Corporations Act 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

Note: This Chapter applies to a CCIV in a modified form: see Division 4 of Part 8B.7 .

PART 7.8 - OTHER PROVISIONS RELATING TO CONDUCT ETC. CONNECTED WITH FINANCIAL PRODUCTS AND FINANCIAL SERVICES, OTHER THAN FINANCIAL PRODUCT DISCLOSURE  

Division 3 - Dealing with other property of clients  

SECTION 984B   HOW PROPERTY TO WHICH THIS DIVISION APPLIES IS TO BE DEALT WITH  

984B(1)    
Subject to subsection (2) , the licensee must ensure that property to which this Division applies is only dealt with in accordance with:

(a)    the requirements (if any) specified in regulations made for the purposes of this paragraph; and

(b)    subject to those requirements:

(i) the terms and conditions on which the property was given to the licensee; and

(ii) any subsequent instructions given by the client.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

984B(2)    
If:

(a)    the financial service referred to in subparagraph 984A(1)(a)(i) is or relates to a dealing in a derivative; or

(b)    the financial product referred to in subparagraph 984A(1)(a)(ii) is a derivative;

the property concerned may also be used for the purpose of meeting obligations incurred by the licensee in connection with margining, guaranteeing, securing, transferring, adjusting or settling dealings in derivatives by the licensee (including dealings on behalf of people other than the client).

984B(3)    

However, if the financial service or product, in connection with the property given, would be provided to the client as a retail client if:

(a)    the service or product were provided to the client when the property is given; and

(b)    section 761GA (about sophisticated investors) did not apply; and

then subsection (2) only applies to an obligation if:

(c)    the entry into of the derivative referred to in paragraph (2)(a) or (b) was or will be cleared through an authorised clearing and settlement facility; and

(d)    the licensee incurred the obligation, in connection with the derivative, under the operating rules of the facility.