies of, or extracts from, certain books

  295.    Report under Division 6

  296.    Exceptions to admissibility of report

  297.    Material otherwise admissible

                  Division 9-Miscellaneous

  298.    Commissioner may cause civil proceeding to be begun

  299.    Person complying with requirement not to incur

          liability to another person

        PART 26-OFFENCES RELATING TO STATEMENTS, RECORDS ETC.

  300.    Object of Part

  301.    Interpretation

  302.    False or misleading statements

  303.    Incorrectly keeping records etc.

  304.    Recklessly making false or misleading statements

  305.    Intentionally making false or misleading statements

  306.    Intentionally or recklessly incorrectly keeping records

          etc.

  307.    Incorrectly keeping records with intention of deceiving

          or misleading etc.

  308.    Falsifying or concealing identity with intention of

          deceiving or misleading etc.

                     PART 27-POWERS OF COURT

  309.    Object of Part

  310.    Power to grant relief

  311.    Power of Court to give directions with respect to

          meetings ordered by the Court

  312.    Irregularities

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

          or property

  314.    Court may order the disclosure of information or the

          publication of advertisements-contravention of

          provisions relating to issue of superannuation

          interests etc.

  315.    Injunctions

  316.    Effect of sections 313, 314 and 315

  317.    Power of Court to punish for contempt of court

  318.    Court may resolve transitional difficulties

                      PART 28-PROCEEDINGS

  319.    Object of Part

  320.    Power of Commissioner to intervene in proceedings

  321.    Civil proceedings not to be stayed

  322.    Standard of proof

  323.    Relief from civil liability for contravention of

          certain provisions

  324.    Evidence of contravention

  325.    Vesting of property

             PART 29-EXEMPTIONS AND MODIFICATIONS

  326.    Object of Part

  327.    Interpretation

  328.    Commissioner's powers of exemption-modifiable

          provisions

  329.    Commissioner's powers of exemption-temporarily

          modifiable provisions

  330.    Commissioner's powers of exemption-general issues

  331.    Enforcement of conditions to which exemption is subject

  332.    Commissioner's powers of modification-modifiable

          provisions

  333.    Commissioner's powers of modification-temporarily

          modifiable provisions

  334.    Commissioner's powers of modification-general issues

  335.    Revocation of exemptions and modifications

  336.    Publication of exemptions and modifications etc.

                    PART 30-MISCELLANEOUS

  337.    Object of Part

 

  338.    Conduct by directors, servants and agents

Back to Top

  339.    Conviction does not relieve defendant from civil

          liability

  340.    Liability for damages

  341.    Civil immunity where defendant was complying with this

          Act

  342.    Pre-1 July 88 funding credits and debits

  343.    Rules against perpetuities not to apply to

          superannuation entity

  344.    Review of certain decisions

  345.    Statements to accompany notification of decisions

  346.    Secrecy

  347.    How information may be given to the Commissioner of

          Taxation

  348.    Commissioner may publish statistical information

  349.    This Act and the regulations have effect subject to the

          Crimes (Superannuation Benefits) Act 1989

  350.    Concurrent operation of State/Territory laws

  351.    Delegation

  352.    Annual reports

  353.    Regulations

        PART 31-TRANSITION TO SCHEME PROVIDED FOR IN THIS ACT

                  Division 1-Object of Part

  354.    Object of Part

        Division 2-Entities that have a management company

                        and a trustee

                    Subdivision A-General

  355.    Entity to which Division applies

  356.    Interpretation

        Subdivision B-Existing management company may retire

  357.    Existing management company may give notice of

          retirement

  358.    Effect of notice under section 357

  359.    Action to be taken by existing trustee on receipt of

          notice under section 357

  360.    Commissioner to appoint new trustee if receives notice

          under subsection 359(2)

  361.    Effect of notice under subsection 359(2)

  362.    What happens if existing trustee fails to give a notice

          under subsection 359(2) or (3)

           Subdivision C-Existing trustee may retire

  363.    Existing trustee may give notice of retirement

  364.    Action to be taken by existing management company on

          receipt of notice under section 363

  365.    Commissioner to appoint new trustee

  366.    Effect of notice under section 363 on trustee

  367.    Effect of notice under section 363 on management

          company

  368.    Notices under sections 363 and 364 have no effect

          except as provided in this Division

  369.    What happens if existing management company fails to

          give a notice under subsection 364(2) or (3)

        Subdivision D-What happens if existing management company

        or existing trustee stops holding office otherwise than

                     under this Division

  370.    Existing management company ceases to hold office first

  371.    Existing trustee ceases to hold office first

  372.    Existing trustee cannot cease to hold office at same

          time as existing management company

        Subdivision E-Special provisions in relation to

                   the transitional period

  373.    Interpretation

  374.    Existing trustee taken to be an approved trustee

  375.    Application of section 153 during the transitional

          period

  376.    Regulations may modify application of Act and apply

          provisions of the Corporations Law etc.

                Subdivision F-Miscellaneous

  377.    New trustee to notify appointment to members

  378.    Civil immunity for actions under Division

  379.    Division has effect despite anything in any other Part

          of this Act etc.

        Division 3-Regulations may make other transitional provisions

  380.    Regulations may make other transitional provisions

        PART 32-ADDITIONAL TRANSITIONAL PROVISIONS-TAX FILE NUMBERS

  381.    Object of Part

  382.    Quotation of tax file number

  383.    Pre-1 July 1994 quotation of tax file number to be

          treated as if made under provisions commencing on

          1 July 1994

 

  384.    Pre-1 July 1994 quotation of tax file number-request

Back to Top

          for quotation, or recording, of number not prohibited

          by the Taxation Administration Act 1953

  385.    Pre-1 July 1994 quotation of tax file number-objects of

          tax file number system

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - LONG TITLE

 

         An Act to make provision for the supervision of

 

         certain entities engaged in the superannuation

              industry, and for related purposes

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 1

 

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 1

 

 

                                   (Assented to 30 November 1993)

                       PART 1-PRELIMINARY

 

                     Division 1-Preliminary

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 1

 

Short title

 

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

1993.

 

(Minister's second reading speech made in -

          House of Representatives on 27 May 1993

          Senate on 19 October 1993)

 

  2.(1) Subject to this section, Parts 1, 2, 21, 27, 28, 29, 30, 31 and 32

commence on the day on which this Act receives the Royal Assent.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 2

 

Commencement

 

  (2) Part 1 (in so far as it relates to section 117) and section 117 are

taken to have commenced on 21 October 1992.

  (3) Parts 18, 19, 20, 22, 23 and 24 and section 342 commence on 1 July 1994.

  (4) The remaining provisions commence on 1 December 1993, but do not apply

to a fund, scheme or trust in relation to a year of income of the fund, scheme

or trust earlier than the 1994-95 year of income.

 

  3.(1) The object of this Act is to make provision for the prudent management

of certain superannuation funds, approved deposit funds and pooled

superannuation trusts and for their supervision by the Insurance and

Superannuation Commissioner.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 3

 

Object of Act

Supervision of certain superannuation entities

 

Basis for supervision

  (2) The basis for supervision is that those funds and trusts are subject to

regulation under the Commonwealth's powers with respect to corporations or

pensions (for example, because the trustee is a corporation). In return, the

supervised funds and trusts may become eligible for concessional taxation

treatment.

Whole industry not covered

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

industry.

 

  4. The Act contains provisions dealing with the following matters:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 4

 

Summary of provisions

 

Part No.    Matter dealt with

  1         interpretation

  2         approval of trustees

  3         operating standards for funds and trusts

  4         lodgment of annual returns by trustees of

            superannuation entities

  5         notices about complying fund status

  6         governing rules of funds and trusts

  7         rules applying only to regulated superannuation funds

  8         in-house asset rules applying to regulated

            superannuation funds

  9         equal representation of employers and members in

            relation to employer-sponsored funds

 10         rules applying only to approved deposit funds

 11         rules applying only to pooled superannuation trusts

 12         statutory duties of trustees of superannuation

            entities

 13         accounts of superannuation entities

 14         other provisions relating to funds and trusts

 15         standards for trustees, custodians and investment

            managers of superannuation entities

 16         actuaries and auditors of superannuation entities

 17         suspension or removal of trustees of superannuation

            entities

 18         false and misleading conduct in relation to

            superannuation interests

 19         rules about dealing with superannuation interests in

            public offer entities and about the disclosure of

            information about such entities

 

 20         rules relating to insider trading of superannuation

Back to Top

            interests in public offer entities

 21         civil and criminal consequences of serious breaches

            of the Act

 22         how funds are to deal with unclaimed money

 23         financial assistance to funds that suffer loss as a

            result of fraud or theft

 24         rollover of benefits to certain funds when

            beneficiaries cannot be located

 25         monitoring and investigating superannuation entities

 26         offences relating to statements and records

 27         powers of courts

 28         judicial and other proceedings under the Act

 29         exemption and modification provisions

 30         miscellaneous provisions

 31         transition to scheme provided for in the Act

 32         additional transitional provisions relating to tax

            file numbers

 

  5.(1) The following superannuation entities are involved:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 5

 

Outline of key concepts

Entities

 

  complying superannuation fund             eligibility for

  complying approved deposit fund           concessional

  pooled superannuation trust               taxation treatment

Complying superannuation fund

  (2) The complying superannuation fund requirements may be summarised as

follows:

                 Complying superannuation fund

  regulated superannuation fund             +    compliance with Act

  fund is a superannuation fund

                 +                                     basically:

  trustee is constitutional corporation          - operating standards

                OR                               - governing rules

  fund is age-pension provider                   - borrowing rules

                 +                               - lending rules

  election to be subject to Act                  - in-house asset rules

                                                 - equal representation

                                                   rules

                                                 - accounting requirements

                                                 - trustee, investment

                                                   manager, actuary and

                                                   auditor standards

                                                 - public offer

                                                   requirements

Complying approved deposit fund

  (3) The complying approved deposit fund requirements may be summarised as

follows:

                    Complying approved deposit fund

  approved deposit fund

  fund receives ETPs on deposit        +         compliance with Act

           +

  trustee is constitutional                           basically:

  corporation                                    - operating standards

           +                                     - governing rules

  trustee has been approved                      - borrowing rules

                                                 - accounting requirements

                                                 - trustee, investment

                                                   manager, actuary and

                                                   auditor standards

                                                 - public offer

                                                   requirements

Pooled superannuation trust

  (4) The pooled superannuation trust requirements may be summarised as

follows:

                   Pooled superannuation trust

  pooled superannuation trust        +           compliance with Act

  trust meets prescribed

  requirements                                        basically:

           +                                     - operating standards

  trustee is constitutional                      - governing rules

  corporation                                    - borrowing rules

                                                 - lending rules

                                                 - accounting requirements

                                                 - trustee, investment

                                                   manager, actuary and

                                                   auditor standards

                                                 - public offer

                                                   requirements



 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 6

 

General administration of Act

 

  6.(1) Subject to subsection (2), the Commissioner has the general

administration of this Act.


Back to Top

  (2) The Minister may give directions to the Commissioner about the

performance or exercise of the Commissioner's functions or powers under this

Act.

 

  7. This Act applies to a superannuation entity despite any provision in the

governing rules of the entity, including any provision that purports to

substitute, or has the effect of substituting, the provisions of the law of a

State or Territory or of a foreign country for all or any of the provisions of

this Act.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 7

 

Application of Act not to be excluded or modified

 

 

  8. This Act extends to all the external Territories.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 8

 

Act extends to external Territories

 

 

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

  (2) The Crown is not liable to be prosecuted for an offence against, or

arising out of, this Act.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 9

 

Crown to be bound

 

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 2

 

 

  10. In this Act, unless the contrary intention appears:

                   Division 2-Interpretation

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 10

 

Definitions

 

  "actuary" means a person who is a Fellow or an Accredited Member of the

Institute of Actuaries of Australia;

  "adopted child", in relation to a person, means a person adopted by the

first-mentioned person:

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

children; or

  (b) under the law of any other place relating to the adoption of children,

if the validity of the adoption would be recognised under the law of any State

or Territory;

  "amend", in relation to the governing rules of a superannuation entity,

includes the insertion of a provision in, or the omission of a provision from,

those rules;

  "annuity" includes a benefit provided by a life insurance company or a

registered organisation, if the benefit is taken, under the regulations, to be

an annuity for the purposes of this Act;

  "approved auditor" means a person included in a class of persons specified

in regulations made for the purposes of this definition, but does not include

a person in respect of whom a disqualification order is in force under section

131;

  "approved bank" means:

  (a) a body corporate authorised under Part II of the Banking Act 1959 to

carry on banking business in Australia; or

  (b) the Commonwealth Bank of Australia, the Commonwealth Savings Bank of

Australia or the Commonwealth Development Bank of Australia; or

  (c) a State bank;

  "approved deposit fund" means a fund that:

  (a) is an indefinitely continuing fund; and

  (b) is maintained by an approved trustee solely for approved purposes; and

  (c) has approved rules;

  "approved form" means a form approved by the Commissioner, in writing, for

the purposes of the provision in which the expression appears;

  "approved guarantee" means a guarantee given by an approved bank or given by

or on behalf of the Commonwealth, a State or a Territory;

  "approved purposes", in relation to a fund, means the purposes of:

  (a) receiving on deposit:

    (i) amounts that will be taken by section 27D of the Income

Tax Assessment Act to have been expended out of eligible termination payments

within the meaning of that section; and

    (ii) amounts paid under Part 24; and

  (b) dealing with such amounts, in accordance with the rules of the fund, in

any way calculated directly or indirectly to enhance the value of, or render

profitable, property of the fund; and

  (c) subject to any contrary requirement in the standards from time to time

applicable to the fund under section 32, paying in accordance with the

covenant referred to in section 53 to beneficiaries, or to the legal personal

representatives of beneficiaries, amounts deposited with the fund together

with accumulated earnings on those amounts;

  "approved rules", in relation to a fund, means governing rules of the fund

that include all the kinds of provisions specified in regulations made for the

purposes of this definition;

  "approved trustee" means a constitutional corporation in relation to which

an approval under section 26 is in force;

  "associate" has the meaning given by section 12;

  "Australian court" means:

 

  (a) the High Court; or

Back to Top

  (b) a court created by the Parliament; or

  (c) a court of a State or Territory;

  "authorised person" means an officer of the Australian Public Service

authorised by the Commissioner, in writing, for the purposes of the provision

in which the expression appears;

  "beneficiary", in relation to a fund, scheme or trust, means a person

(whether described in the governing rules as a member, a depositor or

otherwise) who has a beneficial interest in the fund, scheme or trust and

includes, in relation to a superannuation fund, a member of the fund despite

the express references in this Act to members of such funds;

  "books" includes:

  (a) any record; or

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

stored; or

  (c) a document;

  "business day" means a day that is not a Saturday, a Sunday or a public

holiday in the place concerned;

  "child", in relation to a person, includes an adopted child, a step-child or

an ex-nuptial child of the person;

  "civil penalty order" means a declaration or order made under section 196;

  "civil penalty provision" has the meaning given by section 193;

  "Commissioner" means the Insurance and Superannuation Commissioner appointed

under the Insurance and Superannuation Commissioner Act 1987, or a person for

the time being acting as Insurance and Superannuation Commissioner under that

Act;

  "constitutional corporation" means a body corporate that is:

  (a) a trading corporation formed within the limits of the Commonwealth

(within the meaning of paragraph 51(xx) of the Constitution); or

  (b) a financial corporation formed within the limits of the Commonwealth

(within the meaning of paragraph 51(xx) of the Constitution);

  "corporate trustee", in relation to a fund, scheme or trust, means a body

corporate that is a trustee of the fund, scheme or trust;

  "Corporations Law" means the Corporations Law set out in the Corporations

Act 1989;

  "court" means any court, when exercising jurisdiction under this Act;

  "Court" means the Federal Court of Australia or the Supreme Court of a State

or a Territory;

  "custodian", in relation to a superannuation entity, means a person (other

than the trustee of the entity) who, under a contract with the trustee or an

investment manager of the entity, performs custodial functions in relation to

any of the assets of the entity;

  "data processing device" means any article or material (for example, a disc)

from which information is capable of being reproduced with or without the aid

of any other article or device;

  "deed" includes an instrument having the effect of a deed;

  "dependant", in relation to a person, includes the spouse and any child of

the person;

  "director", in relation to a body corporate, has the same meaning as in the

Corporations Law;

  "disclose", in relation to information, means give, reveal or communicate in

any way;

  "eligibility age", in relation to an age pension, means:

  (a) in the case of a man-65 years or, if another age is prescribed by the

regulations in place of 65 years, the age so prescribed; or

  (b) in the case of a woman-60 years or, if another age is prescribed by the

regulations in place of 60 years, the age so prescribed;

  "employee" has the same meaning as in the Superannuation Guarantee

(Administration) Act 1992 (for the purposes of this definition, the

Superannuation Guarantee (Administration) Act 1992 has effect as if subsection

12(11) of that Act had not been enacted);

  "employer" has the same meaning as in the Superannuation Guarantee

(Administration) Act 1992 (for the purposes of this definition, the

Superannuation Guarantee (Administration) Act 1992 has effect as if subsection

12(11) of that Act had not been enacted);

