Notice of Approval under the Financial Sector (Shareholdings) Act 1998 – AIA International

COMMONWEALTH OF AUSTRALIA

Financial Sector (Shareholdings) Act 1998

Notice of Approval under Subsections 14(1) and 16(1)

I, JOSH FRYDENBERG, Treasurer:

•                 being satisfied that it is in the national interest, under subsections 14(1) and 16(1) of the Act, approve AIA Group Limited and each company specified in Column A of the Schedule, to hold a stake of 100 per cent in The Colonial Mutual Life Assurance Society Limited (ABN 12 004 021 809) and approve AIA Group Limited and each company specified in Column B of the Schedule, to hold a stake of 100% in AIA International Limited, subject to the conditions specified in the Schedule.

This approval comes into force on the date signed and remains in force indefinitely.

Dated: 18 September 2018

JOSH FRYDENBERG

Treasurer

Schedule

Customer data accessibility conditions

In relation to the approval granted to AIA International Limited (the Applicant) to hold a stake of 100 per cent in The Colonial Mutual Life Assurance Society Limited (CMLA), and in accordance with section 16 of the Financial Sector (Shareholdings) Act 1998 (Cth), the following conditions are imposed. These conditions apply until a Termination Event occurs.

The Applicant must use its best endeavours to ensure, and within its powers must ensure, that:

1. CMLA implements policies and procedures to ensure that the Applicant’s various directors or executive managers do not and cannot access any Customer Data, except in circumstances where access to specific Customer Data is required:
   1.   in order for the director or executive manager to discharge his or her responsibilities as a director or executive manager of the Applicant or CMLA under applicable law; or
   2.   in compliance with any law of the Commonwealth of Australia, or any of the States and Territories;

in which case the extent, form and manner of access to such Customer Data must be restricted to the bare minimum necessary for the discharge of responsibilities as a director or executive manager or to comply with the applicable law;

2.            each of the Applicant’s various directors or executive managers provide written certification on an annual basis to the Treasury by emailing FSSA-IATA@treasury.gov.au confirming that they have not accessed any Customer Data held by CMLA, except in the circumstances permitted in condition 1;

3.            CMLA implements written policies and procedures to ensure that its personnel do not and cannot disclose any Customer Data to any Offshore Investor or Offshore Personnel, or a recipient located outside Australia, except in circumstances where:

3.1.     access to specific Customer Data is required by a person to allow him or her to undertake his or her duties in the administration of life insurance services by CMLA;

3.2.     the recipient is a person located outside Australia and the recipient has requested access to their own Customer Data; or

3.3.     a person acting on behalf of a customer requires access to Customer Data about that customer in order to provide life insurance services to that customer,

in which case the extent, form and manner of disclosure of such Customer Data must be restricted to the bare minimum necessary;

4.            all Customer Data remains stored only in Australia and is accessible only from within Australia, except in the circumstances where it is required to be accessed from outside Australia in order to comply with the law of the Commonwealth of Australia, or of any of the States and Territories; and

5.            where any Customer Data is stored in the cloud by CMLA, CMLA uses a cloud provider which has been Information Security Registered Assessors Program (IRAP) certified by the Australian Signals Directorate (ASD) and which is listed on the ASD’s Certified Cloud Services.

Footnotes

1. Customer Data means any “personal information” or “sensitive information” as defined by the Privacy Act 1988 in relation to past, current and future policyholders which is held or collected by, or provided to, CMLA and each of its subsidiaries.
2. Offshore Investor means any foreign entity (including for the avoidance of doubt any foreign limited partnership) or foreign government investor holding a direct or indirect interest in CMLA.
3. Offshore Personnel means any officers, employees, consultants or contractors of an Offshore Investor who are ordinarily resident outside Australia and are not employees or officers of CMLA or its related bodies corporate (within the meaning of the Corporations Act 2001).
4. For the purposes of these conditions a Termination Event occurs when the Applicant ceases to hold an interest of more than 15 per cent in CMLA.

TAX CONDITIONS

In relation to the approval granted to AIA International Limited (the Applicant) to hold a stake of 100 per cent in The Colonial Mutual Life Assurance Society Limited (CMLA), and in accordance with section 16 of the Financial Sector (Shareholdings) Act 1998 (Cth), the following conditions are imposed. These conditions apply until a Termination Event occurs.

1. The Applicant must comply with the taxation laws of the Commonwealth of Australia in relation to the action, and any transactions, operations or assets in connection with the assets or operations acquired as a result of the action. The Applicant does not breach this condition if it has taken reasonable care to comply with the relevant taxation laws and has a reasonably arguable position.
2. The Applicant must use its best endeavours to ensure, and within its powers must ensure, that entities in its control group2 comply with the taxation laws of the Commonwealth of Australia in relation to the action and any transactions, operations or assets in connection with the assets or operations acquired as a result of the action. The Applicant does not breach this condition if entities in its control group have taken reasonable care to comply with the relevant taxation laws and have a reasonably arguable position.
3. The Applicant must provide any documents or information3 that is required to be provided to the Australian Taxation Office (ATO) in accordance with the taxation laws of the Commonwealth of Australia in relation to the action and any transactions, operations or assets in connection with assets or operations acquired as a result of the action. These documents or information must be provided within the timeframe specified by the ATO.
4. The Applicant must use its best endeavours to ensure, and within its powers must ensure, that entities in its control group provide any documents or information that is required to be provided to the ATO in accordance with the taxation laws of the Commonwealth of Australia in relation to the action and any transactions, operations or assets in connection with assets or operations acquired as a result of the action. These documents or information must be provided within the timeframe specified by the ATO.
5. The Applicant must pay its outstanding taxation debt under the taxation laws of the Commonwealth of Australia, and must use its best endeavours to ensure, and within its powers must ensure, that entities in its control group pay any outstanding taxation debt under the taxation laws of the Commonwealth of Australia, which is due and payable at the time of the proposed action. This condition does not apply to payment arrangements agreed with the ATO or where the ATO has exercised its discretion to defer part or all of the payment of a disputed amount, to the extent that those arrangements are complied with.
6. The Applicant must provide an annual report to the Treasury on compliance with these conditions. The first report must cover the period from the date the action takes place to the end of the applicant’s income year for tax purposes. All subsequent reports must cover the applicant’s income year for tax purposes. If the action takes place less than 90 days before the end of the first income year, then that period can be incorporated in the next report. Each report must be provided by the due date for lodgement of the applicant’s tax return for that year.
7. The Applicant must advise the Treasury within 60 days of taking the action that it has done so.
8. The Applicant must advise the Treasury within 60 days of a termination event that the event has taken place.

1 For the purposes of these conditions a termination event occurs:

(a)   when the applicant ceases to hold all of the interests the acquisition of which was the subject of the no objection notification;

(b)   when the applicant ceases to control, as defined in the Foreign Acquisitions and Takeovers Act 1975, the entity or business the control of which was the subject of the no objection notification;

(c)   when the applicant ceases to carry on an Australian business the starting of which was the subject of the no objection notification.

2 For the purposes of these conditions, an applicant’s control group consists of entities:

(a)   that control the applicant (a controller);

(b)   that a controller controls;

(c)   that the applicant controls, which includes for the purposes of these conditions an entity that is the subject of the application;

For the purposes of determining a control group, control has the meaning in section 50AA of the Corporations Act 2001.

3 This includes documents or information held, possessed or stored outside Australia.