SUPERANNUATION LEGISLATION AMENDMENT (FURTHER MYSUPER AND TRANSPARENCY MEASURES) BILL 2012

i Superannuation Legislation Amendment (Further MySuper and Transparency Measures)

Bill 2012 No. , 2012

Contents

1 Short

title

...........................................................................................

2 Commencement

.................................................................................

3 Schedule(s)

........................................................................................

Schedule 1--Fees and costs

Part 1--Amendments

Superannuation Industry (Supervision) Act 1993

Part 2--Application

Schedule 2--Provision of benefits

Part 1--Amendments

Superannuation Guarantee (Administration) Act 1992

Superannuation Industry (Supervision) Act 1993

Part 2--Application

Schedule 3--Collection and disclosure of information

Part 1--Amendments

Australian Prudential Regulation Authority Act 1998

Corporations Act 2001

Financial Sector (Collection of Data) Act 2001

Superannuation Industry (Supervision) Act 1993

Part 2--Application and transitional provisions

Schedule 4--Modern awards and enterprise agreements

Part 1--Amendments

Fair Work Act 2009

Superannuation Guarantee (Administration) Act 1992

Superannuation Industry (Supervision) Act 1993

Part 2--Transitional

Schedule 5--Defined benefit members

Superannuation Guarantee (Administration) Act 1992

Superannuation Industry (Supervision) Act 1993

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 ii

Schedule 6--Moving accrued default amounts

Superannuation Industry (Supervision) Act 1993

Schedule 7--Eligible rollover funds

Part 1--Main amendments

Superannuation Industry (Supervision) Act 1993

Part 2--Other amendments

Retirement Savings Accounts Act 1997

Schedule 8--Other amendments

Superannuation Guarantee (Administration) Act 1992

Superannuation Industry (Supervision) Act 1993

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 1

A Bill for an Act to amend the law in relation to

superannuation and for related purposes

The Parliament of Australia enacts:

1 Short title

This Act may be cited as the Superannuation Legislation

Amendment (Further MySuper and Transparency Measures) Act

2012.

2 Commencement

(1) Each provision of this Act specified in column 1 of the table

commences, or is taken to have commenced, in accordance with

column 2 of the table. Any other statement in column 2 has effect

according to its terms.

2 Superannuation Legislation Amendment (Further MySuper and Transparency Measures)

Bill 2012 No. , 2012

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

1. Sections 1 to 3

and anything in

this Act not

elsewhere covered

by this table

The day this Act receives the Royal Assent.

2. Schedule 1,

items 1 to 6

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

3. Schedule 1,

item 7

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

However, the provision(s) do not commence

at all if item 1 of Schedule 3 to the

Superannuation Laws Amendment (Capital

Gains Tax Relief and Other Efficiency

Measures) Act 2012 commences on or

before that time.

4. Schedule 1,

items 8 to 16

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

5. Schedule 1,

items 17 and 18

Immediately after the commencement of the

provision(s) covered by table item 24.

6. Schedule 1,

items 19 and 20

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

7. Schedule 1,

item 21

Immediately after the commencement of the

provision(s) covered by table item 24.

8. Schedule 1,

items 22 to 36

Immediately after the commencement of

item 9 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

9. Schedule 1,

items 37 and 38

The day after this Act receives the Royal

Assent.

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 3

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

10. Schedule 1,

item 39

Immediately after the commencement of the

provision(s) covered by table item 24.

11. Schedule 1,

items 40 and 41

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

12. Schedule 2,

item 1

Immediately after the commencement of

item 1 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

13. Schedule 2,

items 2 to 4

1 July 2013.

1 July 2013

14. Schedule 2,

item 5

The day this Act receives the Royal Assent.

15. Schedule 2,

items 6 and 7

1 July 2013.

1 July 2013

16. Schedule 3,

items 1 to 39

1 July 2013.

1 July 2013

17. Schedule 3,

item 40

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

18. Schedule 3,

items 41 to 47

1 July 2013.

1 July 2013

19. Schedule 4,

items 1 to 8

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

20. Schedule 4,

items 9 and 10

1 January 2014.

1 January 2014

21. Schedule 4,

items 11 to 13

Immediately after the commencement of the

provision(s) covered by table item 24.

22. Schedule 5,

items 1 to 3

1 January 2014.

1 January 2014

23. Schedule 5,

items 4 to 10

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

4 Superannuation Legislation Amendment (Further MySuper and Transparency Measures)

Bill 2012 No. , 2012

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

Legislation Amendment (MySuper Core

Provisions) Act 2012.

24. Schedule 6

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

25. Schedule 7

1 July 2013.

1 July 2013

26. Schedule 8,

item 1

Immediately after the commencement of

item 1 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

27. Schedule 8,

item 2

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

However, the provision(s) do not commence

at all unless item 1 of Schedule 3 to the

Superannuation Laws Amendment (Capital

Gains Tax Relief and Other Efficiency

Measures) Act 2012 commences on or

before that time.

28. Schedule 8,

item 3

Immediately after the commencement of

item 2 of Schedule 1 to the Superannuation

Legislation Amendment (MySuper Core

Provisions) Act 2012.

Note:

This table relates only to the provisions of this Act as originally

enacted. It will not be amended to deal with any later amendments of

this Act.

(2) Any information in column 3 of the table is not part of this Act.

Information may be inserted in this column, or information in it

may be edited, in any published version of this Act.

3 Schedule(s)

Each Act that is specified in a Schedule to this Act is amended or

repealed as set out in the applicable items in the Schedule

Schedule 1 Fees and costs

Part 1 Amendments

6 Superannuation Legislation Amendment (Further MySuper and Transparency Measures)

Bill 2012 No. , 2012

Schedule 1--Fees and costs

Part 1--Amendments

Superannuation Industry (Supervision) Act 1993

1 Section 4 (after table item dealing with Part No. 11)

Insert:

11A

General fees rules

2 Subparagraph 6(1)(a)(v)

Repeal the subparagraph, substitute:

(v) Parts 8 to 11A (other than section 99F);

3 Before subparagraph 6(1)(c)(ii)

Insert:

(iia) section 99F; and

4 Subsection 10(1)

Insert:

activity fee has the meaning given by subsection 29V(7).

5 Subsection 10(1)

Insert:

administration fee has the meaning given by subsection 29V(2).

6 Subsection 10(1)

Insert:

advice fee has the meaning given by subsection 29V(8).

7 Subsection 10(1)

Insert:

buy-sell spread has the meaning given by subsection 29V(4).

8 Subsection 10(1)

Fees and costs Schedule 1

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 7

Insert:

entry fee has the meaning given by subsection 99B(2).

9 Subsection 10(1)

Insert:

exit fee has the meaning given by subsection 29V(6).

10 Subsection 10(1)

Insert:

financial product has the same meaning as in Chapter 7 of the

Corporations Act 2001.

11 Subsection 10(1)

Insert:

financial product advice has the same meaning as in Chapter 7 of

the Corporations Act 2001.

12 Subsection 10(1)

Insert:

general fees rules means the rules in Part 11A.

13 Subsection 10(1)

Insert:

insurance fee has the meaning given by subsection 29V(9).

14 Subsection 10(1)

Insert:

investment fee has the meaning given by subsection 29V(3).

15 Subsection 10(1)

Insert:

personal advice has the same meaning as in Chapter 7 of the

Corporations Act 2001.

Schedule 1 Fees and costs

Part 1 Amendments

8 Superannuation Legislation Amendment (Further MySuper and Transparency Measures)

Bill 2012 No. , 2012

16 Subsection 10(1)

Insert:

switching fee has the meaning given by subsection 29V(5).

17 At the end of paragraph 29S(2)(f)

Add:

; (iii) section 29SAC.

18 After section 29SAB

Insert:

29SAC Election not to charge MySuper members for payment of

conflicted remuneration

(1) An RSE licensee that applies for authority to offer a class of

beneficial interest in a regulated superannuation fund as a MySuper

product makes an election in accordance with this section if:

(a) the RSE licensee elects that, if the authority is given, the RSE

licensee will not charge any MySuper member a fee in

relation to the MySuper product, all or part of which relates

directly or indirectly to costs incurred by a trustee or the

trustees of the fund:

(i) in paying conflicted remuneration to a financial services

licensee, or a representative of a financial services

licensee; or

(ii) in paying an amount to another person that a trustee of

the fund knows, or reasonably ought to know, relates to

conflicted remuneration paid by that other person to a

financial services licensee, or a representative of a

financial services licensee; and

(b) the election is in writing; and

(2) In this section:

conflicted remuneration has the same meaning as in Part 7.7A of

the Corporations Act 2001, subject to the extension of that

meaning in subsection (3).

Fees and costs Schedule 1

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 9

representative, of a financial services licensee, has the same

meaning as in Part 7.6 of the Corporations Act 2001.

(3) In this section, conflicted remuneration also has the meaning it

would have if:

(a) financial product advice provided to the RSE licensee

mentioned in subsection (1) by a financial services licensee,

or a representative of a financial services licensee, mentioned

in subparagraph (1)(a)(i) or (ii) were provided to the RSE

licensee as a retail client; and

(b) financial product advice provided to the other person

mentioned in subparagraph (1)(a)(ii) by a financial services

licensee, or a representative of a financial services licensee,

mentioned in that subparagraph were provided to the other

person as a retail client.

19 Paragraph 29T(1)(i)

After "is likely to comply with", insert "the general fees rules and".

20 Paragraph 29U(2)(d)

After "is likely to comply with", insert "the general fees rules and".

21 At the end of subsection 29U(2)

Add:

; or (k) APRA is satisfied that the RSE licensee has failed to give

effect to an election made in accordance with section 29SAC

(election not to pass costs of conflicted remuneration to

MySuper members).

22 At the end of subsection 29V(1)

Add:

; (g) an advice fee;

(h) an insurance fee.

23 Subsection 29V(2)

Omit "the fund" (first occurring), substitute "a superannuation entity".

24 Subsection 29V(2)

Schedule 1 Fees and costs

Part 1 Amendments

10 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Omit "the fund (that are not otherwise charged as an investment fee, a

buy-sell spread, a switching fee, an exit fee or an activity fee)",

substitute "the entity that:

(a) relate to the administration or operation of the fund; and

(b) are not otherwise charged as an investment fee, a buy-sell

spread, a switching fee, an exit fee, an activity fee, an advice

fee or an insurance fee".

25 Subsection 29V(3)

Omit "the fund" (first occurring), substitute "a superannuation entity".

26 Paragraph 29V(3)(b)

Omit "the fund (that are not otherwise charged as an administration fee,

a buy-sell spread, a switching fee, an exit fee or an activity fee)",

substitute "the entity that:

(i) relate to the investment of assets of the entity; and

(ii) are not otherwise charged as an administration fee, a

buy-sell spread, a switching fee, an exit fee, an activity

fee, an advice fee or an insurance fee".

27 Subsection 29V(4)

After "or the trustees,", insert "of a superannuation entity".

28 Subsection 29V(4)

Omit "the fund", substitute "the entity".

29 Subsection 29V(5)

Repeal the subsection, substitute:

(5)

switching fee is a fee to recover the costs of switching all or part

of a member's interest in a superannuation entity from one class of

beneficial interest in the entity to another.

30 Subsection 29V(6)

Omit "the fund", substitute "a superannuation entity".

31 Subsection 29V(7)

Repeal the subsection, substitute:

(7) A fee is an activity fee if:

Fees and costs Schedule 1

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 11

(a) the fee relates to costs incurred by the trustee, or the trustees,

of a superannuation entity that are directly related to an

activity of the trustee, or the trustees:

(i) that is engaged in at the request, or with the consent, of

a member; or

(ii) that relates to a member and is required by law; and

(b) those costs are not otherwise charged as an administration

fee, an investment fee, a buy-sell spread, a switching fee, an

exit fee, an advice fee or an insurance fee.

(8) A fee is an advice fee if:

(a) the fee relates directly to costs incurred by the trustee, or the

trustees, of a superannuation entity because of the provision

of financial product advice to a member by:

(i) a trustee of the entity; or

(ii) another person acting as an employee of, or under an

arrangement with, a trustee or trustees of the entity; and

(b) those costs are not otherwise charged as an administration

fee, an investment fee, a switching fee, an exit fee, an activity

fee or an insurance fee.

(9) A fee is an insurance fee if:

(a) the fee relates directly to either or both of the following:

(i) insurance premiums paid by the trustee, or the trustees,

of a superannuation entity in relation to a member or

members of the entity;

(ii) costs incurred by the trustee, or the trustees, of a

superannuation entity in relation to the provision of

insurance for a member or members of the entity; and

(b) the fee does not relate to any part of a premium paid or cost

incurred in relation to a life policy or a contract of insurance

that relates to a benefit to the member that is based on the

performance of an investment rather than the realisation of a

risk; and

otherwise charged as an administration fee, an investment

fee, a switching fee, an exit fee, an activity fee or an advice

fee.

32 Subsection 29VA(1)

Schedule 1 Fees and costs

Part 1 Amendments

12 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

After "may only charge a fee", insert "in relation to the MySuper

product".