  "employer representative", in relation to a group of trustees of a fund, a

policy committee of a fund or the board of directors of a corporate trustee of

a fund, means a member of the group, committee or board, as the case may be,

nominated by:

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

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

employers;

  "employer-sponsor" has the meaning given by subsection 16(1);

  "employer-sponsored fund" has the meaning given by subsection 16(3);

  "excluded approved deposit fund" means an approved deposit fund:

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

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

regulations;

  "excluded fund" means an excluded superannuation fund or an excluded

approved deposit fund;

 

  "excluded superannuation fund" means a superannuation fund of which there

are fewer than 5 members;

Back to Top

  "executive officer", in relation to a body corporate, means a person, by

whatever name called and whether or not a director of the body, who is

concerned, or takes part, in the management of the body;

  "exempt public sector superannuation scheme" means a public sector

superannuation scheme that is specified in regulations made for the purposes

of this definition;

  "expert", in relation to a matter, means a person whose profession or

reputation gives authority to a statement made by him or her in relation to

that matter;

  "function" includes duty;

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

instrument, other document or legislation, or combination of them, governing

the establishment and operation of the fund, scheme or trust;

  "group of trustees", in relation to a fund, scheme or trust, means a board,

committee or other group of trustees of the fund, scheme or trust;

  "half-year" means a period of 6 months ending on 30 June or 31 December;

  "Income Tax Assessment Act" means the Income Tax Assessment Act 1936;

  "independent director", in relation to a corporate trustee of a fund, means

a director of the corporate trustee who:

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

  (b) is neither an employer-sponsor of the fund nor an associate of such an

employer-sponsor; and

  (c) is neither an employee of an employer-sponsor of the fund nor an

employee of an associate of such an employer-sponsor; and

  (d) is not, in any capacity, a representative of a trade union, or other

organisation, representing the interests of one or more members of the fund;

and

  (e) is not, in any capacity, a representative of an organisation

representing the interests of one or more employer-sponsors of the fund;

  "independent trustee", in relation to a fund, means a trustee of the fund

who:

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

  (b) is neither an employer-sponsor of the fund nor an associate of such an

employer-sponsor; and

  (c) is neither an employee of an employer-sponsor of the fund nor an

employee of an associate of such an employer-sponsor; and

  (d) is not, in any capacity, a representative of a trade union, or other

organisation, representing the interests of one or more members of the fund;

and

  (e) is not, in any capacity, a representative of an organisation

representing the interests of one or more employer-sponsors of the fund;

  "individual trustee", in relation to a fund, scheme or trust, means an

individual who is a trustee of the fund, scheme or trust;

  "insolvent under administration" means a person who:

  (a) under the Bankruptcy Act 1966 or the law of an external Territory, is a

bankrupt in respect of a bankruptcy from which the person has not been

discharged; or

  (b) under the law of a country other than Australia or the law of an

external Territory, has the status of an undischarged bankrupt;

and includes:

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

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

    (ii) a corresponding provision of the law of an external

Territory or the law of a foreign country; or

  (d) a person who has, at any time during the preceding 3 years, executed a

deed of assignment or a deed of arrangement under:

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

    (ii) the corresponding provisions of the law of an external

Territory or the law of a foreign country; or

  (e) a person whose creditors have, within the preceding 3 years, accepted a

composition under:

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

    (ii) the corresponding provisions of the law of an external

Territory or the law of a foreign country;

  "inspector" has the meaning given by section 265;

  "investment" means any mode of application of money for the purpose of

gaining interest, income or profit;

  "investment manager" means a person appointed by the trustee of a fund or

trust to invest money of the fund or trust;

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

17;

  "lawyer" means a duly qualified legal practitioner and, in relation to a

person, means such a practitioner acting for the person;

  "legal personal representative" means the executor of the will or

administrator of the estate of a deceased person, the trustee of the estate of

a person under a legal disability or a person who holds an enduring power of

attorney granted by a person;

  "life insurance company" means:

 

  (a) a company registered under section 19 of the Life Insurance Act 1945;

or

Back to Top

  (b) a public authority constituted by a law of a State or Territory, being

an authority that carries on life insurance business within the meaning of

subsection 4(1) of that Act;

  "lodge" means lodge with the Commissioner;

  "market value", in relation to an asset, means the amount that a willing

buyer of the asset could reasonably be expected to pay to acquire the asset

from a willing seller if the following assumptions were made:

  (a) that the buyer and the seller dealt with each other at arm's length in

relation to the sale;

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

  (c) that the buyer and the seller acted knowledgeably and prudentially in

relation to the sale;

  "member representative", in relation to a group of trustees of a fund, a

policy committee of a fund or the board of directors of a corporate trustee of

a fund, means a member of the group, committee or board, as the case may be,

nominated by:

  (a) the members of the fund; or

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

those members;

  "modifications" includes additions, omissions and substitutions;

  "occurrence of an event" includes the coming into existence of a state of

affairs;

  "old-age pensions" has the same meaning as in paragraph 51(xxiii) of the

Constitution;

  "pension", except in the expression "old-age pension", includes a benefit

provided by a fund, if the benefit is taken, under the regulations, to be a

pension for the purposes of this Act;

  "policy committee", in relation to a regulated superannuation fund, means a

board, committee or other body that:

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

the regulations; and

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

  "pooled superannuation trust" means a unit trust:

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

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

applies;

  "premises" includes:

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

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

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

a place;

  "private sector fund" means a superannuation fund other than a public sector

fund;

  "procure" includes cause;

  "produce" includes permit access to;

  "protected document" means a document given or produced under or for the

purposes of this Act, being a document containing information relating to the

affairs of any fund or trust;

  "protected information" means information disclosed or obtained under or for

the purposes of this Act, being information relating to the affairs of any

fund or trust;

  "public offer entity" means:

  (a) a public offer superannuation fund; or

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

or

  (c) a pooled superannuation trust;

  "public offer superannuation fund" has the meaning given by section 18;

  "public sector fund" means a superannuation fund that is part of a public

sector superannuation scheme;

  "public sector superannuation scheme" means a scheme for the payment of

superannuation, retirement or death benefits, where the scheme is

established:

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

  (b) under the authority of:

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

Territory; or

    (ii) a municipal corporation, another local governing body or

a public authority constituted by or under a law of the Commonwealth or of a

State or Territory;

  "rectify", in relation to a contravention of this Act or the regulations

that has occurred in relation to a superannuation entity, includes put in

operation managerial or administrative arrangements that could reasonably be

expected to ensure that there are no further contraventions of a similar

kind;

  "redeem", in relation to an interest in an approved deposit fund, includes

pay an amount equal to the interest pursuant to a covenant of a kind referred

to in section 53 that is contained, or taken to be contained, in the governing

rules of the fund;

 

  "registered organisation" means:

Back to Top

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

union; or

  (b) a society registered under a law of a State or Territory providing for

the registration of friendly or benefit societies; or

  (c) an association of employees that is registered as an organisation under

the Industrial Relations Act 1988;

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

document:

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

  (b) that the trustee knows, or ought reasonably to know (having regard to

the trustee's abilities, experience, qualifications and other attributes), may

influence a person's decision:

    (i) whether to apply to have a superannuation interest in the

entity issued to a person; or

    (ii) whether to apply to become a standard employer-sponsor

of the entity;

  "regulated superannuation fund" has the meaning given by section 19;

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

20;

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

  (a) if the trustee or an investment manager of the fund or trust is or

includes an individual-that individual; or

  (b) if the trustee or an investment manager of the fund or trust is or

includes a body corporate-a responsible officer of that body corporate; or

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

  (d) an actuary of the fund or trust;

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

  (a) a director of the body; or

  (b) a secretary of the body; or

  (c) an executive officer of the body;

  "reviewable decision" means:

  (a) a decision of the Commissioner under subsection 18(5) or (6) to make a

declaration; or

  (b) a decision of the Commissioner under subsection 18(9) to revoke a

declaration; or

  (c) a decision of the Commissioner under subsection 26(2) refusing an

application for approval; or

  (d) a decision of the Commissioner under subsection 26(3) to specify

conditions in an instrument of approval; or

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

  (f) a decision of the Commissioner refusing to give a notice under section

40; or

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

  (h) a decision of the Commissioner refusing to revoke a direction under

section 63; or

  (i) a decision of the Commissioner refusing to make a determination under

paragraph 71(1)(e); or

  (j) a decision of the Commissioner to revoke a determination under paragraph

71(1)(e); or

  (k) a decision of the Commissioner to make a determination under subsection

71(4); or

  (l) a decision of the Commissioner refusing to revoke a determination under

subsection 71(4); or

  (m) a decision of the Commissioner under section 92 refusing to grant an

approval; or

  (n) a decision of the Commissioner refusing to revoke an approval under

section 92; or

  (o) a decision of the Commissioner under subsection 95(2) refusing to

approve a borrowing; or

  (p) a decision of the Commissioner under subsection 117(6) refusing to waive

a requirement; or

  (q) a decision of the Commissioner under subparagraph 123(2)(b)(ii) or

(3)(c)(ii); or

  (r) a decision of the Commissioner under subparagraph 126(2)(b)(ii) or

(4)(c)(ii); or

  (s) a decision of the Commissioner to make a disqualification order under

section 131; or

  (t) a decision of the Commissioner refusing to revoke a disqualification

order under section 131; or

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

  (v) a decision of the Commissioner under section 164 to make a stop order;

or

  (w) a decision of the Commissioner under section 166 to revoke a stop order;

or

  (x) a decision of the Commissioner to bring an action under section 187; or

  (y) a decision of the Commissioner refusing to make a declaration under

section 243; or

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

or

 

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

or

Back to Top

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

or

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

or

  (zd) a decision of the Commissioner under section 335 to revoke an exemption

or declaration; or

  (ze) a decision of the Commissioner refusing to give a notice under

subsection 342(2) in relation to a fund; or

  (zf) a decision of the Commissioner to give a notice under subsection 342(6)

in relation to a fund;

  "spouse", in relation to a person, includes another person who, although not

legally married to the person, lives with the person on a genuine domestic

basis as the husband or wife of the person;

  "standard employer-sponsor" has the meaning given by subsection 16(2);

  "standard employer-sponsored fund" has the meaning given by subsection

16(4);

  "standard employer-sponsored member" has the meaning given by subsection

16(5);

  "statement", in Parts 18 and 19, includes a promise, estimate or forecast;

  "stop order" means an order under section 164;

  "Superannuation Complaints Tribunal" means the Superannuation Complaints

Tribunal established by the Superannuation (Resolution of Complaints) Act

1993;

  "superannuation entity" means:

  (a) a regulated superannuation fund; or

  (b) an approved deposit fund; or

  (c) a pooled superannuation trust;

  "superannuation entity affected by a reviewable decision", in relation to a

reviewable decision, means the superannuation entity in relation to which the

decision was made;

  "superannuation fund" means:

  (a) a fund that:

    (i) is an indefinitely continuing fund; and

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

fund; or

  (b) a public sector superannuation scheme;

  "superannuation interest" means a beneficial interest in a superannuation

entity;

  "superannuation standards officer" means a person who is or has been

appointed or employed by the Commonwealth and who, because of that appointment

or employment, or in the course of that employment:

  (a) may acquire, or has acquired, protected information; or

  (b) may have, or has had, access to protected documents;

and includes a person who is or has been an inspector;

  "taxation officer" means a person who is an officer for the purposes of

section 16 of the Income Tax Assessment Act;

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

  (a) if there is a trustee (within the ordinary meaning of that expression)

of the fund, scheme or trust-the trustee; or

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

  "unclaimed money" has the meaning given by subsection 225(1);

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

Act;

  "value" means market value, and includes amount;

  "year of income", in relation to a fund, scheme or trust, means a period

that is, for the purposes of the Income Tax Assessment Act, a year of income

of the fund scheme, or trust (subsection 6(2A) of that Act applies

accordingly).

 

  11. If:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 11

 

Approvals, determinations etc. by Commissioner

 

  (a) a provision of this Act refers to an approval given, determination made

or other act or thing done by the Commissioner; and

  (b) there is no other provision of this Act expressly authorising the

Commissioner to give the approval, make the determination or do the act or

thing;

the Commissioner is authorised to give the approval, make the determination or

do the act or thing.

 

  12.(1) The question whether a person is an associate of another person for

the purposes of this Act is to be determined in the same way as that question

would be determined under the Corporations Law if the assumptions set out in

subsection (2) were made.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 12

 

Associates

 

  (2) The assumptions are as follows:

  (a) that sections 12 and 14 and paragraphs 15(1)(b) and 16(1)(b) and (c) of

the Corporations Law had not been enacted;

  (b) that section 13 of the Corporations Law were not limited to Chapter 7,

 

but extended to all provisions of the Corporations Law.

Back to Top

 

  13. For the purposes of this Act:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 13

 

Single trustees and groups of trustees

 

  (a) a fund, scheme or trust has a single corporate trustee if, and only if,

there is only one trustee of the fund, scheme or trust and that trustee is a

corporate trustee; and

  (b) a fund, scheme or trust has a single individual trustee if, and only if,

there is only one trustee of the fund, scheme or trust and that trustee is an

individual trustee; and

  (c) a fund, scheme or trust has a group of 2 or more individual trustees if,

and only if, the fund, scheme or trust has 2 or more trustees and each trustee

is an individual.

 

  14. If the governing rules of a fund contain a provision the purpose of

which is to avoid a breach of a rule of law relating to perpetuities, that

provision does not prevent the fund from being treated as an indefinitely

continuing fund for the purposes of the definition of "approved deposit fund"

or "superannuation fund" in section 10.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 14

 

Indefinitely continuing fund-application of rules against perpetuities

 

 

  15.(1) For the purposes of paragraph (c) of the definition of "approved

purposes" in section 10, if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 15

 

Payments for purchase of annuities

 

  (a) an amount is deposited with an approved deposit fund; and

  (b) on the request of a beneficiary, the amount is paid by the fund to a

life insurance company or registered organisation for the purchase of an

annuity in the name of the beneficiary;

the amount is taken to be a repayment by the fund of the amount concerned to

the beneficiary on request.

  (2) A reference in subsection (1) to a beneficiary includes a reference to

the legal personal representative of a beneficiary.

 

  16.(1) An employer-sponsor of a regulated superannuation fund is an employer

who:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 16

 

Definitions associated with employer-sponsorship

Employer-sponsor

 

  (a) contributes to the fund; or

  (b) would, apart from a temporary cessation of contributions, contribute to

the fund;

for the benefit of:

  (c) a member of the fund who is an employee of:

    (i) the employer; or

    (ii) an associate of the employer; or

  (d) the dependants of such a member in the event of the death of the member.

Standard employer-sponsor

  (2) If an employer so contributes, or would contribute, wholly or partly

pursuant to an arrangement between the employer and the trustee of the

regulated superannuation fund concerned, the employer is a standard

employer-sponsor of the fund (as well as being an employer-sponsor of the

fund). If the employer only so contributes, or would contribute, pursuant to

arrangements between the employer and a member or members of the fund, the

employer is not a standard employer-sponsor.

Employer-sponsored fund

  (3) An employer-sponsored fund is a regulated superannuation fund that has

at least one employer-sponsor.

Standard employer-sponsored fund

  (4) If a regulated superannuation fund has at least one standard

employer-sponsor, the fund is a standard employer-sponsored fund (as well as

being an employer-sponsored fund).

Standard employer-sponsored member

  (5) A standard employer-sponsored member is a member of a regulated

superannuation fund in respect of whom an employer-sponsor contributes, or

would contribute, as mentioned in subsection (1) wholly or partly pursuant to

an arrangement between the employer-sponsor and the trustee of the fund.

 

  17. For the purposes of this Act, a person is involved in a contravention

if, and only if, the person:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 17

 

Persons involved in contravention

 

  (a) has aided, abetted, counselled or procured the contravention; or

  (b) has induced, whether by threats or promises or otherwise, the

contravention; or

  (c) has been in any way, by act or omission, directly or indirectly,

knowingly concerned in, or party to, the contravention; or

  (d) has conspired with others to effect the contravention.

 

  18.(1) A superannuation fund is a public offer superannuation fund if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 18

 

Public offer superannuation fund

Definition

 

  (a) one of the following subparagraphs applies to the fund:

 

    (i) it is a regulated superannuation fund that is not a

Back to Top

standard employer-sponsored fund;

    (ii) it is a standard employer-sponsored fund that has at

least one member:

      (A) who is not a standard employer-sponsored member; and

      (B) who is not a member of a prescribed class;

    (iii) it is a standard employer-sponsored fund in relation to

which an election under subsection (2) has been made;

    (iv) a declaration under subsection (6) (which allows for

funds to be declared to be public offer superannuation funds) is in force in

relation to the fund; and

  (b) no declaration under subsection (7) (which allows for funds to be

declared not to be public offer superannuation funds) is in force in relation

to the fund.

Election to be a public offer superannuation fund

  (2) The trustee of a standard employer-sponsored fund may elect that the

fund is to be treated as a public offer superannuation fund.

