Corporations Act 2001

CHAPTER 5C - MANAGED INVESTMENT SCHEMES

Modifying legislative instruments: The application of Ch 5C is affected by the following legislative instruments that commenced on or after 1 January 2022: ASIC Corporations (Asset Holding Standards for Responsible Entities) Instrument 2024/16.

PART 5C.6 - MEMBERS' RIGHTS TO WITHDRAW FROM A SCHEME

SECTION 601KA MEMBERS ' RIGHTS TO WITHDRAW

CCH Note: Section 601KA is modified by the ASIC Corporations (Investor Directed Portfolio Services Provided Through a Registered Managed Investment Scheme) Instrument 2023/668; the ASIC Corporations (Discretions for Setting the Issue Price and Withdrawal Price of Interests in Managed Investment Schemes) Instrument 2023/693; and the ASIC Corporations (Changing the Responsible Entity) Instrument 2023/681.

Withdrawal from schemes that are liquid

601KA(1)
The constitution of a registered scheme may make provision for members to withdraw from the scheme, wholly or partly, at any time while the scheme is liquid (see subsection 601GA(4) ).

Withdrawal from schemes that are not liquid

601KA(2)
The constitution of a registered scheme may make provision for members to withdraw from the scheme, wholly or partly, in accordance with this Part while the scheme is not liquid (see subsection 601GA(4) ).

Restrictions on withdrawal from schemes

601KA(3)
The responsible entity must not allow a member to withdraw from the scheme:

(a) if the scheme is liquid - otherwise than in accordance with the scheme ' s constitution; or

(b) if the scheme is not liquid - otherwise than in accordance with the scheme ' s constitution and sections 601KB to 601KE .

601KA(3A)

View history reference

An offence based on subsection (3) is an offence of strict liability.

Note: For strict liability , see section 6.1 of the Criminal Code .

View history note

Liquid schemes

601KA(4)
A registered scheme is liquid if liquid assets account for at least 80% of the value of scheme property.

Liquid assets

601KA(5)
The following are liquid assets unless it is proved that the responsible entity cannot reasonably expect to realise them within the period specified in the constitution for satisfying withdrawal requests while the scheme is liquid:

(a) money in an account or on deposit with a bank;

(b) bank accepted bills;

(c) marketable securities (as defined in section 9 );

(d) property of a prescribed kind.

601KA(6)
Any other property is a liquid asset if the responsible entity reasonably expects that the property can be realised for its market value within the period specified in the constitution for satisfying withdrawal requests while the scheme is liquid.

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