33 At the end of section 29VA

Add:

Advice fees

(9) This rule is satisfied if:

(a) the fee is an advice fee that relates directly to financial

product advice provided to a member; and

(b) the member holds a MySuper product; and

Insurance fees

(10) This rule is satisfied if:

(a) the fee is an insurance fee that relates directly to either or

both of the following:

(i) insurance premiums paid by the trustee, or the trustees,

of a superannuation entity in relation to a member;

(ii) costs incurred by the trustee, or the trustees, of a

superannuation entity in relation to the provision of

insurance for a member; and

(b) the member holds a MySuper product; and

34 Paragraph 29VB(1)(d)

Repeal the paragraph, substitute:

(d) the fee is in accordance with subsection (2), (3) or (4); and

(e) the fee is in accordance with subsection (5).

35 At the end of section 29VB

Add:

(5) The total amount of the administration fee charged in relation to

the employee members is at least equal to an amount that

reasonably relates to costs that:

Fees and costs Schedule 1

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 13

(a) are incurred by the trustee, or the trustees, of the fund in the

administration and operation of the fund in relation to those

members; and

(b) are not otherwise charged as an investment fee, a buy-sell

spread, a switching fee, an exit fee, an activity fee, an advice

fee or an insurance fee.

36 At the end of Division 5 of Part 2C

Add:

29VC Activity fees and insurance fees to be charged on a cost

recovery basis

(1) If the trustee, or the trustees, of a regulated superannuation fund

charge an activity fee or an insurance fee to a member in relation to

a MySuper product, the fee must be no more than it would be if it

were charged on a cost recovery basis.

(2) The regulations may prescribe the way in which an activity fee or

an insurance fee charged on a cost recovery basis is to be worked

out.

29VD Performance-based fees

(1) This section applies if:

(a) a regulated superannuation fund offers a MySuper product;

and

(b) the trustee, or the trustees, of the fund enter into an

arrangement with an investment manager for the investment

of an asset or assets of the fund attributed, in whole or in part,

to the MySuper product; and

manager is determined, in whole or in part, by reference to

the performance of the investments made by the investment

manager on behalf of the trustee or trustees of the fund (a

performance-based fee).

(2) The trustee, or the trustees, of the regulated superannuation fund

must ensure that the arrangement complies with this section.

Schedule 1 Fees and costs

Part 1 Amendments

14 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Base fee must be set or adjusted to give incentive to obtain

performance-based fee

(3) If, under the arrangement, a fee is or fees are payable to the

investment manager in addition to the performance-based fee, the

other fee or fees must be set or adjusted so that they are lower than

they would be if the arrangement did not include the

performance-based fee.

Period to which performance-based fee relates

(4) The period over which entitlement to the performance-based fee is

determined under the arrangement must be appropriate to the kinds

of investment to which the performance-based fee relates.

Performance of investment must be measured against an

appropriate benchmark

(5) Under the arrangement, the performance of the investment must be

measured by comparison with the performance of investments of a

similar kind.

Performance-based fee to be worked out on after-costs, after-tax

basis

(6) For the purposes of working out the performance-based fee

payable under the arrangement, the performance of the investment

must be determined on an after-costs and, where possible, an

after-tax basis.

Disincentives to underperformance

(7) Under the arrangement, the performance-based fee must be

calculated in a way that includes disincentives for poorly

performing investments.

Best interests of MySuper members

(8) A trustee of a regulated superannuation fund does not breach this

section to the extent that the asset or assets of the fund invested

under the arrangement are attributed by the trustee or the trustees

of the fund to a MySuper product if, despite the fact that the

arrangement does not comply with one or more of the provisions of

Fees and costs Schedule 1

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 15

this section, the arrangement promotes the financial interests of the

beneficiaries of the fund who hold the MySuper product.

37 After paragraph 31(2)(d)

Insert:

(da) the charging of fees (including the calculation of the amount

of fees) to:

(i) members of a fund; and

(ii) members who hold a particular class of beneficial

interest in a fund;

(db) the attribution of costs between classes of beneficial interest

in a fund;

38 After section 33

Insert:

33A Relationship between operating standards, this Act and the

regulations

(1) A standard applicable to the operation of a superannuation entity

may be prescribed that elaborates, supplements or otherwise deals

with any aspect of:

(a) a matter relating to the operation of the entity to which a

covenant referred to in sections 52 to 53 or prescribed under

section 54A relates; or

(b) a matter relating to the operation of the entity to which a

provision of this Act or another provision of the regulations

relates.

(2) However, a standard applicable to the operation of a

superannuation entity is of no effect to the extent that it conflicts

with this Act.

39 At the end of section 55B

Add:

;or (d) an election made in accordance with section 29SAC (election

not to pass costs of paying conflicted remuneration onto

MySuper members).

40 After Part 11

Schedule 1 Fees and costs

Part 1 Amendments

16 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Add:

Part 11A--General fees rules

99A Application

The rules set out in this Part do not apply to self managed

superannuation funds.

99B No entry fees

(1) The trustee, or the trustees, of a regulated superannuation fund or

an approved deposit fund must not charge entry fees.

(2)

entry fee is a fee, other than a buy-sell spread, that relates,

directly or indirectly, to the issuing of a beneficial interest in a

superannuation entity to a person who is not already a member of

the entity.

99C Buy-sell spreads, switching fees and exit fees to be charged on a

cost recovery basis

(1) If the trustee, or the trustees, of a regulated superannuation fund or

an approved deposit fund charge a buy-sell spread, a switching fee

or an exit fee, the fee must be no more than it would be if it were

charged on a cost recovery basis.

(2) The regulations may prescribe the way in which a buy-sell spread,

a switching fee or an exit fee charged on a cost recovery basis is to

be worked out.

99D Cost of advice to employers not to be borne by members

The trustee, or the trustees, of a regulated superannuation fund or

an approved deposit fund must not include in any fee charged to

any member of the fund an amount that relates to costs incurred by

any person, directly or indirectly, in relation to personal advice

provided by any person to an employer of one or more members of

the fund.

Fees and costs Schedule 1

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 17

99E Fair and reasonable attribution of costs between classes of

beneficial interest in a regulated superannuation fund

If there is more than one class of beneficial interest in a regulated

superannuation fund, the trustee, or the trustees, of the fund must

attribute the costs of the fund between the classes fairly and

reasonably.

99F Cost of financial product advice

(1) The trustee or the trustees of a regulated superannuation fund must

not directly or indirectly pass the cost of providing financial

product advice in relation to a member of the fund (the subject

member) on to any other member of the fund, to the extent that:

(a) the advice is provided by:

(i) a trustee of the fund; or

(ii) another person acting as an employee of, or under an

arrangement with, a trustee or trustees of the fund; and

(b) the advice is personal advice; and

(i) the subject member has not yet acquired a beneficial

interest in the fund when the advice is given, and the

advice relates to whether the subject member should

acquire such an interest;

(ii) the advice relates to a financial product that is not a

beneficial interest in the fund, a related pension fund for

the member and the fund, a related insurance product

for the member and the fund or a cash management

facility;

(iii) the advice relates to whether the subject member should

consolidate that member's beneficial interests in 2 or

more superannuation entities into a beneficial interest in

a single superannuation entity;

(iv) at the time the advice is provided, the subject member

reasonably expects that a person mentioned in

subparagraph (a)(i) or (ii) will periodically review the

advice, provide further personal advice or monitor

whether recommendations in the original or any later

advice are implemented and the results of that

implementation;

Schedule 1 Fees and costs

Part 1 Amendments

18 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(v) other prescribed circumstances.

(2)

If:

(a) under the governing rules of a regulated superannuation fund

(the first fund):

(i) a member of another regulated superannuation fund (the

second fund) is entitled to become a member of the first

fund on the satisfaction of a condition of release of

benefits specified in a standard made under paragraph

31(2)(h); and

(ii) on becoming a member of the first fund, a pension

would be payable out of the assets of the first fund to

the member; and

(b) the RSE licensee for the first fund is, or is an associate of, the

RSE licensee of the second fund;

then the first fund is a related pension fund of the second fund for

a member of the second fund in relation to whom paragraph (a) is

satisfied.

(3)

If:

(a) the trustee, or the trustees, of a regulated superannuation fund

provide a benefit to members of the fund who hold a

particular class of beneficial interest in the fund by taking out

insurance; and

(b) a person holds a beneficial interest of that class in the fund,

or is considering acquiring a beneficial interest of that class

in the fund;

a life policy or contract of insurance by which that benefit is or

would be provided is a related insurance product for the person

and the fund.

(4) In this section:

cash management facility has the same meaning as it has for the

purposes of subsection 946B(1) of the Corporations Act 2001.

life policy has the same meaning as in the Life Insurance Act 1995.

Fees and costs Schedule 1

Application Part 2

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 19

Part 2--Application

41 Application of general fees rules

(1)

Subject to subitems (2) and (3), the amendment made by item 40 of this

Schedule applies in relation to:

(a) fees charged, and costs passed on, to members of regulated

superannuation funds and approved deposit funds on and

after 1 July 2013; and

(b) costs attributed to classes of beneficial interest in a regulated

superannuation fund on and after 1 July 2013.

(2)

The amendment made by item 40 of this Schedule does not apply to a

fee charged, or a cost passed on, to a member of a regulated

superannuation fund or an approved deposit fund to the extent that it

relates to a life policy if:

(a) the life policy is one under which contributions and

accumulated earnings may not be reduced by negative

investment returns or any reduction in the value of assets in

which the policy is invested; and

(b) the member was covered under the life policy immediately

before 1 July 2013.

(3)

The amendment made by item 40 of this Schedule does not apply to a

fee charged, or a cost passed on, to a member of a regulated

superannuation fund or an approved deposit fund to the extent that it

relates to an investment account contract if:

(a) the investment account contract is one under which the only

beneficiaries are the member, and relatives and dependants of

the member; and

(b) the investment account contract was in force immediately

before 1 July 2013.

(4)

In this item:

investment account contract has the same meaning as in the Life

Insurance Act 1995.

life policy has the same meaning as in the Life Insurance Act 1995.

Schedule 2 Provision of benefits

Part 1 Amendments

20 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Schedule 2--Provision of benefits

Part 1--Amendments

Superannuation Guarantee (Administration) Act 1992

1 Paragraph 32C(2)(d)

Repeal the paragraph, substitute:

(d) the fund complies with the requirements (if any) set out in the

regulations in relation to the provision of a benefit in respect

of MySuper members of the fund that is payable only in the

event of the death of the member; and

(e) the fund complies with the requirements (if any) set out in the

regulations in relation to offering a benefit in respect of

members of the fund (other than MySuper members) that is

payable only in the event of the death of the member.

Superannuation Industry (Supervision) Act 1993

2 Subsection 10(1)

Insert:

death benefit: see section 68AA.

3 Subsection 10(1)

Insert:

permanent incapacity: a member of a superannuation fund or an

approved deposit fund is suffering permanent incapacity if the

member is taken, under the regulations, to be suffering permanent

incapacity for the purposes of this Act.

4 Subsection 10(1)

Insert:

permanent incapacity benefit: see section 68AA.

5 After paragraph 31(2)(e)

Insert:

Provision of benefits Schedule 2

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 21

(ea) the kinds of benefits that must not be provided by taking out

insurance, or insurance of a particular kind;

(eb) the kinds of benefits that must not be provided other than by

taking out insurance, or insurance of a particular kind;

6 After section 68

Insert:

68AA Benefits for permanent incapacity and death--MySuper

members

Requirement to provide permanent incapacity benefit and death

benefit by taking out insurance

(1) Each trustee of a regulated superannuation fund must ensure the

following:

(a) that the fund provides permanent incapacity benefit to each

MySuper member of the fund;

(b) that the fund provides death benefit in respect of each

MySuper member of the fund;

provided by taking out insurance.

Note:

A failure to comply with subsection (1) is a breach of a condition of

the RSE licence (see paragraph 29E(1)(a)).

(2) The trustees of a regulated superannuation fund are not required to

provide permanent incapacity benefit or death benefit if the

conditions determined under subsection (3) in relation to the

benefit are not met.

(3) The trustees of a regulated superannuation fund may determine

reasonable conditions to which the provision of:

(a) permanent incapacity benefit; or

(b)

death

benefit;

is subject.

(4) Without limiting subsection (3), conditions determined under

subsection (3) in relation to a benefit are reasonable if they are the

same as the terms and conditions of the policy of insurance taken

out to provide the benefit.

Schedule 2 Provision of benefits

Part 1 Amendments

22 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Requirement to allow MySuper members to elect not to receive

permanent incapacity benefit or death benefit

(5) Each trustee of a regulated superannuation fund must ensure that

each MySuper member of the fund may elect either or both of the

following:

(a) that permanent incapacity benefit will not be provided to the

member by the fund;

(b) that death benefit will not be provided in respect of the

member by the fund.

Note:

A failure to comply with subsection (5) is a breach of a condition of

the RSE licence (see paragraph 29E(1)(a)).

(6) The trustees of a regulated superannuation fund may require that

MySuper members who wish to make an election in accordance

with subsection (5) must make the election in relation to both

permanent incapacity benefit and death benefit.