How an election is made

  (3) An election must be made by giving the Commissioner a written notice

that is:

  (a) in the approved form; and

  (b) under the common or official seal of the trustee.

Trustee has power to make election despite anything in the governing rules

  (4) The trustee has the power to make an election despite anything in the

governing rules of the fund.

Election is irrevocable

  (5) An election is irrevocable.

Declaration that fund is a public offer superannuation fund

  (6) The Commissioner may, in writing, declare a superannuation fund to be a

public offer superannuation fund.

Declaration that fund is not a public offer superannuation fund

  (7) The Commissioner may, in writing, declare a superannuation fund not to

be a public offer superannuation fund.

Commencement of declaration

  (8) A declaration comes into force when it is made, or, if a later time is

specified in the declaration as the time when it comes into force, it comes

into force at that later time.

Cessation of declaration

  (9) A declaration remains in force:

  (a) if a time is specified in the declaration as the time when it stops

being in force-until that time, or until the declaration is revoked, whichever

occurs first; or

  (b) otherwise-until the declaration is revoked.

Revocation of declaration

  (10) The Commissioner may, in writing, revoke a declaration.

Commissioner must have regard to guidelines when making or revoking a

declaration

  (11) When making or revoking a declaration, the Commissioner must have

regard to any written guidelines determined by the Commissioner under this

subsection.

Copy of declaration or revocation to be given to trustee

  (12) As soon as practicable after making or revoking a declaration, the

Commissioner must give the trustee of the superannuation fund concerned a copy

of the instrument making or revoking the declaration.

 

  19.(1) A regulated superannuation fund is a superannuation fund in respect

of which subsections (2) to (4) have been complied with.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 19

 

Regulated superannuation fund

Definition

 

Fund must have a trustee

  (2) The superannuation fund must have a trustee.

Trustee must be a constitutional corporation or fund must be a pension fund

  (3) Either of the following must apply:

  (a) the trustee of the fund must be a constitutional corporation pursuant to

a requirement contained in the governing rules;

  (b) the governing rules must provide that the sole or primary purpose of the

fund is the provision of old-age pensions.

Election by trustee

  (4) The trustee or trustees must have given to the Commissioner a written

notice in the approved form signed by the trustee or each trustee:

  (a) in the case of a corporate trustee-under its common or official seal;

or

  (b) in the case of an individual-by him or her;

electing that this Act is to apply in relation to the fund.

Election is irrevocable

  (5) An election made as mentioned in subsection (4) is irrevocable.

Trustee has power to make election despite anything in the governing rules

etc.

  (6) The trustee or trustees have the power to make an election as mentioned

in subsection (4) despite anything in the governing rules of the fund.

 

Certain funds must become regulated superannuation funds

Back to Top

  (7) If all of the following conditions are satisfied in relation to a

superannuation fund at any time during the period beginning on the day on

which this Act received the Royal Assent and ending at the end of the fund's

1993-94 year of income:

  (a) the fund has a trustee;

  (b) either:

    (i) the trustee of the fund is a constitutional corporation;

or

    (ii) the governing rules of the fund provide that the sole or

primary purpose of the fund is the provision of old-age pensions;

  (c) the fund is not a public sector superannuation scheme;

  (d) there is in force a notice under section 12 or 13 of the Occupational

Superannuation Standards Act 1987 stating that the Commissioner is satisfied

that the fund satisfied, or should be treated as if it had satisfied, the

superannuation fund conditions in relation to a particular year of income;

  (e) there is not in force a notice under section 12 or 13 of the

Occupational Superannuation Standards Act 1987 stating that the Commissioner

is not satisfied that the fund satisfied the superannuation fund conditions in

relation to a year of income later than the year of income mentioned in

paragraph (d);

the trustee of the fund must use its best endeavours to ensure that the fund

becomes a regulated superannuation fund at or before the beginning of the

fund's 1994-95 year of income.

Contravention of subsection (7) is not an offence

  (8) A contravention of subsection (7) is not an offence. However, a

contravention of subsection (7) is a ground for the grant of an injunction

under section 315.

References to repealed provisions of OSSA

  (9) A reference in this section to a provision of the Occupational

Superannuation Standards Act 1987 includes a reference to the provision as it

continues to apply, despite its repeal, because of the Occupational

Superannuation Standards Amendment Act 1993.

 

  20. The question whether bodies corporate are related to each other for the

purposes of this Act is to be determined in the same way as that question

would be determined under the Corporations Law.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 20

 

Related bodies corporate

 

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 2

 

 

  21.(1) The object of this Part is to provide for constitutional corporations

to be approved as trustees for the purposes of this Act.

                   PART 2-APPROVAL OF TRUSTEES

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 21

 

Object of Part

 

  (2) The significance of the approval of trustees is as follows:

  (a) a fund cannot be an approved deposit fund unless it is maintained by an

approved trustee (the other requirements of the definition of "approved

deposit fund" in section 10 must also be satisfied);

  (b) the trustee of a public offer entity must not engage in conduct to which

section 152 applies unless the trustee is an approved trustee (the other

requirements of subsection 152(2) must also be satisfied).

 

  22. In this Part:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 22

 

Interpretation

 

  "relevant entity" means:

  (a) a public offer entity; or

  (b) an approved deposit fund.

 

  23.(1) A constitutional corporation may apply to the Commissioner for an

approval as a trustee for the purposes of this Act.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 23

 

Application for approval

 

  (2) An application must:

  (a) be in the approved form; and

  (b) contain the information required by the form; and

  (c) be accompanied by an application fee of the prescribed amount.

 

  24. If the Commissioner needs further information to decide an application

for approval, the Commissioner may ask the applicant to provide the

information.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 24

 

Further information may be requested

 

 

  25.(1) Subject to this section, the Commissioner must decide an application

for approval within 60 days after receiving it.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 25

 

Period within which application for approval is to be decided

 

  (2) If the Commissioner thinks that it will take longer to decide the

application, the Commissioner may extend, by up to 60 days, the period for

deciding it.

  (3) An extension must be made by written notice given to the applicant

within 60 days after the Commissioner receives the application.

  (4) If the Commissioner makes an extension, the Commissioner must decide the

 

application within the extended period.

Back to Top

  (5) If the Commissioner has not decided the application by the end of the

day by which the Commissioner is required to decide it, the Commissioner is

taken to have decided, at the end of that day, to refuse the application.

 

  26.(1) The Commissioner must, in writing, approve an applicant as a trustee

for the purposes of this Act if, and only if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 26

 

Deciding an application for approval

 

  (a) the Commissioner is satisfied that the applicant can be relied on to

perform, in a proper manner, the duties of trustee of any relevant entity of

which the applicant is or becomes the trustee; and

  (b) at least one of the following subparagraphs applies:

    (i) the Commissioner is satisfied that the value of the net

tangible assets of the applicant is not less than the amount prescribed by the

regulations;

    (ii) the Commissioner is satisfied that the applicant is

entitled to the benefit of an approved guarantee of an amount not less than

the amount prescribed by the regulations, being a guarantee in respect of the

applicant's duties as trustee of each relevant entity of which the applicant

is, or is proposing to become, the trustee;

    (iii) the applicant has agreed to comply with the written

requirements given to the applicant by the Commissioner before the granting of

the approval, being requirements relating to the custody of the assets of a

relevant entity or relevant entities of which the applicant is or becomes the

trustee.

  (2) Otherwise, the Commissioner must, in writing, refuse the application.

  (3) The approval is subject to any conditions specified in the instrument of

approval.

  (4) If the Commissioner refuses the application, the Commissioner must set

out the reasons for the refusal in the instrument of refusal.

  (5) The Commissioner must cause the applicant to be given a copy of the

instrument of approval or refusal.

 

  27. An approval under section 26:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 27

 

When an approval is in force

 

  (a) comes into force when it is granted, or, if a later time is specified in

the instrument of approval as the time when the approval comes into force, at

that later time; and

  (b) remains in force until it is revoked under section 28.

 

  28.(1) The Commissioner may revoke the approval of an approved trustee by

written notice given to the trustee.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 28

 

Revocation of approval

 

  (2) Without limiting subsection (1), the Commissioner may revoke an approval

under that subsection if the Commissioner is satisfied, on reasonable grounds,

that:

  (a) there has been a contravention of any condition to which the approval is

subject; or

  (b) the trustee can no longer be relied on to perform, in a proper manner,

the duties of trustee of each relevant entity of which the trustee is the

trustee; or

  (c) if subparagraph 26(1)(b)(i) applied to the approval of the trustee-that

subparagraph has ceased to apply to the trustee; or

  (d) if subparagraph 26(1)(b)(ii) applied to the approval of the trustee-that

subparagraph has ceased to apply to the trustee; or

  (e) if subparagraph 26(1)(b)(iii) applied to the approval of the trustee-the

trustee has failed to comply with a requirement of the Commissioner under that

subparagraph.

  (3) The Commissioner must not make a decision under subsection (1) without

the written consent of the Minister.

 

  29.(1) An approved trustee must, as soon as practicable, and in any event

within 30 days, after becoming aware of an event referred to in subsection

(2), give the Commissioner a written notice setting out particulars of the

event.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 29

 

Notification of change in circumstances or breach of conditions

 

  (2) These are the events:

  (a) a contravention of a condition to which the approval of the trustee is

subject;

  (b) if subparagraph 26(1)(b)(i) applied to the approval of the trustee-that

subparagraph ceasing to apply to the trustee;

  (c) if subparagraph 26(1)(b)(ii) applied to the approval of the trustee-that

subparagraph ceasing to apply to the trustee;

  (d) if subparagraph 26(1)(b)(iii) applied to the approval of the trustee-the

trustee failing to comply with a requirement of the Commissioner under that

subparagraph.

  (3) An approved trustee must not, without reasonable excuse, contravene

subsection (1).

Penalty: 250 penalty units.



 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 3

 

     PART 3-OPERATING STANDARDS FOR SUPERANNUATION ENTITIES

 

 

  30. The object of this Part is to provide for a system of prescribed

standards applicable to the operation of regulated superannuation funds,

approved deposit funds and pooled superannuation trusts.


Back to Top

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 30

 

Object of Part

 

 

  31.(1) The regulations may prescribe standards applicable to the operation

of regulated superannuation funds ("funds").

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 31

 

Operating standards for regulated superannuation funds

 

  (2) The standards that may be prescribed include, but are not limited to,

standards relating to the following matters:

  (a) the persons who may contribute to funds;

  (b) the vesting in beneficiaries in funds of benefits arising directly or

indirectly from amounts contributed to the funds;

  (c) the amount of contributions that a fund may accept;

  (d) the circumstances in which a fund may accept contributions;

  (e) the form in which benefits may be provided by funds;

  (f) the actuarial standards that will apply to funds;

  (g) the preservation of benefits arising directly or indirectly from amounts

contributed to funds;

  (h) the payment by funds of benefits arising directly or indirectly from

amounts contributed to the funds;

  (i) the portability of benefits arising directly or indirectly from amounts

contributed to funds;

  (j) the levels of benefits that may be provided by funds and the levels of

assets that may be held by funds;

  (k) the application by funds of money no longer required to meet payments of

benefits to beneficiaries because the beneficiaries have ceased to be entitled

to receive those benefits;

  (l) the investment of assets of funds;

  (m) the number of trustees, and the composition of boards or committees of

trustees, of funds;

  (n) the keeping and retention of records in relation to funds;

  (o) the financial and actuarial reports to be prepared in relation to

funds;

  (p) the disclosure of information to beneficiaries in funds;

  (q) the disclosure of information about funds to the Commissioner;

  (r) the disclosure of information about funds to persons other than

beneficiaries or the Commissioner;

  (s) the financial position of funds;

  (t) the funding and solvency of funds;

  (u) the winding-up of funds.

 

  32.(1) The regulations may prescribe standards applicable to the operation

of approved deposit funds ("funds").

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 32

 

Operating standards for approved deposit funds

 

  (2) The standards that may be prescribed include, but are not limited to,

standards relating to the following matters:

  (a) the kinds of amounts that may be deposited with funds;

  (b) the preservation of amounts deposited with funds, and of earnings on

such amounts;

  (c) the payment out of funds of amounts deposited with the funds, and of

earnings on such amounts;

  (d) the portability of amounts deposited with funds, and of earnings on such

amounts;

  (e) the form in which benefits may be paid out of funds;

  (f) the investment of assets of funds;

  (g) the keeping and retention of records in relation to funds;

  (h) the financial and actuarial reports to be prepared in relation to

funds;

  (i) the disclosure of information to beneficiaries in funds;

  (j) the disclosure of information about funds to the Commissioner;

  (k) the disclosure of information about funds to persons other than

beneficiaries or the Commissioner;

  (l) the financial position of funds;

  (m) the funding and solvency of funds;

  (n) the winding-up of funds.

 

  33.(1) The regulations may prescribe standards applicable to the operation

of pooled superannuation trusts ("trusts").

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 33

 

Operating standards for pooled superannuation trusts

 

  (2) The standards that may be prescribed include, but are not limited to,

standards relating to the following matters:

  (a) the ownership and disposal of units in trusts;

  (b) the investment of assets of trusts;

  (c) the persons who may be trustees of trusts;

  (d) the number of trustees, and the composition of boards or committees of

trustees, of trusts;

  (e) the keeping and retention of records in relation to trusts;

 

  (f) the financial and actuarial reports to be prepared in relation to

trusts;

Back to Top

  (g) the disclosure of information to unit-holders in trusts;

  (h) the disclosure of information about trusts to the Commissioner;

  (i) the disclosure of information about trusts to persons other than

unit-holders or the Commissioner;

  (j) the financial position of trusts;

  (k) the funding and solvency of trusts.

 

  34.(1) The trustee of a superannuation entity must ensure that the

prescribed standards applicable to the operation of the entity are complied

with at all times.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 34

 

Prescribed operating standards must be complied with

Standards must be complied with

 

Offence

  (2) A person who intentionally or recklessly contravenes subsection (1) is

guilty of an offence punishable on conviction by a fine not exceeding 100

penalty units.

Validity of transaction not affected by contravention of (1)

  (3) A contravention of subsection (1) does not affect the validity of a

transaction.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 4

 

 

  35. The object of this Part is to require the trustee of a superannuation

entity to lodge an annual return with the Commissioner.

      PART 4-TRUSTEE OF SUPERANNUATION ENTITY TO LODGE ANNUAL

                  RETURNS WITH THE COMMISSIONER

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 35

 

Object of Part

 

 

  36.(1) The trustee of a superannuation entity must, within the prescribed

period after each year of income, give to the Commissioner:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 36

 

Trustee to lodge annual returns

Lodgment

 

  (a) a return, in the approved form, containing such information as is

required by that form in relation to the entity in respect of that year of

income; and

  (b) a certificate, in the approved form, by the trustee in relation to the

entity in respect of that year of income; and

  (c) the certificate given to the trustee by an approved auditor under Part

13 in relation to the entity in respect of that year of income.

Offence

  (2) A person who intentionally or recklessly contravenes subsection (1) is

guilty of an offence punishable on conviction by a fine not exceeding 50

penalty units.

Data processing devices

  (3) An approval given by the Commissioner of a form of return for the

purposes of paragraph (1)(a) may require or permit the return to be given on a

specified kind of data processing device in accordance with specified software

requirements.

Endorsement of certificates

  (4) If the return is given otherwise than on a data processing device, a

certificate referred to in paragraph (1)(b) or (c) may be endorsed on the

return.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 5

 

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 1

 

 

  37. The objects of this Part are:

          PART 5-NOTICES ABOUT COMPLYING FUND STATUS

 

           Division 1-Objects and interpretation

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 37

 

Objects of Part

 

  (a) to provide for a system of notices about complying fund status in

relation to a year of income (see Division 2); and

  (b) to provide for those notices to be used to determine complying fund

status for tax purposes (see Division 3).

 

  38. In this Part:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 38

 

Meaning of "entity"

 

  "entity" means a fund, scheme or trust.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 2

 

 

  39.(1) For the purposes of this Division, a contravention of this Act (other

than Part 9) or the regulations is to be ignored unless the contravention is:

         Division 2-Commissioner may give notices about

                     complying fund status

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 39

 

Meaning of "contravention"

 

  (a) an offence; or

  (b) a contravention of a civil penalty provision.

  (2) For the purposes of this Division, it is sufficient if a contravention

is established on the balance of probabilities.



Notice about complying fund status

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 40

 

Notices by Commissioner to trustee

 

  40.(1) The Commissioner may give a written notice to the trustee of an

entity stating:


Back to Top

  (a) whether the entity is or is not a complying superannuation fund; or

  (b) whether the entity is or is not a complying approved deposit fund; or

  (c) whether the entity is or is not a pooled superannuation trust;

as the case may be, in relation to a year of income specified in the notice.

Reasons

  (2) If the Commissioner gives a notice to the trustee of an entity stating

that:

  (a) the entity is not a complying superannuation fund; or

  (b) the entity is not a complying approved deposit fund; or

  (c) the entity is not a pooled superannuation trust;

as the case may be, in relation to a year of income, the notice must set out

the reasons why the Commissioner so stated.

