Superannuation Industry (Supervision) Regulations (Amendment) (Cth)

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Statutory Rules 1995

No. 384 1

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Superannuation Industry (Supervision) Regulations 2(Amendment)

I, THE GOVERNOR-GENERAL of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, make the following Regulations under the Superannuation Industry (Supervision) Act 1993.

Dated 29 November 1995.

 BILL HAYDEN

 Governor-General

By His Excellency’s Command,

PAUL ELLIOTT

Parliamentary Secretary to the Treasurer

for the

Treasurer

____________

1.   Commencement

1.1 Regulation 5 commences on 1 July 1996.

 

[NOTE: The remainder of these Regulations commence on gazettal: see Acts Interpretation Act 1901, s. 48.]

2.   Amendment

2.1   The Superannuation Industry (Supervision) Regulations are amended as set out in these Regulations.

3.   Regulation 1.03 (Interpretation)

3.1   Subregulation 1.03 (3):

Omit the subregulation, substitute:

“(3)

For the purposes of the definition of ‘protected member’ in subregulation (1), a benefit in a fund is taken to contain or to have contained mandated employer-financed benefits unless:

  • (a)

    if the benefits arose in relation to contributions made before 1 July 1995—the trustee of the fund reasonably believes otherwise; or

  • (b)

    if the benefits arose in relation to contributions made on or after 1 July 1995—the trustee of the fund knows otherwise.”.

4. Regulation 2.05

(Members to whom trustees are not required to give information)

4.1   Subparagraph 2.05 (1) (a) (i):

Omit “or”, substitute “and”.

4.2   Subregulation 2.05 (1):

Add at the end:

  • “; or (c)

    the member was transferred to the superannuation entity and, at the time of the transfer, the trustee of the transferor fund has fulfilled the requirements of paragraph (a) or (b) in relation to the member.”. 

5.   Regulation 4.09 (Operating standard—investment strategy)

5.1   Subregulation 4.09 (1):

Omit “that are not excluded funds”.

6.   Regulation 5.01 (Interpretation)

6.1   Subregulation 5.01 (2):

Omit “employer-financed contribution.”, substitute “employer contribution.”.

7.   Regulation 5.14 (Member-protection standards not to apply to certain funds)

7.1   Subregulations 5.14 (1A) and (2):

Omit the subregulations and the note, substitute:

“(2)

The member-protection standards do not apply to a unitised fund if:

  • (a)

    a single price is applicable both to the buying and selling of units in the fund and all the administration costs of the fund are reflected in that price; or

  • (b)

    separate prices are applicable, respectively, to the buying and selling of units in the fund and:

    • (i)

      the price differential, also known as the buy/sell cost spread, is solely attributable to outgoings comprising:

      • (A)

        brokerage costs; and

      • (B)

        fees and charges charged against a member’s benefits that are excluded from the definition of ‘administration costs’ under paragraphs (a), (b) and (c) of that definition in subregulation 5.01 (1); and

    • (ii)

      the brokerage costs referred to in sub-subparagraph (i) (A), if any, are applied proportionally in relation to all units in the fund; and

    • (iii)

      all the administration costs of the fund, except for any brokerage costs applied in accordance with sub-subparagraph (i) (A) and subparagraph (ii), are reflected in both the buy price and the sell price of the units; or

  • (c)

    the administration costs of the fund are not wholly reflected in the price, or prices, of units in the fund but the benefits of its members are protected in a way that is consistent with the member-protection standards. 

 “(3)The member protection standards do not apply to a fund that is not a unitised fund if all of the administration costs of the fund are applied to each member in direct proportion to:

  • (a)

    the investment return credited to, or debited against, the member; or

  • (b)

    the member’s benefits.”.

8.   New regulations 5.15C and 5.15D

8.1   After regulation 5.15B, insert:

Member-protection standards not to apply to pensions

“5.15C.

The member-protection standards do not apply to any part of a member’s benefits which has commenced to be taken in the form of a pension. 

Member-protection standards not to apply to traditional life insurance policies

“5.15D.

The member-protection standards do not apply to a part of a member’s benefits that is wholly determined by a life insurance policy within the meaning of the Life Insurance Act 1995 if:

  • (a)

    the policy includes an investment component; and

  • (b)

    the premium is not dissected (whether by reference to the investment component or otherwise); and

  • (c)

    the sum insured, together with bonuses (if any), is payable only upon:

    • (i)

      the death of the life insured; or

    • (ii) 

      the occurrence of the earlier of the following events:

      • (A)

        the death of the life insured; or

      • (B)

        the attainment by the life insured of the age specified in the policy.”.

9.   Regulation 5.17 (Member-protection standards)

9.1   Paragraph 5.17 (9) (b):

After “protected member”, insert “and lost member”.

9.2   Subregulation 5.17 (10):

Omit the subregulation, substitute:

“(10)

For the purposes of this regulation, a member’s benefits are taken to be composed wholly of mandated employer-financed benefits except for:

  • (a)

    the portion (if any) of the benefits that:

    • (i)

      arose in relation to contributions made before 1 July 1995; and

    • (ii)

      the trustee reasonably believes are not mandated employer-financed benefits; and

  • (b)

    the portion (if any) of the benefits that:

    • (i)

      arose in relation to contributions made on or after 1 July 1995; and

    • (ii)

      the trustee knows are not mandated employer-financed benefits.”.

10.   Regulation 11.08 (Information regarding lost members to be provided to Commissioner)

10.1   Paragraph 11.08 (3) (a):

Omit the paragraph, substitute:

  • “(a)

    each lost member of the fund who became reportable during the half-year, unless:

    • (i)

      the member ceased to be a member of the fund; or

    • (ii)

      the member ceased to be lost; or

    • (iii)

      the member was previously reported under this paragraph and the trustee reasonably believes that the member is recorded as lost on the register of lost members; and”.

NOTES

1. Notified in the Commonwealth of Australia Gazette on 6 December 1995.

2. Statutory Rules 1994 No. 57 as amended by 1994 Nos. 189 and 432; 1995 Nos. 47, 64, 142, 158, 159, 240 and 293.

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