(7) Subsection (5) does not apply to a MySuper member of a regulated

superannuation fund if the circumstances prescribed by the

regulations for the purposes of this subsection are met.

(8) If a MySuper member of a regulated superannuation fund makes an

election in accordance with subsection (5) in relation to a benefit,

subsection (1) does not apply in relation to the member and the

benefit.

(9) This section does not apply to a defined benefit member.

Death benefit and permanent incapacity benefit

(10) For the purposes of this Act:

death benefit means a benefit provided in respect of a member of a

regulated superannuation fund in, and only in, the event of the

death of the member.

permanent incapacity benefit means a benefit provided to a

member of a regulated superannuation fund if, and only if, the

member is suffering permanent incapacity.

Provision of benefits Schedule 2

Application Part 2

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 23

Part 2--Application

7 Elections made before commencement

(1)

This item applies if:

(a) before the commencement of this item, a MySuper member

of a regulated superannuation fund elected either or both of

the following:

(i) that a benefit of a kind referred to in paragraph

68AA(1)(a) of the new Act will not be provided to the

member by the fund;

(ii) that a benefit referred to in paragraph 68AA(1)(b) of the

new Act will not be provided in respect of the member

by the fund; and

(b) as at the commencement of this item, the election is in force.

(2)

Subsection 68AA(8) of the new Act applies in relation to the MySuper

member as if the election were an election made by the member,

immediately after the commencement of this item, in accordance with

subsection 68AA(5) in relation to the benefit or benefits (as the case

may be).

(3)

Subsection 68AA(6) of the new Act does not apply in relation to the

election.

(4)

In this item:

new Act means the Superannuation Industry (Supervision) Act 1993 as

in force immediately after the commencement of this item.

Schedule 3 Collection and disclosure of information

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24 Superannuation Legislation Amendment (Further MySuper and Transparency

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Schedule 3--Collection and disclosure of

information

Part 1--Amendments

Australian Prudential Regulation Authority Act 1998

1 Subsection 56(1) (after paragraph (c) of the definition of

protected document)

Insert:

; or (ca) a person in relation to whom information is, or was, required

to be given under a reporting standard made in accordance

with subsection 13(4A) of the Financial Sector (Collection of

Data) Act 2001;

2 Subsection 56(1) (after paragraph (c) of the definition of

protected information)

Insert:

; or (ca) a person in relation to whom information is, or was, required

to be given under a reporting standard made in accordance

with subsection 13(4A) of the Financial Sector (Collection of

Data) Act 2001;

3 Subsection 56(5C)

Repeal the subsection, substitute:

(5C)

If:

(a) a document is a reporting document given to APRA under

section 13 of the Financial Sector (Collection of Data) Act

2001; and

(b)

either:

(i) a determination has been made under section 57 that the

document does not, or documents of that kind do not,

contain confidential information; or

(ii) a determination has been made under section 57 that a

specified part of the document, or of documents of that

kind, does not contain confidential information;

Collection and disclosure of information Schedule 3

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2012 No. , 2012 25

it is not an offence to disclose the document or that part of the

document, or any information contained in the document or that

part of the document, to any person (including by making the

document, the part of the document or the information available on

APRA's website).

4 Section 57

Repeal the section, substitute:

57 Determination of confidentiality

(1) This section applies in relation to reporting documents that are

required to be given to APRA under section 13 of the Financial

Sector (Collection of Data) Act 2001 by:

(a) a registered entity; or

(b) a body regulated by APRA.

A reporting document of that kind is referred to in this section as a

relevant reporting document.

(2) APRA may determine, by legislative instrument, that:

(a) all or a specified part of a relevant reporting document

contains, or does not contain, confidential information; or

(b) all or a specified part of relevant reporting documents of a

specified kind contains, or do not contain, confidential

information.

(3) APRA must not make a determination under subsection (2) unless

APRA gives interested parties for the determination a reasonable

opportunity to make representations as to whether or not the

relevant reporting document contains, or relevant reporting

documents of that kind contain, confidential information.

(4) APRA may determine that:

(a) all or a specified part of a relevant reporting document does

not contain confidential information; or

(b) all or a specified part of relevant reporting documents of a

specified kind do not contain confidential information;

if, taking into account any representations made under

subsection (3) in relation to the document or documents of that

kind, APRA considers that the benefit to the public from the

disclosure of the document or documents, or information contained

Schedule 3 Collection and disclosure of information

Part 1 Amendments

26 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

in the document or documents, outweighs any detriment to

commercial interests that the disclosure may cause.

(5) In this section:

interested party, for a determination, means:

(a) if the determination is to relate to all or a specified part of a

relevant reporting document--an entity or body that is

required to give the document under section 13 of the

Financial Sector (Collection of Data) Act 2001; or

(b) if the determination is to relate to all or a specified part of a

relevant reporting document of a specified kind--an

association or other body representing an entity or body, or a

class of entities or bodies, required to give a document of that

kind under section 13 of the Financial Sector (Collection of

Data) Act 2001.

registered entity means a corporation that is, or has at any time

been, a registered entity within the meaning of the Financial Sector

(Collection of Data) Act 2001.

Corporations Act 2001

5 Paragraph 601TAA(a)

Omit "published", substitute "made available to the public".

6 Paragraph 601TAA(b)

Omit "available", substitute "made available to the public".

7 Section 761A

Insert:

registrable superannuation entity has the same meaning as in the

Superannuation Industry (Supervision) Act 1993.

8 After section 1017B

Insert:

Collection and disclosure of information Schedule 3

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Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 27

1017BA Trustees of regulated superannuation funds--obligation to

make product dashboard publicly available

(1) The trustee, or the trustees, of a regulated superannuation fund that

has 5 or more members must ensure:

(a) that a product dashboard for each of the fund's MySuper

products and choice products is publicly available at all times

on the fund's website; and

(b) that each product dashboard sets out the information required

by subsection (2) or (3); and

the average amount of fees and other costs is updated within

14 days after the end of each quarter; and

(d) that the other information set out in each product dashboard

is updated within 14 days after any change to the

information; and

(e) if the regulations prescribe the way in which information is to

be set out in a product dashboard--that each product

dashboard sets out the information in accordance with the

regulations.

(2) The product dashboard for a MySuper product must set out the

following:

(a) the investment return target for the product;

(b) the number of times the current target has been achieved for

the product:

(i) in the last 10 financial years; or

(ii) if the MySuper product has been offered for a period of

less than 10 financial years--in each of the financial

years in which the MySuper product has been offered;

(d) a statement about the liquidity of members' investments in

the MySuper product;

(e) the average amount of fees and other costs in relation to the

MySuper product during the last quarter, expressed as a

percentage of the assets of the fund attributable to the

MySuper product.

Schedule 3 Collection and disclosure of information

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28 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(3) Subject to subsection (4), the product dashboard for a choice

product must set out the following for each investment option

offered within the choice product:

(a) the investment return target for the investment option;

(b) the number of times the current target has been achieved for

the investment option:

(i) in the last 10 financial years; or

(ii) if the investment option has been offered for a period of

less than 10 financial years--in each of the financial

years in which the investment option has been offered;

option;

(d) a statement about the liquidity of members' investments in

the investment option;

(e) the average amount of fees and other costs in relation to the

investment option during the last quarter, expressed as a

percentage of the assets of the fund attributable to the

investments in that option.

(4) Subsection (3) does not apply to an investment option within a

choice product if:

(a) the assets of the fund that are invested under the option are

invested only in one or more of the following:

(i) a life policy under which contributions and accumulated

earnings may not be reduced by negative investment

returns or any reduction in the value of assets in which

the policy is invested;

(ii) a life policy under which the benefit to a member (or a

relative or dependant of a member) is based only on the

realisation of a risk, not the performance of an

investment;

(iii) an investment account contract the only beneficiaries of

which are a member, and relatives and dependants of a

member; or

(b) the sole purpose of the investment option is the payment of a

pension to members who have satisfied a condition of release

of benefits specified in a standard made under paragraph

31(2)(h) of the Superannuation Industry (Supervision) Act

1993; or

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invested only in another single asset.

(5) In this section:

choice product has the same meaning as in the Superannuation

Industry (Supervision) Act 1993.

fee, in relation to a MySuper product or a choice product offered

by a regulated superannuation fund, means a fee (other than an

activity fee, an advice fee or an insurance fee within the meaning

of the Superannuation Industry (Supervision) Act 1993) that may

be charged by the trustee, or the trustees, of the regulated

superannuation fund in relation to the product under that Act.

investment account contract has the same meaning as in the Life

Insurance Act 1995.

life policy has the same meaning as in the Life Insurance Act 1995.

member, in relation to a regulated superannuation fund, has the

same meaning as in the Superannuation Industry (Supervision) Act

1993.

MySuper product has the same meaning as in the Superannuation

Industry (Supervision) Act 1993.

pension has the same meaning as in the Superannuation Industry

(Supervision) Act 1993.

quarter has the same meaning as in the Superannuation Industry

(Supervision) Act 1993.

regulated superannuation fund has the same meaning as in the

Superannuation Industry (Supervision) Act 1993.

1017BB Trustees of registrable superannuation entities--obligation

to make information relating to investment of assets

publicly available

(1) The trustee, or the trustees, of a registrable superannuation entity

(other than a pooled superannuation trust) must make the following

information publicly available on the entity's website no later than

90 days after each reporting day:

Schedule 3 Collection and disclosure of information

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30 Superannuation Legislation Amendment (Further MySuper and Transparency

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(a) information that is sufficient to identify each of the financial

products or other property in which assets, or assets derived

from assets, of the entity are invested, at the end of the

reporting day;

(b) the value of the assets, or assets derived from assets, of the

entity, at the end of the reporting day, that are invested in

each of the financial products or other property.

(2) Information made publicly available under subsection (1) in

respect of a reporting day must continue to be made publicly

available on the registrable superannuation entity's website until

information relating to the next reporting day is made publicly

available under subsection (1).

(3) If the regulations prescribe the way in which information made

publicly available under subsection (1) must be organised, the

information must be organised in accordance with the regulations.

(4) The regulations may provide that investment in a financial product

or other property is not a material investment in circumstances

prescribed by the regulations.

(5) If regulations are made for the purposes of subsection (4),

information relating to the investment of a financial product or

other property in the prescribed circumstances is not required to be

made publicly available under subsection (1).

(6) In this section:

reporting day means 30 June and 31 December each year.

1017BC Obligations relating to investment of assets of registrable

superannuation entities--general rule about giving notice

and providing information

(1) This section applies if:

(a) a person (the first party) enters into an arrangement with

another person (the second party); and

(b) under the terms of the arrangement, the first party acquires a

financial product from the second party; and

jurisdiction; and

Collection and disclosure of information Schedule 3

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Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 31

(d) the first party knows, or reasonably ought to know, that an

asset that is the subject of the arrangement is, or is derived

from, an asset of a registrable superannuation entity; and

(e) the arrangement is not of a kind prescribed by the regulations

as an arrangement to which this section does not apply.

Obligation of first party

(2) The first party must, at the time the arrangement is entered into,

notify the second party of the following:

(a) that an asset that is the subject of the arrangement is, or is

derived from, the assets of a registrable superannuation

entity;

(b) details of the trustee, or the trustees, of the registrable

superannuation entity.

Obligations of second party

(3) If the second party is notified by the first party in accordance with

subsection (2), the second party must provide the trustee, or the

trustees, of the registrable superannuation entity with information

about:

(a) the financial product acquired by the first party; and

(b) if the second party knows, or reasonably ought to know, that:

(i) an asset about which the second party was notified by

the first party will be used, by the second party or

another person, to acquire another financial product--

that financial product; or

(ii) an asset about which the second party was notified by

the first party will be used, by the second party or

another person, to acquire property other than a

financial product--that other property;

sufficient to allow the trustee, or the trustees, of the registrable

superannuation entity to satisfy the obligation under

section 1017BB.

Obligation of agent of first party

(4) If the financial product is acquired in this jurisdiction on behalf of

the first person by a person (the agent) other than a person who is

the provider or acquirer under a custodial arrangement:

Schedule 3 Collection and disclosure of information

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32 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(a) the agent must notify the second party in accordance with

subsection (2) on behalf of the first party; and

(b) if the agent so notifies the second party, the first party is

taken to have satisfied the obligation under that subsection.

Definitions

(5) In this section:

acquirer, in relation to a custodial arrangement, has the same

meaning as in subsection 1012IA(1).

custodial arrangement has the same meaning as in subsection

1012IA(1).

provider, in relation to a custodial arrangement, has the same

meaning as in subsection 1012IA(1).

1017BD Obligations relating to investment of assets of registrable

superannuation entities--giving notice to providers under

custodial arrangements

(1) This section applies if:

(a) a person (the first party) enters into an arrangement (the core

arrangement) with another person (the second party); and

(b) under the terms of the core arrangement, the second party is

the provider under a custodial arrangement under which the

first party is a client; and

the custodial arrangement, a financial product may be

acquired in this jurisdiction; and

(d) the first party knows, or reasonably ought to know, that an

asset that is the subject of the core arrangement is, or is

derived from, an asset of a registrable superannuation entity;

and

(e) the core arrangement is not of a kind prescribed by the

regulations as an arrangement to which this section does not

apply.

