Superannuation Industry (Supervision) Act 1993

PART 11 - PROVISIONS APPLYING ONLY TO POOLED SUPERANNUATION TRUSTS  

SECTION 97   BORROWING  

97(1)   [Prohibition]  

Subject to subsection (2), the trustee of a pooled superannuation trust must not borrow money.

97(2)   [Payment to beneficiary]  

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.

97(3)   [Transaction settlements]  

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 determination made, by legislative instrument, by APRA, 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.

97(4)    
(Repealed by No 154 of 2007)