Commissioner of Taxation to be told about notice

  (3) When the Commissioner gives a notice under this section, the

Commissioner must give particulars of the notice to the Commissioner of

Taxation.

Revocation

  (4) If:

  (a) the Commissioner gives a notice under this section (the "original

notice") to the trustee of an entity stating that:

    (i) the entity is a complying superannuation fund; or

    (ii) the entity is a complying approved deposit fund; or

    (iii) the entity is a pooled superannuation trust;

as the case may be, in relation to a year of income; and

  (b) the Commissioner subsequently gives a notice under this section (the

"second notice") to the trustee of the entity stating that:

    (i) the entity is not a complying superannuation fund; or

    (ii) the entity is not a complying approved deposit fund; or

    (iii) the entity is not a pooled superannuation trust;

as the case may be, in relation to the year of income;

the second notice is taken to revoke the original notice.

 

  41.(1) Except as provided by subsection (2), the Commissioner is not obliged

to give a notice under section 40.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 41

 

When Commissioner obliged to give notice of compliance

 

  (2) The Commissioner must give a notice under section 40 to the trustee of

an entity stating that the entity is a complying superannuation fund, a

complying approved deposit fund or a pooled superannuation trust, as the case

may be, in relation to a year of income (the "current year of income") if:

  (a) the entity is a complying superannuation fund, a complying approved

deposit fund or a pooled superannuation trust, as the case requires, in

relation to the current year of income; and

  (b) either:

    (i) the Commissioner has not given a notice to the trustee

under section 40 stating that the entity is a complying superannuation fund, a

complying approved deposit fund or a pooled superannuation trust, as the case

requires, in relation to a previous year of income; or

    (ii) both:

      (A) the Commissioner has given a notice to the trustee

under section 40 stating that the entity is not a complying superannuation

fund, is not a complying approved deposit fund or is not a pooled

superannuation trust, as the case requires, in relation to a previous year of

income; and

      (B) the Commissioner has not given a notice to the trustee

under section 40 stating that the fund is a complying superannuation fund, a

complying approved deposit fund or a pooled superannuation trust, as the case

requires, in relation to a year of income that is later than that previous

year of income and earlier than the current year of income.

  (3) Despite section 2, a previous year mentioned in subsection (2) may be a

year of income earlier than the 1994-95 year of income (see section 49).

However, despite section 49, for the purposes of the application of subsection

(2) to a complying superannuation fund, if the fund was not a regulated

superannuation fund at all times during the current year of income when the

fund was in existence, paragraph (2)(b) does not apply unless the previous

year of income is the 1994-95 year of income or a later year of income.

  (4) For the purposes of this section, if a notice under section 40 is

revoked, or the decision to give the notice is set aside, the notice is taken

never to have been given.

 

  42.(1) An entity is a complying superannuation fund in relation to a year of

income for the purposes of this Division if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 42

 

Complying superannuation fund

 

  (a) at all times during the year of income when the entity was in existence,

the entity was a regulated superannuation fund; and

  (b) any of the following conditions is satisfied:

    (i) the trustee did not contravene this Act or the

 

regulations in relation to the entity in respect of the year of income;

Back to Top

    (ii) both:

      (A) the trustee contravened this Act or the regulations in

relation to the entity in respect of the year of income on one or more

occasions; and

      (B) each contravention was rectified within a period of

30 days after the trustee became aware of the contravention or within such

further period as the Commissioner allows;

    (iii) both:

      (A) the trustee contravened this Act or the regulations in

relation to the entity in respect of the year of income on one or more

occasions; and

      (B) the Commissioner is satisfied that the seriousness or

frequency, or both, of the contraventions does not warrant the giving of a

notice stating that the entity is not a complying superannuation fund in

relation to the year of income;

    (iv) the Commissioner, after considering all relevant

circumstances, thinks that a notice should be given stating that the entity is

a complying superannuation fund in relation to the year of income.

  (2) For the purposes of subsection (1), if a fund does not comply with Part

9 (which deals with equal representation) at any time during the year of

income, the trustee of the fund is taken to have contravened this Act in

relation to the fund in respect of the year of income.

 

  43. An entity is a complying approved deposit fund in relation to a year of

income for the purposes of this Division if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 43

 

Complying approved deposit fund

 

  (a) at all times during the year of income when the entity was in existence,

the entity was an approved deposit fund; and

  (b) any of the following conditions is satisfied:

    (i) the trustee did not contravene this Act or the

regulations in relation to the entity in respect of the year of income;

    (ii) both:

      (A) the trustee contravened this Act or the regulations in

relation to the entity in respect of the year of income on one or more

occasions; and

      (B) each contravention was rectified within a period of

30 days after the trustee became aware of the contravention or within such

further period as the Commissioner allows;

    (iii) both:

      (A) the trustee contravened this Act or the regulations in

relation to the entity in respect of the year of income on one or more

occasions; and

      (B) the Commissioner is satisfied that the seriousness or

frequency, or both, of the contraventions does not warrant the giving of a

notice stating that the entity is not a complying approved deposit fund in

relation to the year of income;

    (iv) the Commissioner, after considering all relevant

circumstances, thinks that a notice should be given stating that the entity is

a complying approved deposit fund in relation to the year of income.

 

  44. An entity is a pooled superannuation trust in relation to a year of

income for the purposes of this Division if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 44

 

Pooled superannuation trust

 

  (a) at all times during the year of income when the entity was in existence,

the entity was a pooled superannuation trust; and

  (b) any of the following conditions is satisfied:

    (i) the trustee did not contravene this Act or the

regulations in relation to the entity in respect of the year of income;

    (ii) both:

      (A) the trustee contravened this Act or the regulations in

relation to the entity in respect of the year of income on one or more

occasions; and

      (B) each contravention was rectified within a period of

30 days after the trustee became aware of the contravention or such further

period as the Commissioner allows;

    (iii) both:

      (A) the trustee contravened this Act or the regulations in

relation to the entity in respect of the year of income on one or more

occasions; and

      (B) the Commissioner is satisfied that the seriousness or

frequency, or both, of the contraventions does not warrant the giving of a

notice stating that the entity is not a pooled superannuation trust in

relation to the year of income;

    (iv) the Commissioner, after considering all relevant

circumstances, thinks that a notice should be given stating that the entity is

a pooled superannuation trust in relation to the year of income.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 3

 



 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 45

 

Complying superannuation fund

 

  45.(1) A fund is a complying superannuation fund for the purposes of Part IX

of the Income Tax Assessment Act in relation to a year of income (the "current

year of income") if, and only if:

         Division 3-Complying fund status for tax purposes

 


Back to Top

  (a) the Commissioner has given a notice to the trustee under section 40

stating that the fund is a complying superannuation fund in relation to the

current year of income; or

  (b) the Commissioner has given a notice to the trustee under section 40

stating that the fund is a complying superannuation fund in relation to a

previous year of income and has not given a notice to the trustee under that

section stating that the fund was not a complying superannuation fund in

relation to:

    (i) the current year of income; or

    (ii) a year of income that is:

      (A) later than that previous year of income; and

      (B) earlier than the current year of income.

  (2) Despite section 2, the previous year mentioned in paragraph (1)(b) may

be a year of income earlier than the 1994-95 year of income (see section 49).

However, despite section 49, if the fund was not a regulated superannuation

fund at all times during the current year of income when the fund was in

existence, paragraph (1)(b) does not apply unless the previous year of income

is the 1994-95 year of income or a later year of income.

  (3) For the purposes of this section, if a notice under section 40 is

revoked, or the decision to give the notice is set aside, the notice is taken

never to have been given.

  (4) Section 170 of the Income Tax Assessment Act does not prevent the

amendment of an assessment at any time for the purposes of giving effect to

subsection (3).

  (5) For the purposes of this section, if a notice under section 40 is given

in relation to a fund in relation to a year of income, the notice is taken to

have been given at the beginning of the year of income.

  (6) Despite subsection (1), if, at all times during a year of income when a

fund was in existence, the fund was, or was part of, an exempt public sector

superannuation scheme, the fund is a complying superannuation fund in relation

to the year of income for the purposes of Part IX of the Income Tax Assessment

Act.

 

  46. An exempt public sector superannuation scheme is taken to be a complying

superannuation scheme for the purposes of the Superannuation Guarantee

(Administration) Act 1992.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 46

 

Complying superannuation scheme-superannuation guarantee charge

 

 

  47.(1) A fund is a complying approved deposit fund for the purposes of Part

IX of the Income Tax Assessment Act in relation to a year of income (the

"current year of income") if, and only if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 47

 

Complying approved deposit fund

 

  (a) the Commissioner has given a notice to the trustee under section 40

stating that the fund is a complying approved deposit fund in relation to the

current year of income; or

  (b) the Commissioner has given a notice to the trustee under section 40

stating that the fund is a complying approved deposit fund in relation to a

previous year of income and has not given a notice to the trustee under that

section stating that the fund was not a complying approved deposit fund in

relation to:

    (i) the current year of income; or

    (ii) a year of income that is:

      (A) later than that previous year of income; and

      (B) earlier than the current year of income.

  (2) Despite section 2, the previous year mentioned in paragraph (1)(b) may

be a year of income earlier than the 1994-95 year of income (see section 49).

  (3) For the purposes of this section, if a notice under section 40 is

revoked, or the decision to give the notice is set aside, the notice is taken

never to have been given.

  (4) Section 170 of the Income Tax Assessment Act does not prevent the

amendment of an assessment at any time for the purposes of giving effect to

subsection (3).

  (5) For the purposes of this section, if a notice under section 40 is given

in relation to a fund in relation to a year of income, the notice is taken to

have been given at the beginning of the year of income.

 

  48.(1) A unit trust is a pooled superannuation trust for the purposes of

Part IX of the Income Tax Assessment Act in relation to a year of income (the

"current year of income") if, and only if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 48

 

Pooled superannuation trust

 

  (a) the Commissioner has given a notice to the trustee under section 40

stating that the trust is a pooled superannuation trust in relation to the

current year of income; or

  (b) the Commissioner has given a notice to the trustee under section 40

stating that the trust is a pooled superannuation trust in relation to a

previous year of income and has not given a notice to the trustee under that

 

section stating that the trust was not a pooled superannuation trust in

relation to:

Back to Top

    (i) the current year of income; or

    (ii) a year of income that is:

      (A) later than that previous year of income; and

      (B) earlier than the current year of income.

  (2) Despite section 2, the previous year mentioned in paragraph (1)(b) may

be a year of income earlier than the 1994-95 year of income (see section 49).

  (3) For the purposes of this section, if a notice under section 40 is

revoked, or the decision to give the notice is set aside, the notice is taken

never to have been given.

  (4) Section 170 of the Income Tax Assessment Act does not prevent the

amendment of an assessment at any time for the purposes of giving effect to

subsection (3).

  (5) For the purposes of this section, if a notice under section 40 is given

in relation to a trust in relation to a year of income, the notice is taken to

have been given at the beginning of the year of income.

 

  49.(1) For the purposes of paragraph 41(2)(b) and this Division, if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 49

 

Transitional-notices under the repealed provisions of the

Occupational Superannuation Standards Act 1987

Superannuation funds-positive

 

  (a) a notice under repealed section 12 or 13 of the Occupational

Superannuation Standards Act 1987 stated that the Commissioner is satisfied

that:

    (i) a fund satisfied the superannuation fund conditions in

relation to a year of income; or

    (ii) a fund should be treated as if it had satisfied the

superannuation fund conditions in relation to a year of income; and

  (b) the year of income is the 1993-94 year of income or an earlier year of

income;

the notice has effect as if it were a notice under section 40 stating that the

fund is a complying superannuation fund in relation to the year of income.

ADFs-positive

  (2) For the purposes of paragraph 41(2)(b) and this Division, if:

  (a) a notice under repealed section 14 or 15 of the Occupational

Superannuation Standards Act 1987 stated that the Commissioner is satisfied

that:

    (i) a fund satisfied the approved deposit fund conditions in

relation to a year of income; or

    (ii) a fund should be treated as if it had satisfied the

approved deposit fund conditions in relation to a year of income; and

  (b) the year of income is the 1993-94 year of income or an earlier year of

income;

the notice has effect as if it were a notice under section 40 stating that the

fund is a complying approved deposit fund in relation to the year of income.

PSTs-positive

  (3) For the purposes of paragraph 41(2)(b) and this Division, if:

  (a) a notice under repealed section 15B or 15C of the Occupational

Superannuation Standards Act 1987 stated that the Commissioner is satisfied

that:

    (i) a trust satisfied the pooled superannuation trust

conditions in relation to a year of income; or

    (ii) a trust should be treated as if it had satisfied the

pooled superannuation trust conditions in relation to a year of income; and

  (b) the year of income is the 1993-94 year of income or an earlier year of

income;

the notice has effect as if it were a notice under section 40 stating that the

trust is a pooled superannuation trust in relation to the year of income.

Superannuation funds-negative

  (4) For the purposes of paragraph 41(2)(b) and this Division, if:

  (a) a notice under the repealed section 12 or 13 of the Occupational

Superannuation Standards Act 1987 stated that the Commissioner is not

satisfied that a fund satisfied the superannuation fund conditions in relation

to a year of income; and

  (b) the year of income is the 1993-94 year of income or an earlier year of

income;

the notice has effect as if it were a notice under section 40 stating that the

fund is not a complying superannuation fund in relation to the year of income.

ADFs-negative

  (5) For the purposes of paragraph 41(2)(b) and this Division, if:

  (a) a notice under the repealed section 14 or 15 of the Occupational

Superannuation Standards Act 1987 stated that the Commissioner is not

satisfied that a fund satisfied the approved deposit fund conditions in

relation to a year of income; and

  (b) the year of income is the 1993-94 year of income or an earlier year of

income;

the notice has effect as if it were a notice under section 40 stating that the

fund is not a complying approved deposit fund in relation to the year of

income.

 

PSTs-negative

Back to Top

  (6) For the purposes of paragraph 41(2)(b) and this Division, if:

  (a) a notice under the repealed section 15B or 15C of the Occupational

Superannuation Standards Act 1987 stated that the Commissioner is not

satisfied that a trust satisfied the pooled superannuation trust conditions in

relation to a year of income; and

  (b) the year of income is the 1993-94 year of income or an earlier year of

income;

the notice has effect as if it were a notice under section 40 stating that the

trust is not a pooled superannuation trust in relation to the year of income.

OSSA-continued operation

  (7) A reference in this section to a provision of the Occupational

Superannuation Standards Act 1987 includes a reference to that provision as it

continues to apply, despite its repeal, because of the Occupational

Superannuation Standards Amendment Act 1993.

 

  50.(1) For the purposes of subsection 41(3), paragraph 42(1)(a) and

subsection 45(2), if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 50

 

Transitional-late lodgment of elections by trustees of superannuation funds

28 days late

 

  (a) on a particular day (the "lodgment day"), the trustee of a

superannuation fund lodges an election under section 19; and

  (b) the lodgment day is after the end of the fund's 1993-94 year of income

and before 29 July 1994; and

  (c) under the regulations, the fund is treated as if it had satisfied the

transitional superannuation fund conditions at all times during the period

(the "pre-lodgment period"):

    (i) beginning at the beginning of the fund's 1994-95 year of

income; and

    (ii) ending at the end of the lodgment day;

the fund is taken to be a regulated superannuation fund at all times during

the pre-lodgment period.

Excluded superannuation funds

  (2) For the purposes of subsection 41(3), paragraph 42(1)(a) and subsection

45(2), if:

  (a) on a particular day (the "lodgment day"), the trustee of an excluded

superannuation fund lodges an election under section 19; and

  (b) the lodgment day is after the end of the fund's 1993-94 year of income

and before whichever is the earlier of:

    (i) 1 January 1995; or

    (ii) the beginning of the fund's 1995-96 year of income; and

  (c) under the regulations, the fund is treated as if it had satisfied the

transitional superannuation fund conditions at all times during the period

(the "pre-lodgment period"):

    (i) beginning at the beginning of the fund's 1994-95 year of

income; and

    (ii) ending at the end of the lodgment day;

the fund is taken to be a regulated superannuation fund at all times during

the pre-lodgment period.

Public sector superannuation schemes

  (3) For the purposes of subsection 41(3), paragraph 42(1)(a) and subsection

45(2), if:

  (a) on a particular day (the "lodgment day"), the trustee of a

superannuation fund, being a public sector superannuation scheme, lodges an

election under section 19; and

  (b) the lodgment day is after the end of the fund's 1993-94 year of income

and before:

    (i) 1 July 1995; or

    (ii) such later date as the Commissioner allows; and

  (c) under the regulations, the fund is treated as if it had satisfied the

transitional superannuation fund conditions at all times during the period

(the "pre-lodgment period"):

    (i) beginning at the beginning of the fund's 1994-95 year of

income; and

    (ii) ending at the end of the lodgment day;

the fund is taken to be a regulated superannuation fund at all times during

the pre-lodgment period.