(2) The first party must, at the time the core arrangement is entered

into, notify the second party of the following:

Collection and disclosure of information Schedule 3

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Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 33

(a) that an asset that is the subject of the core arrangement is, or

is derived from, the assets of a registrable superannuation

entity;

(b) details of the trustee, or the trustees, of the registrable

superannuation entity.

Note:

Section 1017BC may apply in relation to an arrangement under which

the second party, or an acquirer under the custodial arrangement,

actually acquires the financial product.

(3) In this section:

acquirer, in relation to a custodial arrangement, has the same

meaning as in subsection 1012IA(1).

client, in relation to a custodial arrangement, has the same meaning

as in subsection 1012IA(1).

custodial arrangement has the same meaning as in subsection

1012IA(1).

provider, in relation to a custodial arrangement, has the same

meaning as in subsection 1012IA(1).

1017BE Obligations relating to investment of assets of registrable

superannuation entities--giving notice to acquirers under

custodial arrangements

(1) This section applies if:

(a) a person (the first party) enters into an arrangement (the core

arrangement) with another person (the second party); and

(b) under the terms of the core arrangement, the second party is

the acquirer in relation to a custodial arrangement under

which the first party is the provider; and

the core arrangement, the second party may acquire a

financial product in this jurisdiction; and

(d) the first party knows, or reasonably ought to know, that an

asset that is the subject of the core arrangement is, or is

derived from, an asset of a registrable superannuation entity;

and

Schedule 3 Collection and disclosure of information

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34 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(e) the core arrangement is not of a kind prescribed by the

regulations as an arrangement to which this section does not

apply.

(2) The first party must, at the time the core arrangement is entered

into, notify the second party of the following:

(a) that an asset that is the subject of the core arrangement is, or

is derived from, the assets of a registrable superannuation

entity;

(b) details of the trustee, or the trustees, of the registrable

superannuation entity.

Note:

Section 1017BC may apply in relation to an arrangement under which

the second party actually acquires the financial product.

(3) In this section:

acquirer, in relation to a custodial arrangement, has the same

meaning as in subsection 1012IA(1).

custodial arrangement has the same meaning as in subsection

1012IA(1).

provider, in relation to a custodial arrangement, has the same

meaning as in subsection 1012IA(1).

9 At the end of subsection 1020E(1)

Add:

; or (c) information made publicly available under section 1017BA

or 1017BB, or provided under subsection 1017BC(3), is

defective (see subsection (11)).

10 After paragraph 1020E(2)(b)

Insert:

; or (c) if paragraph (1)(c) applies--specified conduct in respect of

the financial products or other property to which the

information relates;

11 Paragraph 1020E(7)(a)

Omit "or (c)", substitute ", (c) or (d)".

12 At the end of subsection 1020E(7)

Collection and disclosure of information Schedule 3

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Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 35

Add:

; or (d) if paragraph (1)(c) applies--the person who made the

information publicly available or who provided the

information.

13 Subsection 1020E(11) (at the end of the definition of

defective)

Add:

; and (c) in relation to information made publicly available under

section 1017BA--means:

(i) the information has not been updated as required by that

section; or

(ii) the information is otherwise misleading or deceptive; or

(iii) there is an omission from the information; and

(d) in relation to information made publicly available under

section 1017BB or information provided under

section 1017BC--means:

(i) the information is misleading or deceptive; or

(ii) there is an omission from the information.

14 After section 1021N

Insert:

1021NA Offences relating to obligation to make product dashboard

publicly available

Failure to comply with obligation to make product dashboard

publicly available

(1) A person commits an offence if:

(a) the person is a trustee of a regulated superannuation fund;

and

(b) as trustee, the person is required, under section 1017BA, to

ensure that a product dashboard for each of the fund's

MySuper products and choice products is made publicly

available on the fund's website; and

and choice products is not made publicly available as

required by that section.

Schedule 3 Collection and disclosure of information

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36 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Offence where information known to be defective

(2) A person commits an offence if:

(a) the person is a trustee of a regulated superannuation fund;

and

(b) a product dashboard is made publicly available on the fund's

website in purported compliance with section 1017BA; and

(i) the information set out in the product dashboard has not

been updated as required by that section; or

(ii) the information set out in the product dashboard is

otherwise misleading or deceptive; or

(iii) there is an omission from the information set out in the

product dashboard.

Offence whether or not information known to be defective

(3) A person commits an offence if:

(a) the person is a trustee of a regulated superannuation fund;

and

(b) a product dashboard is made publicly available on the fund's

website in purported compliance with section 1017BA; and

(c)

either:

(i) the information set out in the product dashboard has not

been updated as required by that section; or

(ii) the information set out in the product dashboard is

otherwise misleading or deceptive; or

(iii) there is an omission from the information set out in the

product dashboard.

(4) For the purposes of an offence based on subsection (3), strict

liability applies to the physical element of the offence specified in

any of subparagraphs (3)(c)(i) to (iii).

Note:

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

Defences

(5) In any proceedings against a trustee of a regulated superannuation

fund for an offence based on subparagraph (2)(c)(iii) or (3)(c)(iii),

it is a defence if:

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(a) the trustee or another trustee of the fund took reasonable

steps to ensure that there would not be an omission from the

information set out in the product dashboard; or

(b) both of the following apply:

(i) the information was omitted because it was not up to

date;

(ii) the trustee or another trustee of the fund took reasonable

steps to obtain up-to-date information; or

(i) the information was omitted because it would have been

misleading or deceptive;

(ii) the trustee or another trustee of the fund took reasonable

steps to obtain information that would not have been

misleading or deceptive.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (5). See subsection 13.3(3) of the Criminal Code.

(6) In any proceedings against a trustee of a regulated superannuation

fund for an offence based on subparagraph (3)(c)(i), it is a defence

if the trustee or another trustee of the fund took reasonable steps to

ensure that the information set out in the product dashboard was

updated as required by section 1017BA.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (6). See subsection 13.3(3) of the Criminal Code.

(7) In any proceedings against a trustee of a regulated superannuation

fund for an offence based on subparagraph (3)(c)(ii), it is a defence

if the trustee or another trustee of the fund took reasonable steps to

ensure that the information set out in the product dashboard would

not be misleading or deceptive.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (7). See subsection 13.3(3) of the Criminal Code.

1021NB Offences relating to obligation to make superannuation

investment information publicly available

Failure to comply with obligation to make information publicly

available

(1) A person commits an offence if:

Schedule 3 Collection and disclosure of information

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38 Superannuation Legislation Amendment (Further MySuper and Transparency

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(a) the person is a trustee of a registrable superannuation entity;

and

(b) as trustee, the person is required, under section 1017BB, to

make information publicly available on the entity's website;

and

that section.

Offence where information known to be defective

(2) A person commits an offence if:

(a) the person is a trustee of a registrable superannuation entity;

and

(b) as trustee, the person is required, under section 1017BB, to

make information publicly available; and

compliance with that requirement; and

(d) the trustee knows that:

(i) the information is misleading or deceptive; or

(ii) there is an omission from the information.

Offence whether or not information known to be defective

(3) A person commits an offence if:

(a) the person is a trustee of a registrable superannuation entity;

and

(b) as trustee, the person is required, under section 1017BB, to

make information publicly available; and

compliance with that requirement; and

(d)

either:

(i) the information is misleading or deceptive; or

(ii) there is an omission from the information.

(4) For the purposes of an offence based on subsection (3), strict

liability applies to the physical element of the offence specified in

subparagraph (3)(d)(i) or (ii).

Note:

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

Collection and disclosure of information Schedule 3

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Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 39

Defences

(5) In any proceedings against a trustee of a registrable superannuation

entity for an offence based on subsection (1), it is a defence if the

information would have been made publicly available but for the

fact that the trustee or another trustee of the entity was unable to

obtain the information after taking reasonable steps to do so.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (5). See subsection 13.3(3) of the Criminal Code.

(6) In any proceedings against a trustee of a registrable superannuation

entity for an offence based on subparagraph (2)(d)(ii) or (3)(d)(ii),

it is a defence if:

(a) there was an omission from the information made publicly

available because the trustee or another trustee of the entity

was unable to obtain the information after taking reasonable

steps to do so; or

(b) both of the following apply:

(i) the information was omitted because it would have been

misleading or deceptive;

(ii) the trustee or another trustee of the entity took

reasonable steps to obtain information that would not

have been misleading or deceptive.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (6). See subsection 13.3(3) of the Criminal Code.

(7) In any proceedings against a trustee of a registrable superannuation

entity for an offence based on subparagraph (3)(d)(i), it is a

defence if the trustee or another trustee of the entity took

reasonable steps to ensure that the information made publicly

available would not be misleading or deceptive.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (7). See subsection 13.3(3) of the Criminal Code.

1021NC Offences relating to obligations under sections 1017BC,

1017BD and 1017BE

Failure to notify

(1) A person commits an offence if:

Schedule 3 Collection and disclosure of information

Part 1 Amendments

40 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(a) the person is required to notify another person under

subsection 1017BC(2) or (4) or section 1017BD or 1017BE;

and

(b) the person does not notify, and is not taken to have notified,

the other person as required by that provision.

Failure to provide information

(2) A person commits an offence if:

(a) the person is required to provide another person with

information under subsection 1017BC(3); and

(b) the person does not provide the other person with the

information as required by that subsection.

Information provided known to be defective

(3) A person commits an offence if:

(a)

the

person:

(i) notifies another person of information as required by

subsection 1017BC(2) or (4) or section 1017BD or

1017BE; or

(ii) provides information (whether in a document or

otherwise) to another person as required by subsection

1017BC(3); and

(b) the person knows that:

(i) the information provided is misleading or deceptive; or

(ii) there is an omission from the information provided.

Information provided defective

(4) A person commits an offence if:

(a)

the

person:

(i) notifies another person of information as required by

subsection 1017BC(2) or (4) or section 1017BD or

1017BE; or

(ii) provides information (whether in a document or

otherwise) to another person as required by subsection

1017BC(3); and

(b)

either:

(i) the information provided is misleading or deceptive; or

Collection and disclosure of information Schedule 3

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Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 41

(ii) there is an omission from the information provided.

(5) For the purposes of an offence based on subsection (4), strict

liability applies to the physical element of the offence specified in

subparagraph (4)(b)(i) or (ii).

Note:

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

Defences

(6) In any proceedings against a person for an offence based on

subparagraph (3)(b)(ii) or (4)(b)(ii), it is a defence if:

(a) the person took reasonable steps to ensure that there would

not be an omission from the information provided; or

(b) both of the following apply:

(i) the information was omitted because it would have been

misleading or deceptive;

(ii) the person took reasonable steps to obtain information

that would not have been misleading or deceptive.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (6). See subsection 13.3(3) of the Criminal Code.

(7) In any proceedings against a person for an offence based on

subparagraph (4)(b)(i), it is a defence if the person took reasonable

steps to ensure that the information provided would not be

misleading or deceptive.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (7). See subsection 13.3(3) of the Criminal Code.

15 After paragraph 1022B(1)(e)

Insert:

; or (f) a person is required by section 1017BA to make information

publicly available on a regulated superannuation fund's

website and any of the following circumstances apply:

(i) the information is not made publicly available as

required by that section;

(ii) the information made publicly available is not updated

as required by that section;

(iii) the information made publicly available is misleading or

deceptive;

Schedule 3 Collection and disclosure of information

Part 1 Amendments

42 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(iv) there is an omission from the information made publicly

available; or

(g) a person is required by section 1017BB to make information

publicly available on a registrable superannuation entity's

website and any of the following circumstances apply:

(i) the information is not made publicly available as

required by that section;

(ii) the information made publicly available is misleading or

deceptive;

(iii) there is an omission from the information made publicly

available; or

(h) a person is required by subsection 1017BC(3) to provide

information to another person and any of the following

circumstances apply:

(i) the person does not provide the information as required

by that subsection;

(ii) the information provided is misleading or deceptive;

(iii) there is an omission from the information provided.

16 After paragraph 1022B(2)(e)

Insert:

; or (f) if paragraph (1)(f), (g) or (h) apply--because of any of the

circumstances mentioned in those paragraphs;

17 Subsection 1022B(2)

Omit "or (e)", substitute ", (e) or (f)".

18 At the end of subsection 1022B(3)

Add:

; or (e) if paragraph (1)(f) applies--the trustee, or the trustees, of the

regulated superannuation fund on whose website the

information was required to be made publicly available; or

(f) if paragraph (1)(g) applies--the trustee, or the trustees, of the

registrable superannuation entity on whose website the

information was required to be made publicly available; or

(g) if paragraph (1)(h) applies--the person who was required to

provide the information.

19 After subsection 1022B(7A)

Collection and disclosure of information Schedule 3

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Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 43

Insert:

(7B) A person is not liable under subsection (2) in a situation described

in subparagraph (1)(f)(iii), (g)(ii) or (h)(ii) if the person took

reasonable steps to ensure that the information would not be

misleading or deceptive.

