ASIC Class Order [CO 01/55]

Overview

The Australian Securities and Investments CommissionCorporations Law - Clause 36 of Schedule 4 (applying section 158 of Division 2 of Part 4B of the Friendly Societies Code) - Exemption, enacted in 2001, was introduced to address a specific regulatory gap concerning the acceptance of contributions by friendly societies. This legislative instrument exempts certain individuals, such as friendly societies and their representatives, from compliance with specific sections of the Friendly Societies Code under certain conditions. The primary objective of this exemption is to ensure that friendly societies maintain compliance with the requirements to provide annual member statements and notice of material changes as outlined in AFIC Prudential Standard 6.8.4. This exemption is applicable as long as the friendly societies adhere to the specified conditions, which include the provision of appropriate disclosure documents and timely compliance with regulatory standards.

Scope and Application

The Australian Securities and Investments Commission Corporations Law, specifically clause 36 of Schedule 4, applies an exemption under section 158 of Division 2 of Part 4B of the Friendly Societies Code to certain entities and individuals. This exemption pertains to the compliance requirements set out in sections 135 and 136 of the Code concerning the acceptance of contributions made by members to a benefit fund of a friendly society, excluding their initial contribution. The exemption applies to friendly societies and their representatives as outlined in Schedule A, and it covers contributions made under the specific circumstances detailed in Schedule B. The exemption is conditional on the society complying with the annual member statements and notice of material changes requirements stipulated by AFIC Prudential Standard 6.8.4, as mentioned in Schedule C. The scope of the exemption includes entities listed in Schedule D, such as Australian Natives Association Limited and several other specified friendly societies. This legislative instrument operates within the Commonwealth jurisdiction and extends its application through subordinate schedules, ensuring that the specified conditions and compliance criteria are met by the relevant entities and individuals.

Key Provisions

The legislation in question, specifically Clause 36 of Schedule 4 applying section 158 of Division 2 of Part 4B of the Friendly Societies Code, provides an exemption for certain individuals and entities from compliance with sections 135 and 136 of the Code. These sections pertain to the acceptance of contributions to a benefit fund of a friendly society. According to the clause, the exemption applies to contributions made by members, excluding the initial contribution, under specific conditions outlined in Schedule B (paragraphs 1(a) and 1(b) of Schedule B). The conditions include the timeframe of the initial contribution and whether the member received a compliant disclosure document before making their initial contribution. The exemption is conditional upon the friendly society complying with the requirements to provide annual member statements and notice of material changes as imposed by AFIC Prudential Standard 6.8.4 (paragraph of Schedule C). The obligations imposed by the legislation on the friendly societies and their representatives are primarily related to compliance with disclosure requirements and ongoing communication with members. Friendly societies must ensure that members who made their initial contribution before certain dates (1 October 1997 or 24 May 1999, depending on the entity) or who received a compliant disclosure document are exempt from sections 135 and 136 of the Code. Furthermore, these societies must adhere to the annual member statements and notice of material changes requirement stipulated by AFIC Prudential Standard 6.8.4. This standard is applied by clause 36(1)(e) of Schedule 4 of the Corporations Law, which necessitates that societies keep members informed about their funds and any significant changes. The legislation does not explicitly state specific offences, penalties, or civil/criminal consequences for breach within the clause itself. However, breaches of the Friendly Societies Code or Corporations Law generally may lead to penalties under the relevant laws, including fines and potential imprisonment for serious offences. The exact penalties would depend on the nature and severity of the breach, and would be determined in accordance with the broader legal framework governing the Corporations Law and the Friendly Societies Code. It is essential for the friendly societies to ensure strict adherence to the conditions and requirements outlined in this clause to avoid any potential repercussions.