Special circumstances

  (4) For the purposes of subsection 41(3), paragraph 42(1)(a) and subsection

45(2), if:

  (a) on a particular day (the "lodgment day"), the trustee of a

superannuation fund lodges an election under section 19; and

  (b) the lodgment day is:

    (i) after 28 July 1994; and

    (ii) before whichever is the earlier of:

      (A) 1 January 1995; or

      (B) the beginning of the fund's 1995-96 year of income; and

  (c) the trustee satisfies the Commissioner that, because of special

circumstances, this subsection should apply in relation to the fund; and

  (d) the trustee has complied with such requirements relating to notifying

 

members of the fund about:

Back to Top

    (i) the delay in lodging the election; and

    (ii) the reasons for the delay in lodging the election;

as are specified in regulations made for the purposes of this paragraph; and

  (e) under the regulations, the fund is treated as if it had satisfied the

transitional superannuation fund conditions at all times during the period

(the "pre-lodgment period"):

    (i) beginning at the beginning of the fund's 1994-95 year of

income; and

    (ii) ending at the end of the lodgment day;

the fund is taken to be a regulated superannuation fund at all times during

the pre-lodgment period.

Regulations may apply OSS system

  (5) Regulations made for the purposes of paragraph (1)(c), (2)(c), (3)(c) or

(4)(e) may:

  (a) confer functions or powers on the Commissioner; and

  (b) make provision for or in relation to a matter by applying, adopting or

incorporating, with such modifications as are prescribed, the provisions, or

the repealed provisions, of:

    (i) the Occupational Superannuation Standards Act 1987; or

    (ii) regulations made for the purposes of section 7 of that

Act;

(including those provisions as they continue to apply, despite their repeal,

because of the Occupational Superannuation Standards Amendment Act 1993).

Section 49A of the Acts Interpretation Act 1901

  (6) Subsection (5) of this section does not limit the application of section

49A of the Acts Interpretation Act 1901 to regulations made for the purposes

of this section.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 6

 

 

  51. The object of this Part is to set out rules about the content of the

governing rules of superannuation entities.<

 

  52.(1) If the governing rules of a superannuation entity do not contain

covenants to the effect of the covenants set out in subsection (2), those

governing rules are taken to contain covenants to that effect.

       PART 6-PROVISIONS RELATING TO GOVERNING RULES OF

                  SUPERANNUATION ENTITIES

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 51

 

Object of Part

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 52

 

Covenants to be included in governing rules

Governing rules taken to contain covenants

 

The covenants

  (2) The covenants referred to in subsection (1) are the following covenants

by the trustee:

  (a) to act honestly in all matters concerning the entity;

  (b) to exercise, in relation to all matters affecting the entity, the same

degree of care, skill and diligence as an ordinary prudent person would

exercise in dealing with property of another for whom the person felt morally

bound to provide;

  (c) to ensure that the trustee's duties and powers are performed and

exercised in the best interests of the beneficiaries;

  (d) to keep the money and other assets of the entity separate from any money

and assets, respectively:

    (i) that are held by the trustee personally; or

    (ii) that are money or assets, as the case may be, of a

standard employer-sponsor, or an associate of a standard employer-sponsor, of

the entity;

  (e) not to enter into any contract, or do anything else, that would prevent

the trustee from, or hinder the trustee in, properly performing or exercising

the trustee's functions and powers;

  (f) to formulate and give effect to an investment strategy that has regard

to the whole of the circumstances of the entity including, but not limited to,

the following:

    (i) the risk involved in making, holding and realising, and

the likely return from, the entity's investments having regard to its

objectives and its expected cash flow requirements;

    (ii) the composition of the entity's investments as a whole

including the extent to which the investments are diverse or involve the

entity in being exposed to risks from inadequate diversification;

    (iii) the liquidity of the entity's investments having regard

to its expected cash flow requirements;

    (iv) the ability of the entity to discharge its existing and

prospective liabilities;

  (g) if there are any reserves of the entity-to formulate and to give effect

to a strategy for their prudential management, consistent with the entity's

investment strategy and its capacity to discharge its liabilities (whether

actual or contingent) as and when they fall due;

  (h) to allow a beneficiary access to any prescribed information or any

prescribed documents.

Covenant referred to in paragraph (2)(e)

 

  (3) A covenant referred to in paragraph (2)(e) does not prevent the trustee

from engaging or authorising persons to do acts or things on behalf of the

trustee.

Back to Top

Covenant referred to in paragraph (2)(f)

  (4) An investment strategy is taken to be in accordance with paragraph

(2)(f) even if it provides for a specified beneficiary or a specified class of

beneficiaries to give directions to the trustee, where:

  (a) the directions relate to the strategy to be followed by the trustee in

relation to the investment of a particular asset or assets of the entity; and

  (b) the directions are given in circumstances covered by regulations made

for the purposes of this paragraph.

Regulations may prescribe other covenants

  (5) The regulations may prescribe a covenant to be included in the governing

rules of a superannuation entity and, if the governing rules of such a

superannuation entity do not contain a covenant to the effect of the

prescribed covenant, those rules are taken to contain a covenant to that

effect.

Prescribed covenants may overlap with other requirements

  (6) Without limiting the generality of subsection (5), the regulations may

prescribe, for the purposes of that subsection, a covenant that elaborates,

supplements, or otherwise deals with, any aspect of:

  (a) a matter to which a covenant in subsection (2) relates; or

  (b) a matter to which a provision of this Act (other than this section)

relates.

But prescribed covenants must be capable of operating concurrently with other

requirements

  (7) However, a covenant prescribed for the purposes of subsection (5) must

be capable of operating concurrently with:

  (a) all the covenants referred to in subsection (2); and

  (b) this Act other than this section.

Covenant by corporate trustee has effect as covenant by trustee's directors

  (8) A covenant by a corporate trustee of a superannuation entity that is to

the effect of a covenant referred to in subsection (2), or to the effect of a

covenant prescribed by regulations referred to in subsection (5), also

operates as a covenant by each of the directors of the trustee to exercise a

reasonable degree of care and diligence for the purposes of ensuring that the

trustee carries out the first-mentioned covenant, and so operates as if the

directors were parties to the governing rules.

Reasonable degree of care and diligence

  (9) The reference in subsection (8) to a reasonable degree of care and

diligence is a reference to the degree of care and diligence that a reasonable

person in the position of director of the trustee would exercise in the

trustee's circumstances.

 

  53.(1) If the governing rules of an approved deposit fund (other than an

excluded approved deposit fund) do not contain covenants to the effect of

those set out in subsection (2), they are taken to contain covenants to that

effect.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 53

 

Covenants to repay amounts to beneficiaries in approved deposit funds

Governing rules to contain 2 covenants

 

Content of the covenants

  (2) The covenants are:

  (a) that, if a beneficiary, by written notice given to the trustee, requests

the trustee to pay to the beneficiary an amount equal to the beneficiary's

interest in the fund, the trustee will pay that amount within a period (not

being more than 12 months) determined by the trustee; and

  (b) that each director of the trustee will ensure that the trustee gives

effect to the covenant in paragraph (a).

Directors taken to be parties to governing rules

  (3) The covenant in paragraph (2)(b) has effect as if each director were a

party to the governing rules.

Period for payments to beneficiaries

  (4) The trustee is to determine the period within which amounts are to be

paid to beneficiaries under the covenant referred to in paragraph (2)(a).

Variation of payment period

  (5) When the trustee has determined the period under subsection (4), the

trustee may make a further determination varying that period if, and only if:

  (a) the Commissioner has consented in writing to the variation; or

  (b) the requirements of section 54 have been complied with.

 

  54.(1) The requirements referred to in paragraph 53(5)(b) are as follows:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 54

 

Prerequisites to variation of repayment period

 

  (a) the question whether the variation should be made has been voted on at a

meeting of the beneficiaries;

  (b) the trustee convened the meeting by sending by post, to the last-known

address of each of the beneficiaries, at least 21 days before the meeting, a

notice that set out:

    (i) the date, time and place of the meeting; and

    (ii) the reason for convening the meeting;

  (c) the beneficiaries who, at the meeting, vote (whether in person or by

 

proxy) on the question hold interests equal in value to at least the

prescribed percentage of the total value of all the interests in the fund;

Back to Top

  (d) the prescribed percentage of the beneficiaries who voted on the question

cast their votes in favour of making the variation.

  (2) For the purposes of paragraph (1)(c), the value of an interest is the

price at which the trustee would have to make a payment in respect of the

interest if the trustee were required to do so, under the covenant referred to

in section 53, on the day immediately before the day when the meeting is held.

 

  55.(1) A person must not contravene a covenant contained, or taken to be

contained, in the governing rules of a superannuation entity.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 55

 

Consequences of contravention of covenant

 

  (2) A contravention of subsection (1) is not an offence and a contravention

of that subsection does not result in the invalidity of a transaction.

  (3) A person who suffers loss or damage as a result of conduct of another

person that was engaged in in contravention of subsection (1) may recover the

amount of the loss or damage by action against that other person or against

any person involved in the contravention.

  (4) An action under subsection (3) may be begun at any time within 6 years

after the day on which the cause of action arose.

  (5) It is a defence to an action for loss or damage suffered by a person as

a result of the making of an investment by or on behalf of the trustee of a

superannuation entity if the defendant establishes that the investment was

made in accordance with an investment strategy formulated under a covenant

referred to in paragraph 52(2)(f).

  (6) It is a defence to an action for loss or damage suffered by a person as

a result of the management of any reserves by the trustee of a superannuation

entity if the defendant establishes that the management of the reserves was in

accordance with a covenant referred to in paragraph 52(2)(g).

  (7) Subsections (5) and (6) apply to an action for loss or damage, whether

brought under subsection (3) or otherwise.

 

  56.(1) A provision in the governing rules of a superannuation entity is void

if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 56

 

Indemnification of trustee from assets of entity

 

  (a) it purports to preclude the trustee from being indemnified out of the

assets of the entity in respect of any liability incurred while acting as

trustee of the entity; or

  (b) subject to subsection (2), it limits the amount of such an indemnity.

  (2) A provision in the governing rules of a superannuation entity is void in

so far as it would have the effect of exempting the trustee from, or

indemnifying the trustee against:

  (a) liability for breach of trust if the trustee:

    (i) fails to act honestly in a matter concerning the entity;

or

    (ii) intentionally or recklessly fails to exercise, in

relation to a matter affecting the entity, the degree of care and diligence

that the trustee was required to exercise; or

  (b) liability for a monetary penalty under a civil penalty order.

  (3) Nothing in the governing rules of a superannuation entity prohibits the

trustee of the entity from seeking advice from any person in respect of any

matter relating to performance of the duties or the exercise of the powers of

the trustee. A provision in the governing rules that purports to preclude the

trustee from being indemnified out of assets of the entity in respect of the

cost of obtaining such advice, or to limit the amount of such an indemnity, is

void.

 

  57.(1) Subject to subsection (2), the governing rules of a superannuation

entity may provide for a director of the trustee to be indemnified out of the

assets of the entity in respect of a liability incurred while acting as a

director of the trustee.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 57

 

Indemnification of directors of trustee from assets of entity

 

  (2) A provision of the governing rules of a superannuation entity is void in

so far as it would have the effect of indemnifying a director of the trustee

against:

  (a) a liability that arises because the director:

    (i) fails to act honestly in a matter concerning the entity;

or

    (ii) intentionally or recklessly fails to exercise, in

relation to a matter affecting the entity, the degree of care and diligence

that the director is required to exercise; or

  (b) liability for a monetary penalty under a civil penalty order.

  (3) A director of the trustee of a superannuation entity may be indemnified

out of the assets of the entity in accordance with provisions of the entity's

governing rules that comply with this section.

  (4) This section has effect despite section 241 of the Corporations Law of a

State or internal Territory.

 

  58.(1) Subject to subsection (2), the governing rules of a superannuation

 

entity other than an excluded fund must not permit the trustee to be subject,

in the exercise of any of the trustee's powers under those rules, to direction

by any other person.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 58

 

Trustee not to be subject to direction

 

Back to Top

  (2) Subsection (1) does not apply to:

  (a) a direction given by a court; or

  (b) a direction given by the Commissioner; or

  (c) a direction given by a beneficiary or a group of beneficiaries that

relates to benefits payable to that beneficiary or those beneficiaries, as the

case may be; or

  (d) a direction given by a beneficiary or group of beneficiaries, where the

direction is covered by subsection 52(4); or

  (e) if the entity is an employer-sponsored fund-a direction given by an

employer-sponsor, or an associate of an employer-sponsor, in circumstances

prescribed by the regulations; or

  (f) a direction given by the Superannuation Complaints Tribunal.

  (3) A provision included in the governing rules of a superannuation entity

in contravention of this section is void.

 

  59.(1) The governing rules of a superannuation entity other than an excluded

fund must not permit a discretion under those rules that is exercisable by a

person other than the trustee to be exercised unless:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 59

 

Exercise of discretion by person other than trustee

 

  (a) those rules require the consent of the trustee to the exercise of that

discretion; or

  (b) if the entity is an employer-sponsored fund:

    (i) the exercise of the discretion relates to the

contributions that an employer-sponsor will, after the discretion is

exercised, be required or permitted to pay to the fund; or

    (ii) the exercise of the discretion relates solely to a

decision to terminate the fund; or

    (iii) the circumstances in which the discretion was exercised

are covered by regulations made for the purposes of this subparagraph.

  (2) A provision included in the governing rules of a superannuation entity

in contravention of subsection (1) is void.

 

  60.(1) The governing rules of a superannuation entity other than an excluded

fund must not permit those rules to be amended unless:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 60

 

Amendment of governing rules

 

  (a) the trustee has consented to the amendment; or

  (b) if the entity is an employer-sponsored fund:

    (i) the amendment relates to the contributions that an

employer-sponsor will, after the amendment, be required or permitted to pay to

the fund; or

    (ii) the amendment relates solely to the termination of the

fund; or

    (iii) the circumstances in which the amendment was made are

covered by regulations made for the purposes of this subparagraph; or

  (c) the amendment is made solely for the purpose of conferring on the

trustee the power to consent to amendments of those rules.

  (2) The governing rules of a regulated superannuation fund must not permit

those rules to be amended in such a way that:

  (a) an individual would be eligible to be appointed as trustee unless the

rules provide, and will continue to provide after the amendment is made, that

the fund has, as its sole or primary purpose, the provision of old-age

pensions; or

  (b) the sole or primary purpose of the fund would be a purpose other than

the provision of old-age pensions unless the rules provide, and will continue

to provide after the amendment is made, that the trustee must be a

constitutional corporation.

  (3) If the governing rules of the superannuation entity are inconsistent

with subsection (1) or (2), the subsection concerned prevails, and the

governing rules are, to the extent of the inconsistency, invalid.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 7

 

 

  61. The object of this Part is to set out special rules which apply only to

regulated superannuation funds.

          PART 7-PROVISIONS APPLYING ONLY TO REGULATED

                     SUPERANNUATION FUNDS

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 61

 

Object of Part

 

 

  62.(1) The trustee of a regulated superannuation fund must ensure that the

fund is maintained solely:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 62

 

Sole purpose test

 

  (a) for one or more of the following purposes (the "core purposes"):

    (i) the provision of benefits for each member of the fund on

or after the member's retirement from any business, trade, profession,

vocation, calling, occupation or employment in which the member was engaged

(whether the member's retirement occurred before, or occurred after, the

member joined the fund);

    (ii) the provision of benefits for each member of the fund on

 

or after the member's attainment of an age not less than the age specified in

the regulations;

Back to Top

    (iii) the provision of benefits for each member of the fund

on or after whichever is the earlier of:

      (A) the member's retirement from any business, trade,

profession, vocation, calling, occupation or employment in which the member

was engaged; or

      (B) the member's attainment of an age not less than the age

prescribed for the purposes of subparagraph (ii);

    (iv) the provision of benefits in respect of each member of

the fund on or after the member's death, if:

      (A) the death occurred before the member's retirement from

any business, trade, profession, vocation, calling, occupation or employment

in which the member was engaged; and

      (B) the benefits are provided to the member's legal

personal representative, to any or all of the member's dependants, or to

both;

    (v) the provision of benefits in respect of each member of

the fund on or after the member's death, if:

      (A) the death occurred before the member attained the age

prescribed for the purposes of subparagraph (ii); and

      (B) the benefits are provided to the member's legal

personal representative, to any or all of the member's dependants, or to both;

or

  (b) for one or more of the core purposes and for one or more of the

following purposes (the "ancillary purposes"):

    (i) the provision of benefits for each member of the fund on

or after the termination of the member's employment with an employer who had,

or any of whose associates had, at any time, contributed to the fund in

relation to the member;

    (ii) the provision of benefits for each member of the fund on

or after the member's cessation of work, if the work was for gain or reward in

any business, trade, profession, vocation, calling, occupation or employment

in which the member was engaged and the cessation is on account of ill-health

(whether physical or mental);

    (iii) the provision of benefits in respect of each member of

the fund on or after the member's death, if:

      (A) the death occurred after the member's retirement from

any business, trade, profession, vocation, calling, occupation or employment

in which the member was engaged (whether the member's retirement occurred

before, or occurred after, the member joined the fund); and

      (B) the benefits are provided to the member's legal

personal representative, to any or all of the member's dependants, or to

both;

    (iv) the provision of benefits in respect of each member of

the fund on or after the member's death, if:

      (A) the death occurred after the member attained the age

prescribed for the purposes of subparagraph (a)(ii); and

      (B) the benefits are provided to the member's legal

personal representative, to any or all of the member's dependants, or to

both;

    (v) the provision of such other benefits as the Commissioner

approves in writing.