(7C) A person is not liable under subsection (2) in a situation described

in subparagraph (1)(f)(iv), (g)(iii) or (h)(iii) if the person took

reasonable steps to ensure that there would not be an omission

from the information.

20 At the end of paragraph 1041H(3)(a)

Add:

(iii) section 1021NA, 1021NB or 1021NC; or

21 At the end of paragraph 1041K(1)(a)

Add:

(iii) section 1021NA, 1021NB or 1021NC; or

22 At the end of Chapter 10

Add:

Part 10.22--Transitional provisions relating to the

Superannuation Legislation Amendment

(Further MySuper and Transparency

Measures) Act 2012

1539 Application of section 1017BA (Obligation to make product

dashboard publicly available)

Section 1017BA applies:

(a) to the extent that it relates to MySuper products--on and

after 1 July 2013; and

(b) to the extent that it relates to choice products--on and after

1 July 2014.

Schedule 3 Collection and disclosure of information

Part 1 Amendments

44 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

1540 Application of subsection 1017BB(1) (Obligation to make

information relating to investment of assets of

superannuation entities publicly available)

Subsection 1017BB(1) applies in relation to the reporting day that

is 31 December 2013 and to later reporting days.

1541 Application of section 1017BC (Obligation to provide

information relating to investment of assets of

superannuation entities)

(1) Section 1017BC applies in relation to arrangements entered into on

or after this Act receives the Royal Assent.

(2) In any proceedings against a trustee of a registrable superannuation

entity for an offence based on subsection 1021NB(1), it is a

defence if the information would have been made publicly

available but for the fact that the information was not provided to

the trustee because, under this section, section 1017BC did not

apply to a particular arrangement.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (2). See subsection 13.3(3) of the Criminal Code.

(3) In any proceedings against a trustee of a registrable superannuation

entity for an offence based on subparagraph 1021NB(2)(d)(ii) or

(3)(d)(ii), it is a defence if there would not have been an omission

from the information made publicly available but for the fact that

the information omitted was not provided to the trustee because,

under this section, section 1017BC did not apply to a particular

arrangement.

Note:

A defendant bears an evidential burden in relation to the matters in

subsection (3). See subsection 13.3(3) of the Criminal Code.

23 Schedule 3 (after table item 308A)

Insert:

308AA Subsection

1021NA(1) 100

penalty units or imprisonment for 2

years, or both.

308AB Subsection

1021NA(2) 200

penalty units or imprisonment for 5

years, or both.

308AC Subsection

1021NA(3) 100

penalty units or imprisonment for 2

Collection and disclosure of information Schedule 3

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 45

years, or both.

308AD Subsection

1021NB(1) 100

penalty units or imprisonment for 2

years, or both.

308AE Subsection

1021NB(2) 200

penalty units or imprisonment for 5

years, or both.

308AF Subsection

1021NB(3) 100

penalty units or imprisonment for 2

years, or both.

308AG Subsections

1021NC(1)

and (2)

100 penalty units or imprisonment for 2

years, or both.

308AH Subsection

1021NC(3) 200

penalty units or imprisonment for 5

years, or both.

308AI Subsection

1021NC(4) 100

penalty units or imprisonment for 2

years, or both.

Financial Sector (Collection of Data) Act 2001

24 Subsection 3(1)

Omit "in order to assist", substitute "for the purposes of".

25 Paragraph 3(1)(a)

Before "APRA", insert "assisting".

26 After paragraph 3(1)(a)

Insert:

(aa) enabling APRA to publish information given by financial

sector entities; and

27 Paragraph 3(1)(b)

Before "another", insert "assisting".

28 Paragraph 3(1)(c)

Before "the Minister", insert "assisting".

29 After subsection 13(4)

Insert:

Schedule 3 Collection and disclosure of information

Part 1 Amendments

46 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(4A) A reporting standard may require an RSE licensee to provide

information in relation to the investment of assets, or assets derived

from assets, of the RSE licensee's registrable superannuation

entities (the relevant assets) by the RSE licensee or a person

connected with the RSE licensee (the investor), including

information about the following:

(a) any deductions (whether to cover fees, taxes, costs or for any

other purpose) from the return on the investment made by the

investor before all or part of the remainder of the return is

paid or reinvested;

(b) if the investor has invested all or part of the relevant assets in

financial products or other property--the financial products

or other property in which the investor has invested the

relevant assets;

a managed investment scheme and the assets of the scheme

have been invested in whole or part in financial products or

other property--the financial products or other property in

which the assets of the scheme have been invested;

(d) if the investor has invested all or part of the relevant assets in

a pooled superannuation trust or other kind of trust and the

assets of the trust have been invested in whole or part in

financial products or other property--the financial products

or other property in which the assets of the trust have been

invested;

(e) the operations of the investor.

(4B)

If:

(a) a reporting standard requires an RSE licensee to provide

information (the required information) in relation to the

investment of relevant assets by the RSE licensee or a person

connected with the RSE licensee; and

(b) the relevant assets are invested under a contract or other

arrangement between:

(i) the RSE licensee, a related body corporate of the RSE

licensee or a custodian in relation to the relevant assets

and the RSE licensee or related body corporate (the first

party); and

(ii) a person connected with the RSE licensee (the second

party);

Collection and disclosure of information Schedule 3

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 47

the contract or arrangement is taken to include:

are invested or as soon as reasonably practicable after that

time, to notify the second party that the assets are, or are

derived from, a registrable superannuation entity; and

(d) a term requiring the second party, if notified by the first party

in accordance with paragraph (c), to, as soon as reasonably

practicable after being notified, provide the first party with

the required information of which the second party is aware.

(4C) A person is connected with an RSE licensee for the purposes of

subsections (4A) and (4B) if the person is:

(a) a related body corporate of the RSE licensee; or

(b) a custodian in relation to assets, or assets derived from assets,

of the RSE licensee's registrable superannuation entities, and

in relation to the RSE licensee or a related body corporate of

the RSE licensee; or

(i) the RSE licensee; or

(ii) a related body corporate of the RSE licensee; or

(iii) a custodian in relation to assets, or assets derived from

assets, of the RSE licensee's registrable superannuation

entities, and in relation to the RSE licensee or a related

body corporate of the RSE licensee;

invests assets, or assets derived from assets, of the RSE

licensee's registrable superannuation entities.

30 Subparagraph 13B(2)(a)(iii)

Omit "to".

31 Section 31

Insert:

arrangement has the same meaning as in Chapter 7 of the

Corporations Act 2001.

32 Section 31

Insert:

Schedule 3 Collection and disclosure of information

Part 1 Amendments

48 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

custodian has the same meaning as in the Superannuation Industry

(Supervision) Act 1993.

33 Section 31

Insert:

financial product has the same meaning as in Chapter 7 of the

Corporations Act 2001.

34 Section 31

Insert:

pooled superannuation trust has the same meaning as in the

Superannuation Industry (Supervision) Act 1993.

35 Section 31

Insert:

registrable superannuation entity has the same meaning as in the

Superannuation Industry (Supervision) Act 1993.

36 Section 31

Insert:

related, in relation to an RSE licensee that is a body corporate and

another body corporate, has the same meaning as in the

Superannuation Industry (Supervision) Act 1993.

37 Section 31

Insert:

RSE licensee has the same meaning as in the Superannuation

Industry (Supervision) Act 1993.

Superannuation Industry (Supervision) Act 1993

38 Subparagraph 6(1)(a)(i)

After "subsection 29SAA(3)", insert "and sections 29QB and 29QC".

39 Subparagraph 6(1)(c)(ia)

After "subsection 29SAA(3)", insert "and sections 29QB and 29QC".

Collection and disclosure of information Schedule 3

Amendments Part 1

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2012 No. , 2012 49

40 Subsection 10(1) (definition of choice product)

Repeal the definition, substitute:

choice product: A class of beneficial interest in a regulated

superannuation fund is a choice product unless:

(a) all the members of the fund who hold that class of beneficial

interest in the fund are defined benefit members; or

(b) that class of beneficial interest in the fund is a MySuper

product.

41 Subsection 10(1)

Insert:

quarter means a period of 3 months beginning on 1 January,

1 April, 1 July and 1 October.

42 At the end of Division 6 of Part 2B

Add:

29QB Certain information required to be made publicly available

(1) An RSE licensee of a registrable superannuation entity must ensure

that the following is made publicly available, and kept up to date,

at all times on the registrable superannuation entity's website:

(a) details of the remuneration of:

(i) if the RSE licensee is a body corporate--each executive

officer in relation to the RSE licensee; and

(ii) if the RSE licensee is a group of individual trustees--

each trustee of the registrable superannuation entity;

being details of a kind prescribed by the regulations;

(b) any other document or information prescribed by the

regulations.

(2) A person commits an offence if:

(a) the person is:

(i) a body corporate that is an RSE licensee; or

(ii) a member of a group of individual trustees that is an

RSE licensee; and

(b) the RSE licensee contravenes subsection (1).

Schedule 3 Collection and disclosure of information

Part 1 Amendments

50 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Penalty: 50 penalty units.

(3) Subsection (2) is an offence of strict liability.

Note 1:

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

Note 2:

Chapter 2 of the Criminal Code sets out the general principles of

criminal liability and Part IA of the Crimes Act 1914 contains

provisions dealing with penalties.

29QC Obligation to give consistent information

(1) Subject to subsection (2), if:

(a) an RSE licensee is required to give information to APRA

under a reporting standard (within the meaning of the

Financial Sector (Collection of Data) Act 2001); and

(b) under the reporting standard, the information is required to be

calculated in a particular way; and

licensee to a person other than an agency of the

Commonwealth or of a State or Territory, whether or not by

publishing the information on a website;

the RSE licensee must ensure that the information given to the

other person is calculated in the same way as the information given

to APRA.

(2) Subsection (1) does not apply to information given to the other

person in circumstances prescribed by the regulations.

(3) A person commits an offence if:

(a) the person is:

(i) a body corporate that is an RSE licensee; or

(ii) a member of a group of individual trustees that is an

RSE licensee; and

(b) the RSE licensee contravenes subsection (1).

Penalty: 50 penalty units.

(4) Subsection (3) is an offence of strict liability.

Note 1:

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

Note 2:

Chapter 2 of the Criminal Code sets out the general principles of

criminal liability and Part IA of the Crimes Act 1914 contains

provisions dealing with penalties.

Collection and disclosure of information Schedule 3

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 51

43 Section 38A (at the end of the definition of regulatory

provision)

Add:

; or (c) any of the following provisions of the Corporations Act

2001:

(i) subsection 1021NA(1), (2) or (3);

(ii) subsection 1021NB(1), (2) or (3);

(iii) subsection 1021NC(1), (2), (3) or (4).

44 After section 348

Insert:

348A Quarterly reports about superannuation

(1) As soon as practicable after the end of each quarter, the Regulator

must publish the following information on its website in respect of

the quarter:

(a) the fees charged in relation to MySuper products, on a

product by product basis;

(b) the costs incurred in relation to MySuper products, on a

product by product basis;

funds who hold MySuper products, on a product by product

basis;

(d) any other information prescribed by the regulations.

(2) The Regulator must not publish the information in a manner that

enables the identification of a beneficiary of a regulated

superannuation fund.

(3) Subsection (1) does not apply to the extent that its operation would

result in an acquisition of property (within the meaning of

paragraph 51(xxxi) of the Constitution) from a person otherwise

than on just terms (within the meaning of that paragraph of the

Constitution).

(4) In this section:

Regulator means APRA.

Schedule 3 Collection and disclosure of information

Part 2 Application and transitional provisions

52 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Part 2--Application and transitional provisions

45 Savings provision--section 57 determinations

(1)

A determination that:

(a) is made under section 57 of the old law; and

(b) is in force immediately before this item commences;

has effect on and after this item commences as if it had been made

under section 57 of the new law.

(2)

If, before this item commences:

(a) APRA has, for the purposes of paragraph 57(a) of the old

law, given an entity, association or other body the

opportunity to make representations in respect of information

of the kind contained in a document; and

(b) APRA has not made a determination under section 57 of the

old law in respect of the document;

any representations made by the entity, association or other body in

respect of information of the kind contained in the document, whether

the representations are made before, on or after this item commences,

are taken to have been made for the purposes of subsection 57(3) of the

new law.

(3)

In this item:

new law means the Australian Prudential Regulation Authority Act

1998 as amended by this Schedule.

old law means the Australian Prudential Regulation Authority Act 1998

as in force immediately before this item commences.

46 Application--reporting standards

(1)

Subsection 13(4B) of the Financial Sector (Collection of Data) Act

2001, as inserted by this Schedule, applies in relation to a contract or

arrangement whether entered into before, on or after this item

commences.

(2)

Despite subitem (1), that subsection does not apply in relation to a

contract or arrangement that is entered into before this item commences,

to the extent that the operation of a reporting standard mentioned in that

subsection would result in an acquisition of property (within the

meaning of paragraph 51(xxxi) of the Constitution) from a person

Collection and disclosure of information Schedule 3

Application and transitional provisions Part 2

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 53

otherwise than on just terms (within the meaning of that paragraph of

the Constitution).

(3)

If, because of subitem (2), an RSE licensee is unable to obtain particular

information that a reporting standard (within the meaning of the

Financial Sector (Collection of Data) Act 2001) requires an RSE

licensee to provide in relation to the investment of assets, or assets

derived from assets, of the RSE licensee's registrable superannuation

entities by a person connected with the RSE licensee, then the RSE

licensee is not required to comply with the reporting standard to the

extent that it requires the RSE licensee to provide that particular

information.

47 Application--quarterly reports about superannuation

Section 348A of the Superannuation Industry (Supervision) Act 1993,

as inserted by this Schedule, applies in relation to the quarter beginning

on 1 July 2013 and all later quarters.

Schedule 4 Modern awards and enterprise agreements

Part 1 Amendments

54 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Schedule 4--Modern awards and enterprise

agreements

Part 1--Amendments

Fair Work Act 2009

1 Section 12

Insert:

default fund employee: see subsection 149A(2).

2 Section 12

Insert:

defined benefit member has the meaning given by the

Superannuation Guarantee (Administration) Act 1992.

3 Section 12

Insert:

exempt public sector superannuation scheme has the meaning

given by the Superannuation Industry (Supervision) Act 1993.

4 Section 12

Insert:

MySuper product has the meaning given by the Superannuation

Industry (Supervision) Act 1993.

5 At the end of Subdivision C of Division 3 of Part 2-3

Add:

149A Superannuation contributions for defined benefit members

(1) A modern award must include a term that permits an employer

covered by the award to make contributions to a superannuation

fund or scheme in relation to a default fund employee who is:

(a) covered by the award; and

Modern awards and enterprise agreements Schedule 4

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 55

(b) a defined benefit member of the fund or scheme.

Note:

An employer may make contributions under this term even if the

superannuation fund or scheme to which the contributions are made is

not specified in the modern award because of section 155A.

(2) An employee is a default fund employee if the employee has no

chosen fund within the meaning of the Superannuation Guarantee

(Administration) Act 1992.

6 At the end of Division 3 of Part 2-3

Add:

155A Terms dealing with superannuation

(1) A modern award must not include a term that has the effect of

requiring or permitting contributions, for the benefit of an

employee covered by the award who is a default fund employee, to

be made to a superannuation fund or scheme specified in the

modern award, unless one of the following is satisfied in relation to

the fund or scheme:

(a) it is a fund that offers a MySuper product;

(b) it is an exempt public sector superannuation scheme.

Note:

Contributions may be made to a superannuation fund or scheme for its

defined benefit members under section 149A even though the fund or

scheme is not specified in a modern award because of this section.

(2) Subsection (3) applies if the Australian Prudential Regulation

Authority (APRA) gives FWA notice under subsection 29U(4) of

the Superannuation Industry (Supervision) Act 1993 that a

regulated superannuation fund no longer offers any MySuper

product.

(3)

FWA

must:

(a) ensure that the text of a modern award as published by FWA

does not include a term that has the effect of requiring or

permitting contributions, for the benefit of an employee

covered by the award who is a default fund employee, to be

made to the fund; and

(b) do so as soon as is reasonably practicable after receiving the

notice.

Schedule 4 Modern awards and enterprise agreements

Part 1 Amendments

56 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(4) Subsection (5) applies if APRA gives FWA notice under

section 29XC of the Superannuation Industry (Supervision) Act

1993 that a scheme has ceased to be an exempt public sector

superannuation scheme and does not offer a MySuper product.

(5)

FWA

must:

(a) ensure that the text of a modern award as published by FWA

does not include a term that has the effect of requiring or

permitting contributions, for the benefit of an employee

covered by the award who is a default fund employee, to be

made to the scheme; and

(b) do so as soon as is reasonably practicable after receiving the

notice.

7 At the end of section 194

Add:

; or (h) a term that has the effect of requiring or permitting

contributions, for the benefit of an employee (the relevant

employee) covered by the agreement who is a default fund

employee, to be made to a superannuation fund or scheme

that is specified in the agreement but does not satisfy one of

the following:

(i) it is a fund that offers a MySuper product;

(ii) it is a fund or scheme of which the relevant employee,

and each other default fund employee in relation to

whom contributions are made to the fund or scheme by

the same employer as the relevant employee, is a

defined benefit member;

(iii) it is an exempt public sector superannuation scheme.

8 At the end of Schedule 1 to the Act

Add:

Modern awards and enterprise agreements Schedule 4

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 57

Part 2--Amendments made by the Superannuation

Legislation Amendment (Further MySuper

and Transparency Measures) Act 2012

8 Definitions

In this Part:

amended Act means this Act as amended by the Superannuation

Legislation Amendment (Further MySuper and Transparency

Measures) Act 2012.

9 Application of sections 149A and 155A of amended Act

Sections 149A and 155A of the amended Act apply in relation to a

modern award that is in operation on or after 1 January 2014,

whether or not the award was made before that day.

10 FWA to vary certain modern awards

(1) This clause applies in relation to a modern award if the award:

(a) is made before 1 January 2014; and

(b) is in operation on that day; and

relevant term) of the kind mentioned in section 149A of the

amended Act.

(2) FWA must, by 31 December 2013, make a determination varying

the modern award to include the relevant term.

(3) A determination made under subclause (2) comes into operation on

(and takes effect from) 1 January 2014.

(4) Section 168 applies to a determination made under subclause (2) as

if it were a determination made under Part 2-3.

11 FWA to update text of certain modern awards

(1) This clause applies in relation to a modern award if the award:

(a) is made before 1 January 2014; and

Schedule 4 Modern awards and enterprise agreements

Part 1 Amendments

58 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(b) is in operation on that day; and

term) of the kind mentioned in section 155A of the amended

Act that specifies a fund or scheme (a non-complying fund

or scheme) that does not satisfy paragraph (1)(a) or (b) of

that section.

(2) FWA must ensure that the text of the modern award as published

by FWA does not include a non-complying fund or scheme in the

relevant term.

(3) FWA must do so by 1 January 2014 (despite section 155A of the

amended Act).

12 Application of paragraph 194(h) of amended Act

Paragraph 194(h) of the amended Act applies in relation to an

enterprise agreement that is approved by FWA on or after

1 January 2014.

Superannuation Guarantee (Administration) Act 1992

9 At the end of subsection 12A(1)

Add:

;

(j)

State reference transitional award or common rule.

10 At the end of subsection 32C(6)

Add:

; or (i) an award mentioned in paragraph 2(2)(a) of Schedule 3 to the

Fair Work (Transitional Provisions and Consequential

Amendments) Act 2009; or

(j) a State reference transitional award or common rule.

Superannuation Industry (Supervision) Act 1993

11 At the end of section 29U

Add:

(4)

If:

Modern awards and enterprise agreements Schedule 4

Amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 59

(a) APRA cancels an authority to offer a class of beneficial

interest in a regulated superannuation fund as a MySuper

product; and

(b) as a result of the cancellation, the fund no longer offers any

MySuper product;

APRA must also notify Fair Work Australia in writing of that fact.

12 At the end of Division 8 of Part 2C

Add:

29XC Public sector superannuation scheme ceases to be exempt

If APRA becomes aware that:

(a) a public sector superannuation scheme has ceased to be an

exempt public sector superannuation scheme; and

(b) the scheme is not a regulated superannuation fund that offers

a MySuper product;

APRA must notify Fair Work Australia of that fact.

Schedule 4 Modern awards and enterprise agreements

Part 2 Transitional

60 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Part 2--Transitional

13 Section 29WA of SIS Act not apply to contributions made

under certain enterprise agreements

(1)

This item applies if:

(a) an enterprise agreement is approved by FWA before

1 January 2014; and

(b) at the time the agreement is approved by FWA, the

agreement includes a term that has the effect of requiring or

permitting contributions, for the benefit of an employee (the

relevant employee) covered by the agreement who is a

default fund employee, to be made to a superannuation fund

or scheme that is specified in the agreement but does not

satisfy one of the following:

(i) it is a fund that offers a MySuper product;

(ii) it is a fund or scheme of which the relevant employee,

and each other default fund employee in relation to

whom contributions are made to the fund or scheme by

the same employer as the relevant employee, is a

defined benefit member;

(iii) it is an exempt public sector superannuation scheme;

and

relevant contributions) are made to the fund or scheme

under, or in accordance with, the agreement.

(2)

Section 29WA of the SIS Act does not apply to the relevant

contributions.

(3)

In this item:

default fund employee has the same meaning as in the Fair Work Act

2009.

defined benefit member has the same meaning as in the Superannuation

Guarantee (Administration) Act 1992.

enterprise agreement has the same meaning as in the Fair Work Act

2009.

exempt public sector superannuation scheme has the same meaning as

in the SIS Act.

FWA has the same meaning as in the Fair Work Act 2009.

Schedule 5 Defined benefit members

62 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

Schedule 5--Defined benefit members

Superannuation Guarantee (Administration) Act 1992

1 Section 6 (definition of defined benefit member)

After "defined benefit member", insert ", subject to section 6AA,".

2 After section 6

Insert:

6AA Interpretation: defined benefit member

The regulations may prescribe:

(a) circumstances in which a member of a superannuation fund is

not a defined benefit member for the purposes of this Act, or

a provision of this Act; and

(b) circumstances in which a member of a superannuation fund

who is not otherwise a defined benefit member is to be taken

to be a defined benefit member for the purposes of this Act,

or a provision of this Act.

3 After subsection 19(2C)

Insert:

(2CA) For the purposes of paragraph (2B)(b), if the employee is a defined

benefit member of a superannuation fund, subsection 32C(2)

applies in relation to the employee and the fund as if it did not

include paragraph 32C(2)(c) (requirement that fund includes a

MySuper product).

Superannuation Industry (Supervision) Act 1993

4 Subsection 10(1) (definition of defined benefit member)

Repeal the definition, substitute:

defined benefit member:

(a) in the definition of choice product in this subsection,

section 20B and Part 2C--has the same meaning as in the

Superannuation Guarantee (Administration) Act 1992; and

Defined benefit members Schedule 5

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 63

(b) in Division 3A of Part 8 and in Part 23--has the meaning

given by section 83A; and

the regulations;

subject to subsection (1A).

5 Savings

Despite the repeal of the definition of defined benefit member in

subsection 10(1) of the Superannuation Industry (Supervision) Act 1993

by item 4 of this Schedule, regulations in force for the purposes of that

definition immediately before the commencement of that item continue

in effect on and after that commencement, and may be repealed, as if

they were made for the purposes of paragraph (c) of the definition of

defined benefit member inserted by that item.

6 After subsection 10(1)

Insert:

(1A) The regulations may prescribe:

(a) circumstances in which a member of a superannuation fund is

not a defined benefit member for the purposes of this Act, or

a provision of this Act; and

(b) circumstances in which a member of a superannuation fund

who is not otherwise a defined benefit member for the

purposes of this Act, or a provision of this Act, is to be taken

to be a defined benefit member for the purposes of this Act,

or that provision.

7 Subparagraph 29TB(1)(d)(i)

After "any employee of the large employer", insert "who is not a

defined benefit member of the fund".

8 Subparagraph 29TB(1)(d)(ii)

After "any employee of that associate", insert "who is not a defined

benefit member of the fund".

9 At the end of section 29TB

Add:

Moving accrued default amounts Schedule 6

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 65

Schedule 6--Moving accrued default amounts

Superannuation Industry (Supervision) Act 1993

1 At the end of subparagraph 6(1)(a)(i)

Add "(other than subsection 29SAA(3))".

2 Before subparagraph 6(1)(c)(i)

Insert:

(ia)

subsection

29SAA(3);

and

3 Subsection 10(1)

Insert:

accrued default amount, for a member of a regulated

superannuation fund, has the meaning given by section 20B.

4 At the end of Division 2 of Part 1

Add:

20B Accrued default amounts

(1) Subject to this section, an amount is an accrued default amount

for a member of a regulated superannuation fund if:

(a) the amount is attributed by the trustee or the trustees of the

fund to the member of the fund; and

(b)

either:

(i) the member has not given the trustee, or the trustees, of

the fund a direction on the investment option under

which an asset (or assets) of the fund, or that part of an

asset (or assets) of the fund, attributed to the member in

relation to the amount (the member's underlying

asset(s)) is to be invested; or

(ii) the investment option under which the member's

underlying asset(s) is invested is one which, under the

governing rules of the fund at the time the member's

underlying asset(s) was invested, would have been the

investment option for the member's underlying asset(s)

if no direction had been given.

Schedule 6 Moving accrued default amounts

66 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(2) Such an amount is not an accrued default amount to the extent

that the amount is attributed to the member in relation to a

MySuper product.