  (2) Subsection (1) is a civil penalty provision as defined by section 193,

and Part 21 therefore provides for civil and criminal consequences of

contravening, or of being involved in a contravention of, that subsection.

  (3) An approval given by the Commissioner for the purposes of subsection (1)

may be expressed to relate to:

  (a) a specified fund; or

  (b) a specified class of funds.

 

  63.(1) The Commissioner may give the trustee of a regulated superannuation

fund a written notice directing the trustee not to accept any contributions

made to the fund by an employer-sponsor.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 63

 

Commissioner may direct trustees of certain regulated

superannuation funds not to accept employer contributions

Directions

 

Pre-1994-95 directions

  (2) The Commissioner may only give a direction under this section to the

trustee of a fund before the fund's 1994-95 year of income (whether in

accordance with section 4 of the Acts Interpretation Act 1901 or otherwise) if

the direction takes effect at the beginning of that year of income and, at a

time during the period:

  (a) beginning on the day on which this Act received the Royal Assent; and

  (b) ending immediately before the beginning of that year of income;

when:

  (c) the fund was in existence; and

  (d) there were in force regulations for the purposes of subsection 7(1) of

the Occupational Superannuation Standards Act 1987 prescribing standards

applicable to the fund;

 

the fund did not comply with any or all of those standards.

Back to Top

Post-1993-94 directions

  (3) The Commissioner must not give a direction under this section to the

trustee of a fund after the beginning of the fund's 1994-95 year of income

unless:

  (a) the trustee of the fund has contravened this Act or the regulations on

one or more occasions after the beginning of that year of income; and

  (b) the Commissioner is satisfied that the seriousness or frequency, or

both, of the contraventions warrants the giving of the direction.

Reasons

  (4) A direction under this section must be accompanied by, or included in

the same document as, a statement giving the reasons for the direction.

Revocation

  (5) The Commissioner may revoke a direction under this section if the

trustee of the fund concerned satisfies the Commissioner that there is, and is

likely to continue to be, substantial compliance by the trustee with the

provisions of this Act and the regulations applicable to the fund.

Contravention of equal representation rules

  (6) For the purposes of subsections (3) and (5), if a fund does not comply

with Part 9 (which deals with equal representation), the trustee of the fund

is taken to have contravened this Act.

Offence of contravening direction

  (7) A trustee of a fund must not, without reasonable excuse, contravene a

direction under this section.

Penalty: 100 penalty units.

Refund of contributions

  (8) A contravention of subsection (7) does not result in the invalidity of a

transaction. However, if a contribution is accepted in contravention of that

subsection, the trustee concerned must refund the contribution within 28 days

or such further period as the Commissioner allows.

Notification to employer-sponsors

  (9) If the trustee of a fund is given a direction under this section, the

trustee must take all reasonable steps to notify the direction to each

employer-sponsor of the fund.

Offence of contravening subsection (8) or (9)

  (10) A person who, without reasonable excuse, contravenes subsection (8) or

(9) is guilty of an offence punishable on conviction by a fine not exceeding

50 penalty units.

Refunded contributions to be ignored for the purposes of income tax and

superannuation guarantee charge

  (11) For the purposes of the Income Tax Assessment Act and the

Superannuation Guarantee (Administration) Act 1992, if a contribution is

refunded under this section, the person who made the contribution is taken

never to have made the contribution.

Superannuation guarantee charge-shortfall component to be treated as employer

contribution

  (12) This section has effect as if the payment of a shortfall component to a

fund under section 65 of the Superannuation Guarantee (Administration) Act

1992 were a contribution made to the fund by an employer-sponsor.

OSSA

  (13) A reference in this section to subsection 7(1) of the Occupational

Superannuation Standards Act 1987 includes a reference to that subsection as

it continues to apply, despite its repeal, because of the Occupational

Superannuation Standards Amendment Act 1993.

 

  64.(1) This section applies if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 64

 

Superannuation contributions-deductions from salary or wages to

be remitted promptly

Application

 

  (a) an employer of an employee is authorised (whether by the employee, by

force of law or otherwise) to:

    (i) deduct an amount from salary or wages payable by the

employer to the employee; and

    (ii) pay to the trustee of a regulated superannuation fund

the amount of the deduction for the purposes of making provision for

superannuation benefits for, or for dependants of, the employee; and

  (b) the employer makes such a deduction.

Prompt remission

  (2) The employer must pay to the trustee of the superannuation fund the

amount of the deduction before the end of the 28-day period beginning

immediately after the end of the month in which the deduction was made.

Offence

  (3) A person who intentionally or recklessly contravenes subsection (2) is

guilty of an offence punishable on conviction by a fine not exceeding 100

penalty units.

Definition

  (4) In this section:

  "salary or wages" has the same meaning as in the Superannuation Guarantee

(Administration) Act 1992.

Part-time domestic workers counted

 

  (5) For the purposes of this section, the Superannuation Guarantee

(Administration) Act 1992 has effect as if subsection 11(2) of that Act had

not been enacted.

Back to Top

 

  65.(1) The trustee or an investment manager of a regulated superannuation

fund must not:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 65

 

Lending to members of regulated superannuation fund prohibited

Prohibition

 

  (a) lend money of the fund to:

    (i) a member of the fund; or

    (ii) a relative of a member of the fund; or

  (b) give any other financial assistance using the resources of the fund to:

    (i) a member of the fund; or

    (ii) a relative of a member of the fund.

Exception-private sector funds

  (2) Subsection (1) does not prohibit the lending of money of a private

sector fund established before 16 December 1985 to a member if the trustee of

the fund, on or before that date:

  (a) had express power to lend money to members; or

  (b) lent money to members and that lending was not expressly prohibited by

the governing rules of the fund.

Exception-public sector funds

  (3) Subsection (1) does not prohibit the lending of money of a public sector

fund established before 25 May 1988 to a member if the trustee of the fund, on

or before that date:

  (a) had express power to lend money to members; or

  (b) lent money to members and that lending was not expressly prohibited by

the governing rules of the fund.

Variation of governing rules

  (4) If:

  (a) subsection (2) or (3) applies to a regulated superannuation fund; and

  (b) at the beginning of the fund's 1994-95 year of income, a provision

included in the governing rules of the fund authorised the lending of the

fund's money to members;

a variation of that provision is void unless the variation:

  (c) limits the power to lend the fund's money to members; or

  (d) removes the power to lend the fund's money to members.

Civil penalty provision

  (5) Subsection (1) is a civil penalty provision as defined by section 193,

and Part 21 therefore provides for civil and criminal consequences of

contravening, or of being involved in a contravention of, that subsection.

Definition

  (6) In this section:

  "relative" has the same meaning as in the Income Tax Assessment Act.

 

  66.(1) Subject to subsection (2), the trustee or an investment manager of a

regulated superannuation fund must not intentionally acquire an asset from:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 66

 

Acquisitions of certain assets from members of regulated

superannuation funds prohibited

Prohibition

 

  (a) a member of the fund; or

  (b) a relative of a member of the fund.

Exception-acquisitions of business real property and listed securities

  (2) Subsection (1) does not prohibit a trustee or investment manager

acquiring an asset from a member of the fund or a relative of such a member

if:

  (a) the asset is business real property of the member or relative, or a

listed security; and

  (b) the asset is acquired at market value; and

  (c) if the asset is business real property-after the acquisition of the

business real property, that property, together with any other business real

property previously acquired from a member of the fund or a relative of such a

member since this Act received the Royal Assent, would represent no more than

the acceptable percentage of the total value of the assets of the fund.

Prohibition of avoidance schemes

  (3) A person must not enter into, commence to carry out, or carry out a

scheme if the person entered into, commenced to carry out, or carried out the

scheme or any part of the scheme with the intention that:

  (a) the scheme would result, or be likely to result, in the acquisition of

an asset by the trustee or an investment manager of a regulated superannuation

fund, where the asset is acquired from a person who has a connection (either

direct or indirect through one or more interposed companies, partnerships or

trusts) with:

    (i) a member of the fund; or

    (ii) a relative of a member of the fund; and

  (b) that aquisition would avoid the application of subsection (1) to the

fund.

Offence

  (4) A person who contravenes subsection (1) or (3) is guilty of an offence

punishable on conviction by imprisonment for a term not exceeding 1 year.

 

Definitions

Back to Top

  (5) In this section:

  "acceptable percentage" means:

  (a) for an excluded superannuation fund-40%; and

  (b) otherwise-0%;

  "acquire an asset" does not include accept money;

  "business" includes any profession, trade, employment, vocation or calling

carried on for the purposes of profit, including:

  (a) the carrying on of primary production; and

  (b) the provision of professional services;

but does not include occupation as an employee;

  "business real property" of a person means any freehold or leasehold

interest in real property which is used wholly and exclusively in the person's

business;

  "listed security" means:

  (a) a share; or

  (b) a unit; or

  (c) a bond or debenture; or

  (d) a right or option; or

  (e) any other security;

listed for quotation in the official list of a stock exchange in Australia;

  "relative" has the same meaning as in the Income Tax Assessment Act;

  "scheme" means:

  (a) any agreement, arrangement, understanding, promise or undertaking:

    (i) whether express or implied; or

    (ii) whether or not enforceable, or intended to be

enforceable, by legal proceedings; and

  (b) any scheme, plan, proposal, action, course of action or course of

conduct, whether unilateral or otherwise.

 

  67.(1) Subject to this section, the trustee of a regulated superannuation

fund must not:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 67

 

Borrowing

Prohibition

 

  (a) borrow money; or

  (b) maintain an existing borrowing of money.

Exception-temporary borrowing to pay beneficiary

  (2) Subsection (1) does not prohibit the trustee of a regulated

superannuation fund from borrowing money if:

  (a) the purpose of the borrowing is to enable the trustee to make a payment

to a beneficiary which the trustee is required to make by law or by the

governing rules and which, apart from the borrowing, the trustee would not be

able to make; and

  (b) the period of the borrowing does not exceed 90 days; and

  (c) if the borrowing were to take place, the total amount borrowed by the

trustee would not exceed 10% of the value of the assets of the fund.

Exception-temporary borrowing to cover settlement of securities transactions

  (3) Subsection (1) does not prohibit the trustee of a regulated

superannuation fund from borrowing money if:

  (a) the purpose of the borrowing is to enable the trustee to cover

settlement of a transaction for the acquisition of any of the following:

    (i) bonds, debentures, stock, bills of exchange or other

securities;

    (ii) shares in a company;

    (iii) units in a unit trust;

    (iv) futures contracts;

    (v) forward contracts;

    (vi) interest rates swap contracts;

    (vii) currency swap contracts;

    (viii) forward exchange rate contracts;

    (ix) forward interest rate contracts;

    (x) a right or option in respect of such a security, share,

unit, contract or policy;

    (xi) any similar financial instrument;

    (xii) foreign currency; and

  (b) both:

    (i) at the time the relevant investment decision was made, it

was likely that the borrowing would not be needed; and

    (ii) the borrowing is not taken, under a written

determination made by the Commissioner, to be exempt from this paragraph; and

  (c) the period of the borrowing does not exceed 7 days; and

  (d) if the borrowing were to take place, the total amount borrowed by the

trustee would not exceed 10% of the value of the assets of the fund.

  (4) A determination made by the Commissioner under subsection (3) is a

disallowable instrument for the purposes of section 46A of the Acts

Interpretation Act 1901.

Exception-private sector funds

  (5) Subsection (1) does not prohibit the trustee of a private sector fund

from maintaining an existing borrowing of money if:

  (a) the trustee had, at a time before 12 June 1986, borrowed the money in

 

circumstances that did not comply with the standard set out in paragraph

16(1)(b) of the Occupational Superannuation Standards Regulations; and

Back to Top

  (b) the maintenance occurs before whichever is the earliest of the

following:

    (i) the day on which the trustee made such arrangements as

were necessary to comply with that standard;

    (ii) the day on which the trustee makes such arrangements as

are necessary to comply with subsection (1);

    (iii) 1 July 1995.

Exception-public sector funds

  (6) Subsection (1) does not prohibit the trustee of a public sector fund

from maintaining an existing borrowing of money if:

  (a) the trustee had, at a time before 2 July 1990, borrowed the money in

circumstances that did not comply with the standard set out in paragraph

16(1)(b) of the Occupational Superannuation Standards Regulations; and

  (b) the maintenance occurs before whichever is the earliest of the

following:

    (i) the day on which the trustee made such arrangements as

were necessary to comply with that standard;

    (ii) the day on which the trustee makes such arrangements as

are necessary to comply with subsection (1);

    (iii) 1 July 2000.

Civil penalty provision

  (7) Subsection (1) is a civil penalty provision as defined by section 193,

and Part 21 therefore provides for civil and criminal consequences of

contravening, or of being involved in a contravention of, that subsection.

 

  68.(1) A person must not intentionally or recklessly commit an act of

victimisation against:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 68

 

Victimisation of trustees etc.

Prohibition

 

  (a) the trustee of an employer-sponsored fund; or

  (b) a responsible officer of a corporate trustee of an employer-sponsored

fund.

Penalty: Imprisonment for 2 years.

Act of victimisation against trustee

  (2) For the purposes of this section, a person is taken to commit an act of

victimisation against the trustee of an employer-sponsored fund if, and only

if, the person subjects, or threatens to subject, the trustee to a detriment

on the grounds that:

  (a) the trustee has fulfilled, is fulfilling, or is proposing to fulfil, an

obligation imposed on the trustee; or

  (b) the trustee has exercised, is exercising, or is proposing to exercise,

the trustee's powers in a particular way.

Act of victimisation against officer of corporate trustee

  (3) For the purposes of this section, a person is taken to commit an act of

victimisation against a responsible officer of a corporate trustee of an

employer-sponsored fund if, and only if, the person subjects, or threatens to

subject, the responsible officer to a detriment on the grounds that:

  (a) the trustee or officer has fulfilled, is fulfilling, or is proposing to

fulfil, an obligation imposed on the trustee or officer; or

  (b) the trustee or officer has exercised, is exercising, or is proposing to

exercise, any of the trustee's powers or the officer's powers, as the case may

be, in a particular way.

Employers

  (4) For the purposes of this section, an employer is taken to subject an

employee to a detriment if the employer:

  (a) dismisses the employee; or

  (b) injures the employee in his or her employment; or

  (c) alters the position of the employee to the employee's prejudice.

However, for the purposes of this section, an employer is taken not to subject

an employee to a detriment if the employer:

  (a) permanently ceases to be an employer-sponsor of a superannuation fund of

which the employee is a member; or

  (b) temporarily ceases to contribute to a superannuation fund in respect of

a class of members in which the employee is included; or

  (c) reduces the level of contributions to a superannuation fund in respect

of a class of members in which the employee is included.

Reasons

  (5) In civil proceedings arising out of this section:

  (a) it is not necessary for the plaintiff to prove the defendant's reason

for the alleged action; and

  (b) it is a defence if the defendant proves that the action was not

motivated (whether in whole or in part) by the alleged reason.

Obligations

  (6) A reference in this section to an obligation imposed on a trustee or a

responsible officer is a reference to an obligation imposed on the trustee or

officer by this Act or the regulations, by the governing rules of the entity

concerned or otherwise.

Powers

 

  (7) A reference in this section to the powers of a trustee or a responsible

officer is a reference to the powers conferred on the trustee or the officer

by this Act or the regulations, by the governing rules of the entity concerned

or otherwise.

Back to Top

Civil liability

  (8) If:

  (a) a person (the "defendant") commits an act of victimisation against:

    (i) the trustee of an employer-sponsored fund; or

    (ii) a responsible officer of a corporate trustee of an

employer-sponsored fund; and

  (b) the trustee or officer suffers loss or damage because of the act of

victimisation;

the trustee or officer may recover the amount of the loss or damage by action

against the defendant.

Special meaning of "employee" and "employer"

  (9) The meaning of the expressions "employee" and "employer", when used in

this section, is to be determined as if subsections 12(3) and (8) of the

Superannuation Guarantee (Administration) Act 1992 had not been enacted.

(Those subsections deem certain contractors to be employees.)

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 8

 

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 1

 

 

  69. The object of this Part is to set out rules about the level of the

in-house assets of regulated superannuation funds.

        PART 8-IN-HOUSE ASSET RULES APPLYING TO REGULATED

                     SUPERANNUATION FUNDS

 

             Division 1-Object and interpretation

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 69

 

Object of Part

 

 

  70. For the purposes of this Part:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 70

 

Associate of employer-sponsor

 

  (a) a person is an associate of a standard employer-sponsor of a

superannuation fund other than a public sector fund if, and only if, the

person is an associate of the employer-sponsor within the meaning of

subsection 26AAB(14) of the Income Tax Assessment Act; and

  (b) a person is an associate of a standard employer-sponsor of a public

sector fund if, and only if:

    (i) the person is a body corporate; and

    (ii) either:

      (A) the person has a controlling interest in, or directs

the operations of, the employer-sponsor; or

      (B) the employer-sponsor has a controlling interest in, or

directs the operations of, the person.