(3) Such an amount is not an accrued default amount:

(a) if the member is a defined benefit member of the fund; or

(b) if the fund is an eligible rollover fund; or

more of the following:

(i) a life policy under which contributions and accumulated

earnings may not be reduced by negative investment

returns or any reduction in the value of assets in which

the policy is invested;

(ii) a life policy under which the benefit to the member (or a

relative or dependant of the member) is based only on

the realisation of a risk, not the performance of an

investment;

(iii) an investment account contract the only beneficiaries of

which are the member, and relatives and dependants of

the member; or

(d) to the extent that a pension is payable out of the member's

underlying asset(s), because the member has satisfied a

condition of release of benefits specified in a standard made

under paragraph 31(2)(h).

(4) In this section:

investment account contract has the same meaning as in the Life

Insurance Act 1995.

life policy has the same meaning as in the Life Insurance Act 1995.

5 After subsection 29E(6A)

Insert:

RSE licensees who apply for authority to offer MySuper product

(6B) An additional condition is imposed on each RSE licensee who

makes an application under section 29S for authority to offer a

class of beneficial interest in a regulated superannuation fund as a

MySuper product. The condition is that the RSE licensee must give

Moving accrued default amounts Schedule 6

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 67

effect to elections made in accordance with sections 29SAA,

29SAB and 29SAC.

6 At the end of subsection 29S(2)

Add:

; and (f) be accompanied by elections made in accordance with each

of the following sections:

(i)

section

29SAA;

(ii)

section

29SAB.

7 After section 29S

Insert:

29SAA Election to transfer accrued default amounts

(1) An RSE licensee that applies for authority to offer a class of

beneficial interest in a regulated superannuation fund as a MySuper

product makes an election in accordance with this section if:

(a) the RSE licensee elects that, if authority to offer the class of

beneficial interest in the fund as a MySuper product is given,

the RSE licensee will:

(i) attribute to the MySuper product each amount that is an

accrued default amount for a member of the fund who is

eligible to hold the MySuper product, unless the

member directs the RSE licensee in writing to attribute

the amount to another MySuper product or an

investment option within a choice product in the fund;

and

(ii) do so before the end of a period of 30 days beginning on

the day on which notice of authority to offer the class of

beneficial interest in the fund as a MySuper product is

given to the RSE licensee under section 29TD; and

(b) the RSE licensee elects that the RSE licensee will, before the

end of the action period, take the action required under the

prudential standards in relation to the following:

(i) each amount that is an accrued default amount for a

member of the fund who is not eligible to hold a

MySuper product offered by the fund;

(ii) each amount that is an accrued default amount for a

member of another regulated superannuation fund of the

Schedule 6 Moving accrued default amounts

68 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

RSE licensee that does not offer a MySuper product;

and

(d) the election is in the approved form.

(2)

The

action period, for the purposes of paragraph (1)(b), in relation

to an application by an RSE licensee for authority to offer a class

of beneficial interest in a regulated superannuation fund as a

MySuper product, ends at the end of a period of 90 days beginning

on:

(a) if APRA authorises the RSE licensee to offer the class of

beneficial interest in the fund as a MySuper product--the day

on which notice of that authority is given to the RSE licensee

under section 29TD; or

(b) if APRA refuses the application--the day on which notice of

the refusal is given to the RSE licensee under section 29TE.

(3) If an RSE licensee makes an election under this section, the RSE

licensee must comply with any requirements prescribed in the

regulations in relation to:

(a) notices to be given to a member of the fund for whom there is

an accrued default amount before the amount is attributed, or

a decision is taken to continue to attribute the amount, to a

MySuper product or an investment option within a choice

product in the fund; and

(b) notices to be given to a member of the fund for whom there is

an accrued default amount before the amount is moved to

another fund.

29SAB Election to transfer assets attributed to a MySuper product

if authorisation cancelled

An RSE licensee that applies for authority to offer a class of

beneficial interest in a regulated superannuation fund as a MySuper

product makes an election in accordance with this section if:

(a) the RSE licensee elects:

(i) to take the action required under the prudential

standards in relation to any asset or assets of the fund

that are attributed to the MySuper product, if the

authority to offer the relevant class of beneficial interest

Moving accrued default amounts Schedule 6

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 69

in the fund as a MySuper product is cancelled under

subsection 29U(1); and

(ii) to do so before the end of a period of 90 days beginning

on the day on which notice of the cancellation is given

to the RSE licensee under subsection 29U(3); and

(b) the election is in writing; and

8 At the end of subsection 29U(2)

; or (j) APRA is satisfied that the RSE licensee has failed to give

effect to an election made in accordance with section 29SAA

(election to transfer accrued default amounts to a MySuper

product).

9 At the end of Part 2C

Add:

Division 8--Other matters

29X Prudential standards dealing with accrued default amounts

A prudential standard determined under section 34C may include

provisions:

(a) requiring an RSE licensee of a regulated superannuation fund

who holds an accrued default amount:

(i) for a member of the fund who is not eligible to hold a

MySuper product offered by the fund; or

(ii) for a member of a regulated superannuation fund of the

RSE licensee that does not offer a MySuper product;

to transfer that amount to another regulated superannuation

fund that includes a MySuper product; and

(b) setting out the requirements that must be met in relation to

the transfer of such an accrued default amount; and

amount.

Schedule 6 Moving accrued default amounts

70 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

29XA Prudential standards dealing with assets attributed to former

MySuper products

A prudential standard determined under section 34C may include

provisions:

(a) requiring an RSE licensee who is authorised to offer a class

of beneficial interest in a regulated superannuation fund as a

MySuper product to transfer any asset or assets of the fund

that are attributed to the MySuper product into another

MySuper product within the fund, or a MySuper product

within another fund, if the authority is cancelled under

subsection 29U(1); and

(b) setting out the requirements that must be met in relation to

the transfer of such an asset or assets; and

29XB No liability for giving effect to a section 29SAA or 29SAB

election

A trustee of a regulated superannuation fund is not subject to any

liability to a member of the fund for an action taken to give effect

to an election made in accordance with section 29SAA or 29SAB.

10 After section 55A

Insert:

55B Governing rules do not prevent giving effect to certain elections

A provision in the governing rules of a regulated superannuation

fund is void to the extent that it would prevent a trustee or trustees

of the fund from giving effect to:

(a) an election made in accordance with section 29SAA (election

to transfer accrued default amounts to a MySuper product);

(b) an election made in accordance with section 29SAB (election

to transfer assets attributed to a MySuper product if

authorisation cancelled); or

subsection 29SAA(3).

11 After paragraph 58(2)(d)

Moving accrued default amounts Schedule 6

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 71

Insert:

(da) a direction given by a member of a regulated superannuation

fund to attribute (or continue to attribute) an amount that is

an accrued default amount for the member to a MySuper

product or an investment option within a choice product in

the fund; or

12 At the end of section 193

Add:

; (l) section 388.

13 At the end of the Act

Add:

Part 33--Additional transitional provisions relating

to MySuper

Division 1--Moving accrued default amounts to MySuper

products

386 Object

The object of this Division is to ensure that each accrued default

amount held by an RSE licensee before 1 July 2017 is moved into

a MySuper product.

387 Election to transfer accrued default amounts

(1) An RSE licensee of a regulated superannuation fund that makes an

application before 1 July 2017 for authority to offer a class of

beneficial interest in the fund as a MySuper product is taken to

make an election in accordance with section 29SAA if:

(a) the RSE licensee elects that, if authority to offer the class of

beneficial interest in the fund as a MySuper product is given,

the RSE licensee will:

(i) attribute to the MySuper product each amount that is an

accrued default amount for a member of the fund who is

eligible to hold the MySuper product, unless the

member directs the RSE licensee in writing to attribute

Schedule 6 Moving accrued default amounts

72 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

the amount to another MySuper product or an

investment option within a choice product in the fund;

and

(ii) do so before 1 July 2017, or the end of a period of 30

days beginning on the day on which notice of authority

to offer the relevant class of beneficial interest in the

fund as a MySuper product is given to the RSE licensee

under section 29TD (whichever is later); and

(b) the RSE licensee elects to take the action required under the

prudential standards in relation to the following, and to do so

before the transitional action period ends:

(i) each amount that is an accrued default amount for a

member of the fund who is not eligible to hold a

MySuper product offered by the fund;

(ii) each amount that is an accrued default amount for a

member of another regulated superannuation fund of the

RSE licensee that does not offer a MySuper product;

and

29SAA(1)(c) and (d).

(2)

The

transitional action period, for the purposes of

paragraph (1)(b), in relation to an application by an RSE licensee

for authority to offer a class of beneficial interest in a regulated

superannuation fund as a MySuper product, ends on the later of:

(a) 1 July 2017; and

(b) the end of a period of 90 days beginning on:

(i) if APRA authorises the RSE licensee to offer the class

of beneficial interest in the fund as a MySuper

product--the day on which notice of that authority is

given to the RSE licensee under section 29TD; or

(ii) if APRA refuses the application--the day on which

notice of the refusal is given to the RSE licensee under

section 29TE.

388 Transfer to MySuper products

(1)

If:

Moving accrued default amounts Schedule 6

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 73

(a) an RSE licensee of a regulated superannuation fund holds an

accrued default amount for a member of the fund

immediately before 1 July 2017; and

(b) no application is made before 1 July 2017 by the RSE

licensee, in relation to any of the RSE licensee's regulated

superannuation funds, for authority to offer a class of

beneficial interest in the fund as a MySuper product;

the RSE licensee must take the action required under the prudential

standards in relation to the amount before 1 July 2017.

(2) A trustee of a regulated superannuation fund is not subject to any

liability to a member of the fund for an action taken in accordance

with subsection (1).

(3) Subsection (1) does not apply to the extent that its operation would

result in an acquisition of property (within the meaning of

paragraph 51(xxxi) of the Constitution) from a person otherwise

than on just terms (within the meaning of that paragraph).

Division 2--Miscellaneous

389 Prudential standards dealing with transitional matters

A prudential standard determined under section 34C may include

provisions dealing with matters of a transitional nature relating to:

(a)

the

Superannuation Legislation Amendment (MySuper Core

Provisions) Act 2012; and

(b)

the

Superannuation Legislation Amendment (Trustee

Obligations and Prudential Standards) Act 2012; and

(c)

the

Superannuation Legislation Amendment (Further

MySuper and Transparency Measures) Act 2012.

390 Regulations dealing with transitional, savings and application

matters

The Governor-General may make regulations dealing with matters

of a transitional, saving, or application nature relating to the

amendments made by:

(a)

the

Superannuation Legislation Amendment (MySuper Core

Provisions) Act 2012; and

Eligible rollover funds Schedule 7

Main amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 75

Schedule 7--Eligible rollover funds

Part 1--Main amendments

Superannuation Industry (Supervision) Act 1993

1 Subsection 10(1)

Insert:

eligible rollover fund: a regulated superannuation fund is an

eligible rollover fund if an RSE licensee is authorised under

section 242F to operate the fund as an eligible rollover fund.

2 Subsection 10(1) (definition of enhanced director

obligations)

Repeal the definition, substitute:

enhanced director obligations means:

(a) for MySuper products--the obligations imposed by:

(i) section 29VO; and

(ii) covenants prescribed under section 54A that are

specified in the regulations as forming part of the

enhanced director obligations for MySuper products;

and

(b) for eligible rollover funds--the obligations imposed by:

(i) section 242L; and

(ii) covenants prescribed under section 54A that are

specified in the regulations as forming part of the

enhanced director obligations for eligible rollover funds.

3 Subsection 10(1) (definition of enhanced trustee

obligations)

Repeal the definition, substitute:

enhanced trustee obligations means:

(a) for MySuper products--the obligations imposed by:

(i) covenants referred to in section 52, as enhanced by the

obligations imposed under section 29VN; and

Schedule 7 Eligible rollover funds

Part 1 Main amendments

76 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

(ii) covenants prescribed under section 54A that are

specified in the regulations as forming part of the

enhanced trustee obligations for MySuper products; and

(b) for eligible rollover funds--the obligations imposed by:

(i) covenants referred to in section 52, as enhanced by the

obligations imposed under section 242K; and

(ii) covenants prescribed under section 54A that are

specified in the regulations as forming part of the

enhanced trustee obligations for eligible rollover funds.

4 Subsection 10(1) (after paragraph (u) of the definition of

reviewable decision)

Insert:

(ua) a decision of APRA under subsection 242F(2) to refuse to

authorise an RSE licensee to operate a regulated

superannuation fund as an eligible rollover fund; or

(ub) a decision of APRA under subsection 242J(1) to cancel an

authority to operate a regulated superannuation fund as an

eligible rollover fund; or

5 After subsection 29E(6B)

Insert:

RSE licensees who apply for authority to operate eligible rollover

funds

(6C) An additional condition is imposed on each RSE licensee who

makes an application under section 242A for authority to operate a

regulated superannuation fund as an eligible rollover fund. The

condition is that the RSE licensee must give effect to an election

made in accordance with section 242B.

RSE licensees authorised to operate eligible rollover funds

(6D) An additional condition is imposed on each RSE licensee that is

authorised to operate a regulated superannuation fund as an eligible

rollover fund. The condition is that the RSE licensee must ensure

that the governing rules of the fund are not varied so that:

(a) the only purpose of the fund is no longer to be a temporary

repository for amounts transferred to the fund from other

Eligible rollover funds Schedule 7

Main amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 77

regulated superannuation funds in circumstances allowed by

the RSE licensee law; or

(b) a single diversified investment strategy is no longer adopted

in relation to assets of the fund.