 

  71.(1) For the purposes of this Part, an in-house asset of a superannuation

fund is an asset of the fund that is a loan to, or an investment in, a

standard employer-sponsor, or an associate of a standard employer-sponsor, of

the fund, but does not include:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 71

 

Meaning of "in-house asset"

Basic meaning

 

  (a) a life policy issued by a life insurance company; or

  (b) a deposit with an approved bank; or

  (c) an investment in a pooled superannuation trust, where the trustee of the

fund and the trustee of the pooled superannuation trust acted at arm's length

in relation to the making of that investment; or

  (d) an asset of a public sector fund, where the asset consists of an

investment in securities issued under the authority of:

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

Territory; or

    (ii) a public authority constituted by or under a law of the

Commonwealth, a State or a Territory, where the public authority is neither a

standard employer-sponsor, nor an associate of a standard employer-sponsor, of

the fund; or

  (e) an asset which the Commissioner, by written notice given to the trustee

of the fund, determines is not an in-house asset of the fund; or

  (f) an asset which the Commissioner, by written determination, determines is

not an in-house asset of:

    (i) any fund; or

    (ii) a class of funds in which the fund is included.

Agreements

  (2) If:

  (a) apart from this subsection, an asset of a fund consists of a loan, or an

investment, other than an in-house asset; and

  (b) the loan or investment was made as the result of entering into or

carrying out an agreement; and

  (c) any of the persons who entered into or carried out the agreement did so

for the purpose, or purposes that included the purpose, of achieving the

result that a loan or investment would be made to or in, or to or in an

associate of, a standard employer-sponsor of the fund;

then:

 

  (d) the asset is taken, for the purposes of this Part, to be a loan to, or

an investment in, the standard employer-sponsor, or the associate of the

employer-sponsor, as the case requires; and

Back to Top

  (e) paragraphs (1)(a) to (f) (inclusive) do not apply to the asset.

2 or more purposes

  (3) Subsection (2) does not stop the same asset from being treated as if it

were a loan to, or an investment in, 2 or more persons if 2 or more purposes

apply under paragraph (2)(c).

Commissioner's determination

  (4) If:

  (a) apart from this subsection, an asset of a fund consists of a loan, or an

investment, other than an in-house asset; and

  (b) the Commissioner, by written notice given to the trustee of the fund,

determines that the asset is to be treated, with effect from the day on which

the notice is given, as if the asset were a loan to, or an investment in, a

specified standard employer-sponsor of the fund;

then:

  (c) the asset is taken, for the purposes of this Part, to be a loan to, or

an investment in, the employer-sponsor; and

  (d) paragraphs (1)(a) to (f) (inclusive) do not apply to the asset.

Paragraph (1)(e) determinations may be retrospective

  (5) A determination under paragraph (1)(e) may be expressed to have taken

effect at a time earlier than the time when the determination was made.

Paragraph (1)(f) determinations to be disallowable instruments

  (6) A determination under paragraph (1)(f) is a disallowable instrument for

the purposes of section 46A of the Acts Interpretation Act 1901.

 

  72.(1) For the purposes of this section, a standard employer-sponsor (the

"first employer-sponsor") of a superannuation fund is an unrelated

employer-sponsor of the fund if, and only if, there is no other standard

employer-sponsor of the fund who is an associate of the first

employer-sponsor.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 72

 

How this Part applies if there are 2 or more unrelated employer-sponsors

Meaning of "unrelated employer-sponsor"

 

Corresponding classes of in-house assets

  (2) For the purposes of this section, the class of the in-house assets of a

fund that corresponds to a particular unrelated employer-sponsor is the class

of in-house assets that consists of loans to, or investments in, the

employer-sponsor or an associate of the employer-sponsor.

Part applies separately in relation to each unrelated employer-sponsor

  (3) If there are 2 or more unrelated employer-sponsors of a superannuation

fund:

  (a) this Part does not apply in relation to the fund in relation to the

in-house assets of the fund as a whole but, instead, applies in relation to

the fund separately in relation to each of the 2 or more corresponding classes

of in-house assets of the fund; and

  (b) for the purposes of this Part as so applying in relation to each of the

2 or more corresponding classes of in-house assets of the fund, that

corresponding class of in-house assets is to be treated as the whole of the

in-house assets of the fund.

 

  73.(1) For the purposes of this Part, if:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 73

 

Cost of in-house asset

 

  (a) an asset of a superannuation fund was acquired:

    (i) without consideration; or

    (ii) for consideration other than the arm's length value of

the asset when it was acquired; or

  (b) the whole or a part of the consideration for which an asset of a

superannuation fund was acquired was not money;

the cost of the asset is taken to be the arm's length value of the asset when

it was acquired.

  (2) In this section:

  "arm's length value", in relation to an asset, means the amount that the

acquirer of the asset could reasonably be expected to have been required to

pay to acquire the asset under a transaction where the parties to the

transaction are dealing with each other at arm's length in relation to the

transaction.

 

  74. For the purposes of this Part, the historical cost ratio of a fund's

in-house assets is the percentage worked out using the formula:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 74

 

Historical cost ratio of fund's in-house assets

 

    Number of whole dollars in cost of

       in-house assets of the fund         X  100

    Number of whole dollars in cost of

       all the assets of the fund

 

  75. For the purposes of this Part, the market value ratio of a fund's

in-house assets is the percentage worked out using the formula:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 75

 

Market value ratio of fund's in-house assets

 

    Number of whole dollars in value of

 

       in-house assets of the fund         X  100

Back to Top

    Number of whole dollars in value of

       all the assets of the fund

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 2

 

 

  76.(1) This section applies to a regulated superannuation fund, if the fund

is a private sector fund established on or after 12 March 1985.

   Division 2-Historical cost ratio of fund's in-house assets

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 76

 

Private sector funds established on or after 12 March 1985-historical cost

ratio for the 1994-95 year of income

 

  (2) At all times during the fund's 1994-95 year of income when the fund was

in existence, the historical cost ratio of the fund's in-house assets must not

exceed 10%.

 

  77.(1) This section applies to a regulated superannuation fund, if the fund

is a private sector fund established before 12 March 1985.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 77

 

Private sector funds established before 12 March 1985-historical cost ratio

for the 1994-95 year of income

 

  (2) At all times during the fund's 1994-95 year of income when the fund was

in existence, the historical cost ratio of the fund's in-house assets must not

exceed whichever is the greater of the following percentages:

  (a) whichever is the lesser of the following percentages:

    (i) the percentage equal to the historical cost ratio of the

fund's in-house assets as at the end of 11 March 1985;

    (ii) 70%;

  (b) 10%.

  (3) Section 72 is to be ignored in working out the percentage mentioned in

subparagraph (2)(a)(i).

 

  78.(1) This section applies to a regulated superannuation fund, if the fund

is a public sector fund established on or after 1 July 1990.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 78

 

Public sector funds established on or after 1 July 1990-historical cost ratio

for the 1994-95 year of income

 

  (2) At all times during the fund's 1994-95 year of income when the fund was

in existence, the historical cost ratio of the fund's in-house assets must not

exceed 10%.

 

  79.(1) This section applies to a regulated superannuation fund, if the fund

is a public sector fund established before 1 July 1990.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 79

 

Public sector funds established before 1 July 1990-historical cost ratio for

the 1994-95 year of income

 

  (2) At all times during the fund's 1994-95 year of income when the fund was

in existence, the historical cost ratio of the fund's in-house assets must not

exceed whichever is the greater of the following percentages:

  (a) the percentage equal to the historical cost ratio of the fund's in-house

assets as at the end of 1 July 1990;

  (b) 10%.

  (3) Section 72 is to be ignored in working out the percentage mentioned in

paragraph (2)(a).

 

  80.(1) This section applies to a regulated superannuation fund.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 80

 

All funds-historical cost ratio for the 1995-96 year of income, the 1996-97

year of income and the 1997-98 year of income

 

  (2) At all times during the period:

  (a) beginning at the beginning of the fund's 1995-96 year of income; and

  (b) ending at the end of the fund's 1997-98 year of income;

when the fund was in existence, the historical cost ratio of the fund's

in-house assets must not exceed 10%.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 3

 

 

  81.(1) This section applies to a regulated superannuation fund.

     Division 3-Market value ratio of fund's in-house assets

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 81

 

All funds-market value ratio for the 1998-99 year of income

and the 1999-2000 year of income

 

  (2) The market value ratio of the fund's in-house assets as at the end of:

  (a) the fund's 1998-99 year of income; or

  (b) the fund's 1999-2000 year of income;

must not exceed 10%.

 

  82.(1) This section applies to a regulated superannuation fund.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 82

 

All funds-market value ratio for the 2000-2001 year of income

and later years of income

 

  (2) If the market value ratio of the fund's in-house assets as at the end

of:

  (a) the fund's 2000-2001 year of income; or

  (b) a later year of income;

exceeds 5%, the trustee of the fund must prepare a written plan.

  (3) The plan must specify the amount (the "excess amount") worked out using

the formula:

  Market value ratio of fund's                   Value of fund's

 

  in-house assets as at the end  -  5%     X     assets as at the end

Back to Top

  of that year of income                         of that year of income

  (4) The plan must set out the steps which the trustee proposes to take in

order to ensure that:

  (a) one or more of the fund's in-house assets held at the end of that year

of income are disposed of during the next following year of income; and

  (b) the value of the assets so disposed of is equal to or more than the

excess amount.

  (5) The plan must be prepared before the end of the next following year of

income.

  (6) The trustee must carry out the steps in the plan.

 

  83.(1) This section applies to a regulated superannuation fund.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 83

 

Certain new in-house asset investments prohibited

 

  (2) If the market value ratio of the fund's in-house assets exceeds 5%, the

trustee of the fund must not acquire an in-house asset.

  (3) If the market value ratio of the fund's in-house assets does not exceed

5%, the trustee of the fund must not acquire an in-house asset if the

acquisition would result in the market value ratio of the fund's in-house

assets exceeding 5%.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 4

 

 

  84.(1) The trustee of a regulated superannuation fund must take all

reasonable steps to ensure that the provisions of Divisions 2 and 3 are

complied with.

                   Division 4-Enforcement

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 84

 

In-house asset rules must be complied with

 

  (2) Subsection (1) is a civil penalty provision as defined by section 193,

and Part 21 therefore provides for civil and criminal consequences of

contravening, or of being involved in a contravention of, that subsection.

  (3) A contravention of subsection (1) does not affect the validity of a

transaction.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - DIVISION 5

 

 

  85.(1) A person must not enter into, commence to carry out, or carry out, a

scheme if the person entered into, commenced to carry out, or carried out the

scheme or any part of the scheme with the intention that:

                   Division 5-Anti-avoidance

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 85

 

Prohibition of avoidance schemes

Prohibition

 

  (a) the scheme would result, or be likely to result, in an artificial

reduction in the market value ratio of the fund's in-house assets; and

  (b) that artificial reduction would avoid the application of any provision

of this Part to the fund.

Civil penalty provision

  (2) Subsection (1) is a civil penalty provision as defined by section 193,

and Part 21 therefore provides for civil and criminal consequences of

contravening, or being involved in a contravention of, that subsection.

Validity of transaction not affected by contravention of subsection (1)

  (3) A contravention of subsection (1) does not affect the validity of a

transaction.

Scheme

  (4) In this section:

  "scheme" means:

  (a) any agreement, arrangement, understanding, promise or undertaking:

    (i) whether express or implied; or

    (ii) whether or not enforceable, or intended to be

enforceable, by legal proceedings; and

  (b) any scheme, plan, proposal, action, course of action or course of

conduct, whether unilateral or otherwise.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 9

 

 

  86. The object of this Part is to set out rules about the representation of

employers and members in relation to the management and control of standard

employer-sponsored funds.

          PART 9-EQUAL REPRESENTATION OF EMPLOYERS AND

                MEMBERS-EMPLOYER-SPONSORED FUNDS

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 86

 

Object of Part

 

 

  87. It is not an offence to contravene this Part and a failure to comply

with this Part does not result in the invalidity of a transaction. However, a

contravention of this Part may result in a fund not being a complying

superannuation fund for the purposes of Part IX of the Income Tax Assessment

Act (see Part 5 of this Act).

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 87

 

Consequences of non-compliance with this Part

 

 

  88. This Part does not apply to a fund if the fund has an acting trustee

appointed under Part 17.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 88

 

This Part does not apply if acting trustee appointed under Part 17

 



Basic rule

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 89

 

Basic equal representation rules

 

  89.(1) For the purposes of this Part, a fund complies with the basic equal

representation rules if:


Back to Top

  (a) both:

    (i) the fund has a group of 2 or more individual trustees;

    (ii) the group of trustees consists of equal numbers of

employer representatives and member representatives; or

  (b) both:

    (i) the fund has a single corporate trustee;

    (ii) the board of the corporate trustee consists of equal

numbers of employer representatives and member representatives.

Additional independent trustee or additional independent director

  (2) For the purposes of the application of the basic equal representation

rules to a fund, a group of trustees, or the board of a corporate trustee, is

taken to consist of equal numbers of employer representatives and member

representatives if:

  (a) the group or board includes an additional independent trustee or an

additional independent director, as the case may be; and

  (b) the additional independent trustee or additional independent director,

as the case may be, is appointed at the request of the employer

representatives, or the member representatives, who are the members of the

group or board; and

  (c) provision is made in the governing rules for the appointment of the

independent additional trustee or additional independent director, as the case

may be; and

  (d) the governing rules do not allow the additional independent trustee or

additional independent director, as the case may be, to exercise a casting

vote in any proceedings of the group or board concerned.

Vacancy

  (3) For the purposes of the application of the basic equal representation

rules to a fund, if:

  (a) a vacancy occurs in the membership of a group of trustees or of the

board of a corporate trustee; and

  (b) immediately before the vacancy occurred, the fund complied with the

basic equal representation rules; and

  (c) the vacancy is filled within 90 days after it occurred; and

  (d) immediately after the vacancy is filled, the fund complies with the

basic equal representation rules;

the fund is taken to have complied with the basic equal representation rules

at all times during the period of the vacancy.

 

  90.(1) This section applies to a standard employer-sponsored fund (other

than a public offer superannuation fund) with fewer than 200 members, where:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 90

 

Pre-1 July 1995 rules-funds with fewer than 200 members

Application

 

  (a) the fund is a private sector fund established on or after 16 December

1985; or

  (b) the fund is a public sector fund established on or after 25 May 1988;

or

  (c) if there are 2 or more standard employer-sponsors of the fund-any one of

those employer-sponsors is not an associate of any other of those

employer-sponsors.

Pre-1 July 1995

  (2) This section does not apply on or after 1 July 1995.

Rules

  (3) The fund must comply with:

  (a) the basic equal representation rules; or

  (b) the alternative agreed representation rule set out in subsection (4).

Alternative agreed representation rule

  (4) For the purposes of this section, a fund complies with the alternative

agreed representation rule if any of the trustees of the fund are appointed

following nomination by agreement between:

  (a) either:

    (i) the members of the fund; or

    (ii) a trade union, or other organisation, representing the

interests of those members; and

  (b) either:

    (i) the employer or employers of those members; or

    (ii) an organisation representing the interests of that

employer or those employers.

 

  91.(1) This section applies to a standard employer-sponsored fund with 200

or more members, where:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 91

 

Pre-1 July 1995 rules-funds with 200 or more members

Application

 

  (a) the fund is a private sector fund established on or after 16 December

1985; or

  (b) the fund is a public sector fund established on or after 25 May 1988;

or

 

  (c) if there are 2 or more standard employer-sponsors of the fund-any one of

those employer-sponsors is not an associate of any other of those

employer-sponsors.

Back to Top

Pre-1 July 1995

  (2) This section does not apply on or after 1 July 1995.

Public offer funds

  (3) If the fund is a public offer superannuation fund:

  (a) the trustee of the fund must be an independent trustee; and

  (b) if the regulations provide that the fund is subject to rules about the

existence, number and functions of policy committees ("prescribed policy

committees")-the fund must comply with those rules; and

  (c) each prescribed policy committee must consist of equal numbers of

employer representatives and member representatives.

Non-public offer funds

  (4) If the fund is not a public offer superannuation fund, the fund must

comply with the basic equal representation rules.

Transitional

  (5) If, at a particular time, the number of members of a fund increases from

a number less than 200 to 200 or more:

  (a) the trustee of the fund must make such arrangements (if any) as are

necessary to enable the fund to comply with this section; and

  (b) the fund does not have to comply with this section during the period:

    (i) beginning at that time; and

    (ii) ending at whichever is the earlier of the following

times:

      (A) the time at which such arrangements are made;

      (B) the end of 90 days.

 

  92.(1) This section applies to a standard employer-sponsored fund with more

than 4, but fewer than 50, members.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 92

 

Post-30 June 1995 rules-funds with more than 4, but fewer than 50, members

Application

 

Post-30 June 1995

  (2) This section applies on and after 1 July 1995.

Public offer funds

  (3) If the fund is a public offer superannuation fund:

  (a) the trustee of the fund must be an independent trustee; and

  (b) if the regulations provide that the fund is subject to rules about the

existence, number and functions of policy committees ("prescribed policy

committees")-the fund must comply with those rules; and

  (c) each prescribed policy committee must consist of equal numbers of

employer representatives and member representatives.

Non-public offer funds

  (4) If the fund is not a public offer superannuation fund, the fund must

comply with:

  (a) the basic equal representation rules; or

  (b) the alternative agreed representation rule set out in subsection (5).

Alternative agreed representation rule

  (5) For the purposes of this section, a fund complies with the alternative

agreed representation rule if:

  (a) there is a single corporate trustee of the fund; and

  (b) the trustee is appointed following nomination by agreement between:

    (i) a majority of the members of the fund; and

    (ii) the employer or employers of those members; and

  (c) there is in force an approval of the trustee under subsection (6); and

  (d) the trustee is not an associate of a standard employer-sponsor of the

fund.

Approval of trustee

  (6) A body corporate may apply for an approval under this subsection.

Application for approval

  (7) The application must be in writing and must be given to the

Commissioner.

Information to accompany application

  (8) The application must be accompanied by such information as the

Commissioner requires.

Further information

  (9) The Commissioner may refuse to consider the application unless the

applicant gives the Commissioner such further information about the

application as the Commissioner requires.

Decision

  (10) After considering the application, the Commissioner must:

  (a) grant the approval; or

  (b) refuse to grant the approval.

Reasons for refusing approval

  (11) If the Commissioner makes a decision refusing an application for the

grant of an approval, the Commissioner must cause to be given to the applicant

a written notice setting out the decision and giving the reasons for that

decision.

Revocation of approval

  (12) The Commissioner may, by written notice given to the holder of an

 

approval, revoke the approval.

Back to Top

 

  93.(1) This section applies to a standard employer-sponsored fund with more

than 49 members.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 93

 

Post-30 June 1995 rules-funds with more than 49 members

Application

 

Post-30 June 1995

  (2) This section applies on and after 1 July 1995.

Public offer funds

  (3) If the fund is a public offer superannuation fund:

  (a) the trustee of the fund must be an independent trustee; and

  (b) if the regulations provide that the fund is subject to rules about the

existence, number and functions of policy committees ("prescribed policy

committees")-the fund must comply with those rules; and

  (c) each prescribed policy committee must consist of equal numbers of

employer representatives and member representatives.

Non-public offer funds

  (4) If the fund is not a public offer superannuation fund, the fund must

comply with the basic equal representation rules.

Transitional

  (5) If, at a particular time, the number of members of a fund increases from

a number greater than 4, but less than 50, to 50 or more:

  (a) the trustee of the fund must make such arrangements (if any) as are

necessary to enable the fund to comply with this section; and

  (b) the fund does not have to comply with this section during the period:

    (i) beginning at that time; and

    (ii) ending at whichever is the earlier of the following

times:

      (A) the time at which such arrangements are made;

      (B) the end of 90 days; and

  (c) despite subsection 92(1), the fund must comply with subsection 92(3) or

(4) during that 90-day period.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 10

 

 

  94. The object of this Part is to set out rules about borrowing by the

trustees of approved deposit funds.

   PART 10-PROVISIONS APPLYING ONLY TO APPROVED DEPOSIT FUNDS

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 94

 

Object of Part

 

 

  95.(1) Except with the approval of the Commissioner under subsection (2) or

except as provided by subsection (3), the trustee of an approved deposit fund

must not borrow money.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 95

 

Borrowing

 

  (2) The Commissioner may approve a borrowing by the trustee of an approved

deposit fund if the trustee satisfies the Commissioner that special

circumstances exist that justify the borrowing.

  (3) Subsection (1) does not prohibit the trustee of an approved deposit fund

from borrowing money if:

  (a) the purpose of the borrowing is to enable the trustee to cover

settlement of a transaction for the acquisition of any of the following:

    (i) bonds, debentures, stock, bills of exchange or other

securities;

    (ii) shares in a company;

    (iii) units in a unit trust;

    (iv) futures contracts;

    (v) forward contracts;

    (vi) interest rates swap contracts;

    (vii) currency swap contracts;

    (viii) forward exchange rate contracts;

    (ix) forward interest rate contracts;

    (x) a right or option in respect of such a security, share,

unit, contract or policy;

    (xi) any similar financial instrument;

    (xii) foreign currency; and

  (b) both:

    (i) at the time the relevant investment decision was made, it

was likely that the borrowing would not be needed; and

    (ii) the borrowing is not taken, under a written

determination made by the Commissioner, to be exempt from this paragraph; and

  (c) the period of the borrowing does not exceed 7 days; and

  (d) if the borrowing were to take place, the total amount borrowed by the

trustee would not exceed 10% of the value of the assets of the fund.

  (4) A determination made by the Commissioner under subsection (3) is a

disallowable instrument for the purposes of section 46A of the Acts

Interpretation Act 1901.

  (5) Subsection (1) is a civil penalty provision as defined by section 193,

and Part 21 therefore provides for civil and criminal consequences of

contravening, or of being involved in a contravention of, that subsection.



 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 11

 

                   SUPERANNUATION TRUSTS

 

 

  96. The object of this Part is to set out special rules applying only to

pooled superannuation trusts.

          PART 11-PROVISIONS APPLYING ONLY TO POOLED


Back to Top

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 96

 

Object of Part

 

 

  97.(1) Subject to subsection (2), the trustee of a pooled superannuation

trust must not borrow money.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 97

 

Borrowing

 

  (2) Subsection (1) does not prohibit the trustee of a pooled superannuation

trust from borrowing money if:

  (a) the purpose of the borrowing is to enable the trustee to make a payment

to a beneficiary in the trust which the trustee is required to make by law or

by the governing rules and which, apart from the borrowing, the trustee would

not be able to make; and

  (b) the period of the borrowing does not exceed 90 days; and

  (c) if the borrowing were to take place, the total amount borrowed by the

trustee would not exceed 10% of the value of the assets of the trust.

  (3) Subsection (1) does not prohibit the trustee of a pooled superannuation

trust from borrowing money if:

  (a) the purpose of the borrowing is to enable the trustee to cover

settlement of a transaction for the acquisition of any of the following:

    (i) bonds, debentures, stock, bills of exchange or other

securities;

    (ii) shares in a company;

    (iii) units in a unit trust;

    (iv) futures contracts;

    (v) forward contracts;

    (vi) interest rates swap contracts;

    (vii) currency swap contracts;

    (viii) forward exchange rate contracts;

    (ix) forward interest rate contracts;

    (x) a right or option in respect of such a security, share,

unit, contract or policy;

    (xi) any similar financial instrument;

    (xii) foreign currency; and

  (b) both:

    (i) at the time the relevant investment decision was made, it

was likely that the borrowing would not be needed; and

    (ii) the borrowing is not taken, under a written

determination made by the Commissioner, to be exempt from this paragraph; and

  (c) the period of the borrowing does not exceed 7 days; and

  (d) if the borrowing were to take place, the total amount borrowed by the

trustee would not exceed 10% of the value of the assets of the trust.

  (4) A determination made by the Commissioner under subsection (3) is a

disallowable instrument for the purposes of section 46A of the Acts

Interpretation Act 1901.

 

  98. The trustee or an investment manager of a pooled superannuation trust

must not:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 98

 

Lending to unit-holders prohibited

 

  (a) lend money of the trust to a beneficiary of the trust; or

  (b) give any other financial assistance using the resources of the trust to

a beneficiary of the trust.

 

  99. Subsection 97(1) and section 98 are civil penalty provisions as defined

by section 193, and Part 21 therefore provides for civil and criminal

consequences of contravening, or of being involved in a contravention of,

either of them.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 99

 

Civil penalty provisions

 

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 12

 

 

  100. The object of this Part is to impose special duties on the trustees and

investment managers of superannuation entities.

       PART 12-DUTIES OF TRUSTEES AND INVESTMENT MANAGERS

                  OF SUPERANNUATION ENTITIES

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 100

 

Object of Part

 

 

  101.(1) The trustee of a regulated superannuation fund other than an

excluded superannuation fund, or of an approved deposit fund other than an

excluded approved deposit fund, must take all reasonable steps to ensure that

there are at all times in force arrangements under which:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 101

 

Duty to establish arrangements for dealing with inquiries or complaints

 

  (a) beneficiaries have the right to make inquiries into, or complaints

about, the operation or management of the fund in relation to the beneficiary

making the inquiry or complaint; and

  (b) inquiries or complaints so made will be properly considered and dealt

with within 90 days after they were made.

  (2) A person who intentionally or recklessly contravenes subsection (1) is

guilty of an offence punishable on conviction by a fine not exceeding 100

 

penalty units.

Back to Top

 

  102.(1) If the trustee of a superannuation entity enters into an agreement

with an investment manager under which money of the entity will be placed

under the control of the investment manager, the trustee must:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 102

 

Duty to seek information from investment manager

 

  (a) ensure that the agreement contains adequate provision to enable the

trustee to require the investment manager from time to time:

    (i) to provide appropriate information as to the making of,

and return on, the investments; and

    (ii) to provide such information as is necessary to enable

the trustee to assess the capability of the investment manager to manage the

investments of the entity; and

  (b) whenever it is necessary or desirable to do so, require the investment

manager to provide the information.

  (2) If:

  (a) the trustee of a superannuation entity entered into an agreement before

the commencement of this section with an investment manager under which money

of the entity would be placed under the control of the investment manager;

and

  (b) the agreement does not contain a provision of a kind mentioned in

paragraph (1)(a);

the trustee must as soon as practicable:

  (c) seek to have the agreement amended so as to contain such a provision;

or

  (d) if the investment manager refuses to agree to such an

amendment-terminate the agreement.

  (3) The trustee of a superannuation entity:

  (a) may terminate an agreement under paragraph (2)(d) despite anything in

the agreement; and

  (b) is not under any liability to the investment manager because of the

termination.

  (4) A person who intentionally or recklessly contravenes subsection (1) or

(2) is guilty of an offence punishable on conviction by a fine not exceeding

100 penalty units.

 

  103.(1) If a superannuation entity has a group of 2 or more individual

trustees, the trustees must keep, and retain for at least 10 years, minutes of

all meetings of the trustees at which matters affecting the entity were

considered.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 103

 

Duty to keep minutes and records

 

  (2) If there is only one trustee of a superannuation entity:

  (a) if the trustee is a corporate trustee-the directors of the trustee must

keep, and retain for at least 10 years, minutes of all meetings of the

directors at which matters affecting the entity were considered; or

  (b) if the trustee is an individual-the trustee must keep, and retain for at

least 10 years, a record of all decisions made by the trustee in respect of

matters affecting the entity.

  (3) A person who intentionally or recklessly contravenes subsection (1) or

(2) is guilty of an offence punishable on conviction by a fine not exceeding

50 penalty units.

 

  104.(1) The trustee of a superannuation entity must keep, and retain for at

least 10 years, up-to-date records of all changes of trustees, and changes of

directors of any corporate trustee, of the entity and of all consents given

under section 118.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 104

 

Duty to keep records of changes of trustees

 

  (2) A person who intentionally or recklessly contravenes subsection (1) is

guilty of an offence punishable on conviction by a fine not exceeding 50

penalty units.

 

  105.(1) The trustee of a regulated superannuation fund or of an approved

deposit fund must:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 105

 

Duty to keep reports

 

  (a) keep, and retain so long as they are relevant and in any event for at

least 10 years, copies of reports that were given in the same form (apart from

differences relating to the names and addresses of the persons to whom the

notices were given):

    (i) in the case of a regulated superannuation fund-to all

members of the fund, or to all members included in a particular class of

members; or

    (ii) in the case of an approved deposit fund-to all

beneficiaries in the fund, or to all beneficiaries included in a particular

class of beneficiaries;

if the reports were given under this Act, under the Superannuation Entities

(Taxation) Act 1987 or under the governing rules; and

  (b) make those copies available for inspection by a member of the staff of

the Commissioner if requested to do so by a member of that staff.

  (2) A person who intentionally or recklessly contravenes subsection (1) is

guilty of an offence punishable on conviction by a fine not exceeding 50

 

penalty units.

Back to Top

 

  106.(1) If the trustee of a superannuation entity becomes aware of the

occurrence of an event having a significant adverse effect on the financial

position of the entity, the trustee must give written notice to the

Commissioner setting out particulars of the event. The trustee must do this no

later than the third business day after becoming aware of the event.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 106

 

Duty to notify Commissioner of significant adverse events

 

  (2) An event has a significant adverse effect on the financial position of

an entity if, as a result of the event, the trustee will not, or may not, be

able, at a time before the next annual report by the trustee to beneficiaries

entitled to the report, to make payments to beneficiaries as and when the

obligation to make those payments arises.

  (3) Subsection (1) is a civil penalty provision as defined by section 193,

and Part 21 therefore provides for civil and criminal consequences of

contravening, or of being involved in a contravention of, that subsection.

 

  107.(1) This section applies if the trustee of a standard employer-sponsored

fund (other than an excluded superannuation fund) is required by law:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 107

 

Duty of trustee of employer-sponsored fund to establish procedure

for appointing member representatives

 

  (a) if the trustee is a single corporate trustee-to have member

representatives on the board of directors of the trustee; or

  (b) if there is a group of 2 or more individual trustees-to have member

representatives included in the group; or

  (c) in any other case-to have member representatives on a policy committee

of the fund.

  (2) The trustee must:

  (a) establish (whether by inclusion in the governing rules or otherwise)

rules:

    (i) setting out a procedure for appointing the member

representatives; and

    (ii) ensuring that member representatives so appointed can

only be removed by the same procedure as that by which they were appointed,

except in the event of:

      (A) death; or

      (B) mental or physical incapacity; or

      (C) retirement; or

      (D) termination of employment; or

      (E) the member representative becoming a disqualified

person within the meaning of Part 15; or

      (F) the suspension or removal of the trustee under Part 17;

or

      (G) other prescribed circumstances; and

  (b) publish those rules in such a way as will make members of the fund aware

of the procedure for appointment and removal of member representatives.

  (3) A person who intentionally or recklessly contravenes subsection (2) is

guilty of an offence punishable on conviction by a fine not exceeding 100

penalty units.

 

  108.(1) This section applies if a standard employer-sponsored fund (other

than an excluded superannuation fund) relies on subsection 89(2) in order to

comply with the basic equal representation rules. (That subsection deals with

an additional independent trustee or an additional independent director of a

corporate trustee.)

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 108

 

Duty of trustee of employer-sponsored fund to establish procedure

for appointing independent trustee or independent member of board

of directors of corporate trustee

 

  (2) The trustee must:

  (a) establish (whether by inclusion in the governing rules or otherwise)

rules ensuring that the additional independent trustee or additional

independent director, as the case may be, can only be removed by the same

procedure as that by which the additional independent trustee or additional

independent director was appointed, except in the event of:

    (i) death; or

    (ii) mental or physical incapacity; or

    (iii) the additional independent trustee or additional

independent director, as the case may be, becoming a disqualified person

within the meaning of Part 15; or

    (iv) the suspension or removal of the trustee under Part 17;

or

    (v) other prescribed circumstances; and

  (b) publish those rules in such a way as will make members of the fund aware

of the procedure for removal of the additional independent trustee or

additional independent director, as the case may be.

  (3) A person who intentionally or recklessly contravenes subsection (2) is

guilty of an offence punishable on conviction by a fine not exceeding 100

penalty units.

 

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 109

 

 

  109.(1) The trustee or investment manager of a superannuation entity must

not invest money of the entity unless the trustee or investment manager, as

the case may be, and the other party to the relevant transaction are dealing

with each other at arm's length in respect of the transaction.

Investments of superannuation entity to be made on an arm's length basis


Back to Top

  (2) Subsection (1) is a civil penalty provision as defined by section 193,

and Part 21 therefore provides for civil and criminal consequences of

contravening, or of being involved in a contravention of, that subsection.

  (3) A contravention of subsection (1) does not affect the validity of a

transaction.

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - PART 13

 

 

  110. The object of this Part is to set out rules about the accounts of

superannuation entities.

         PART 13-ACCOUNTS OF SUPERANNUATION ENTITIES

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 110

 

Object of Part

 

 

  111.(1) The trustee of a superannuation entity must:

 

SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993 No. 78, 1993 - SECT 111

 

Accounting records

 

  (a) keep such accounting records as correctly record and explain the

transactions and financial position of the entity; and

  (b) so keep its accounting records so as to enable the following to be

prepared:

    (i) the accounts and statements of the entity mentioned in

section 112;

    (ii) the returns of the entity mentioned in section 36; and

  (c) so keep its accounting records so as to enable those accounts,

statements and returns to be conveniently and properly audited in accordance

with this Act.

  (2) If accounting records of a superannuation entity are kept in accordance