6 Paragraph 29T(1)(e)

Omit "(within the meaning of Part 24)".

7 At the end of subsection 54A(4)

Add ", for MySuper products or eligible rollover funds".

8 At the end of section 55B

Add:

; or (e) an election made in accordance with section 242B (election

to transfer amounts held in an eligible rollover fund if

authorisation cancelled); or

(f) an election made in accordance with section 242C (election

not to pass costs of paying conflicted remuneration to

members of eligible rollover fund).

9 Paragraph 193(l)

Repeal the paragraph, substitute:

(l)

subsection

242M(1);

(m)

section

388;

(n)

section

394.

10 Part 24 (heading)

Repeal the heading, substitute:

Part 24--Eligible rollover funds

11 Before section 241

Insert:

Division 1--Preliminary

12 Section 241

Repeal the section, substitute:

Schedule 7 Eligible rollover funds

Part 1 Main amendments

78 Superannuation Legislation Amendment (Further MySuper and Transparency

Measures) Bill 2012 No. , 2012

241 Object of this Part

The object of this Part is:

(a) to provide for the authorisation of RSE licensees to operate

eligible rollover funds; and

(b) to impose additional obligations on trustees, and directors of

corporate trustees, in relation to eligible rollover funds; and

rollover funds.

13 Section 242 (definition of eligible rollover fund)

Repeal the definition.

14 Section 242 (definition of fund)

Omit "or an approved deposit fund".

15 After section 242

Insert:

Division 2--Authority to operate an eligible rollover fund

Subdivision A--Applying for authority

242A Application for authority to operate an eligible rollover fund

Who may apply?

(1) An RSE licensee of a prescribed class may apply to APRA for

authority to operate a regulated superannuation fund as an eligible

rollover fund.

Requirements for applications

(2) An application for authority to operate a regulated superannuation

fund as an eligible rollover fund must:

(a) be in the approved form; and

(b) contain the information required by the approved form; and

(d) be accompanied by an election made in accordance with each

of the following sections:

Eligible rollover funds Schedule 7

Main amendments Part 1

Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill

2012 No. , 2012 79

(i)

section

242B;

(ii)

section

242C.

(3)

If:

(a) an RSE licensee applies for authority to operate a regulated

superannuation fund as an eligible rollover fund; and

(b) after the application is made, but before APRA decides the

application, information contained in the application ceases

to be correct;

the RSE licensee must give APRA the correct information, in

writing, as soon as practicable after the information in the

application ceases to be correct.

(4) An application is taken not to comply with this section if

subsection (3) is contravened.

Note:

APRA cannot give authority to operate a regulated superannuation

fund as an eligible rollover fund while the application does not comply

with this section: see paragraph 242F(1)(a).

Lapsed applications

(5) An application for authority lapses if:

(a) it was made by an RSE licensee; and

(b) the RSE licensee ceases to be an RSE licensee, or an RSE

licensee of a class prescribed for the purposes of

subsection (1), before:

(i) APRA makes a decision on the application for

authority; or

(ii) if APRA's decision with respect to the application is

subject to review under this Act--the review is finally

determined or otherwise disposed of.

242B Election to transfer amounts held in eligible rollover fund if

authorisation cancelled

An RSE licensee that applies for authority to operate a regulated

superannuation fund as an eligible rollover fund makes an election

in accordance with this section if:

(a) the RSE licensee elects:

(i) to take the action required under the prudential

standards in relation to amounts held in the eligible

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rollover fund, if the authority to operate the fund as an

eligible rollover fund is cancelled under subsection

242J(1); and

(ii) to do so before the end of a period of 90 days beginning

on the day on which notice of the cancellation is given

to the RSE licensee under subsection 242J(3); and

(b) the election is in writing; and

242C Election not to charge members of eligible rollover fund for

payment of conflicted remuneration

(1) An RSE licensee that applies for authority to operate a regulated

superannuation fund as an eligible rollover fund makes an election

in accordance with this section if:

(a) the RSE licensee elects that, if the authority is given, the RSE

licensee will not charge any member of the fund a fee all or

part of which relates directly or indirectly to costs incurred

by a trustee or the trustees of the fund:

(i) in paying conflicted remuneration to a financial services

licensee, or a representative of a financial services

licensee; or

(ii) in paying an amount to another person that a trustee of

the fund knows, or reasonably ought to know, relates to

conflicted remuneration paid by that other person to a

financial services licensee, or a representative of a

financial services licensee; and

(b) the election is in writing; and

(2) In this section:

conflicted remuneration has the same meaning as in Part 7.7A of

the Corporations Act 2001, subject to the extension of that

meaning in subsection (3).

representative, of a financial services licensee, has the same

meaning as in Part 7.6 of the Corporations Act 2001.

(3) In this section, conflicted remuneration also has the meaning it

would have if:

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(a) financial product advice provided to the RSE licensee

mentioned in subsection (1) by a financial services licensee,

or a representative of a financial services licensee, mentioned

in subparagraph (1)(a)(i) or (ii) were provided to the RSE

licensee as a retail client; and

(b) financial product advice provided to the other person

mentioned in subparagraph (1)(a)(ii) by a financial services

licensee, or a representative of a financial services licensee,

mentioned in that subparagraph were provided to the other

person as a retail client.

242D APRA may request further information

APRA may give an RSE licensee that has applied for authority to

operate a regulated superannuation fund as an eligible rollover

fund a notice requesting the RSE licensee to give APRA, in

writing, specified information relating to the application.

Note:

A failure to give the requested information delays the time within

which APRA must decide the application: see paragraph 242E(1)(b).

242E Period for deciding applications for authority

(1) APRA must decide an application by an RSE licensee for authority

to operate a regulated superannuation fund as an eligible rollover

fund:

(a) within 60 days after receiving the application; or

(b) if the applicant was requested to provide information under

section 242D--within 60 days after:

(i) receiving from the RSE licensee all of the information

the RSE licensee was requested to provide under that

section; or

(ii) all notices relating to that information being disposed

of;

unless APRA extends the period for deciding the application under

subsection (2).

(2) APRA may extend the period for deciding an application by an

RSE licensee for authority to operate a regulated superannuation

fund as an eligible rollover fund by up to 60 days if APRA informs

the RSE licensee of the extension:

(a) in writing; and

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(b) within the period in which it would otherwise be required to

decide the application under subsection (1).

(3) If APRA extends the period for deciding an application for

authority to operate a regulated superannuation fund as an eligible

rollover fund, it must decide the application within the extended

period.

(4) If APRA has not decided an application for authority to operate a

regulated superannuation fund as an eligible rollover fund by the

end of the period by which it is required to decide the application,

APRA is taken to have decided, at the end of the last day of that

period, to refuse the application.

Subdivision B--Authority

242F Authority to operate an eligible rollover fund

(1) APRA must authorise an RSE licensee to operate a regulated

superannuation fund as an eligible rollover fund if, and only if:

(a) the application for authority complies with section 242A; and

(b) the applicant has provided to APRA all information that the

applicant was requested, under section 242D, to provide, or

the request has been disposed of; and

(d) the RSE licensee is of a class prescribed for the purposes of

subsection 242A(1); and

(e) APRA is satisfied that, under the governing rules of the fund:

(i) the only purpose of the fund is to be a temporary

repository for amounts transferred to the fund from

other regulated superannuation funds in circumstances

allowed by the RSE licensee law; and

(ii) a single diversified investment strategy is to be adopted

in relation to all assets of the fund; and

(f) APRA is satisfied that the RSE licensee is likely to comply

with the enhanced trustee obligations for eligible rollover

funds; and

(g) APRA is satisfied that the directors of the RSE licensee are

likely to comply with the enhanced director obligations for

eligible rollover funds; and

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(h) APRA is satisfied that the RSE licensee is likely to comply

with the general fees rules; and

(i) APRA is satisfied that the RSE licensee is not likely to

contravene section 242P.

(2) Otherwise APRA must refuse to give the authority.

242G Notice of authority

If APRA authorises an RSE licensee to operate a regulated

superannuation fund as an eligible rollover fund, APRA must

notify the RSE licensee in writing of the authority.

242H APRA to give notice of refusal of authority

If APRA refuses an application by an RSE licensee for authority to

operate a regulated superannuation fund as an eligible rollover

fund, APRA must take all reasonable steps to ensure that the RSE

licensee is given a notice:

(a) informing it of APRA's refusal of the application; and

(b) setting out the reasons for the refusal;

as soon as practicable after refusing the application.

Subdivision C--Cancelling authority

242J Cancelling authority to operate eligible rollover fund

(1) APRA may, in writing, cancel an authority to operate a regulated

superannuation fund as an eligible rollover fund.

(2) Without limiting subsection (1), APRA may cancel an authority to

operate a regulated superannuation fund as an eligible rollover

fund if:

(a) APRA is no longer satisfied that, under the governing rules

of the fund:

(i) the only purpose of the fund is to be a temporary

repository for amounts transferred to the fund from

other regulated superannuation funds in circumstances

allowed by the RSE licensee law; and

(ii) a single diversified investment strategy is to be adopted

in relation to all assets of the fund; or

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(b) APRA is no longer satisfied that the RSE licensee is likely to

comply with the enhanced trustee obligations for eligible

rollover funds (whether because of a previous failure to do

so, or for any other reason); or

licensee are likely to comply with the enhanced director

obligations for eligible rollover funds (whether because of a

previous failure to do so, or for any other reason); or

(d) APRA is no longer satisfied that the RSE licensee is likely to

comply with the general fees rules (whether because of a

previous failure to do so, or for any other reason); or

(e) APRA is no longer satisfied that the RSE licensee is not

likely to contravene section 242P (whether because of a

previous contravention of that section, or for any other

reason); or

(f) the fund ceases to be registered under Part 2B; or

(g) the RSE licensee ceases to be of a class prescribed for the

purposes of subsection 242A(1); or

(h) APRA is satisfied that the RSE licensee has contravened a

provision of the governing rules of the eligible rollover fund;

(i) APRA is satisfied that the RSE licensee has failed to give

effect to an election made in accordance with section 242C

(election not to pass costs of conflicted remuneration to

members of eligible rollover fund).

(3) If APRA cancels an authority to operate a regulated

superannuation fund as an eligible rollover fund it must take all

reasonable steps to ensure that the RSE licensee is given a notice

informing the RSE licensee:

(a) that APRA has cancelled the authority; and

(b) of the reasons for the cancellation.

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Subdivision D--Trustee obligations relating to eligible rollover

funds

242K Additional obligations of a trustee in relation to an eligible

rollover fund

Each trustee of an eligible rollover fund must promote the financial

interests of the beneficiaries of the fund, in particular returns to

those beneficiaries (after the deduction of fees, costs and taxes).

242L Additional obligations of a director of a corporate trustee in

relation to an eligible rollover fund

(1) Each director of a corporate trustee of an eligible rollover fund

must exercise a reasonable degree of care and diligence for the

purposes of ensuring that the corporate trustee carries out the

obligations referred to in section 242K.

(2) The reference in subsection (1) to a reasonable degree of care and

diligence is a reference to the degree of care and diligence that a

superannuation entity director would exercise in the corporate

trustee's circumstances.

242M Contravention of section 242K or 242L

(1) A person must not contravene section 242K or 242L.

(2) Subsection (1) is a civil penalty provision as defined by

section 193, and Part 21 therefore provides for civil and criminal

consequences of contravening, or of being involved in a

contravention of, that subsection.

(3) A contravention of subsection (1) does not result in the invalidity

of a transaction.

242N Governing rules void to the extent that they are inconsistent

with obligations under section 242K or 242L

A provision of the governing rules of an eligible rollover fund is

void to the extent that it is inconsistent with:

(a) the obligations that apply to a trustee of the fund under

section 242K; or

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(b) the obligations that apply to the directors of a corporate

trustee of the fund under section 242L.

Subdivision E--Miscellaneous

242P Operating a fund as an eligible rollover fund when not

authorised to do so

(1) A person commits an offence if:

(a) the person makes a representation; and

(b) the representation is that a regulated superannuation fund is

an eligible rollover fund; and

operate the fund as an eligible rollover fund.

Penalty: 60 penalty units.

Note:

Chapter 2 of the Criminal Code sets out the general principles of

criminal responsibility and Part IA of the Crimes Act 1914 contains

provisions dealing with penalties.

(2) Subsection (1) is an offence of strict liability.

Note:

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

242Q Prudential standards dealing with amounts held in eligible

rollover funds

A prudential standard determined under section 34C may include

provisions:

(a) requiring an RSE licensee whose authority to operate a

regulated superannuation fund as an eligible rollover fund is

cancelled under subsection 242J(1) to transfer any amounts

held in the eligible rollover fund to a regulated

superannuation fund that:

(i) is an eligible rollover fund; or

(ii) offers a MySuper product; and

(b) setting out the requirements that must be met in relation to

the transfer of such amounts; and

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242R No liability for giving effect to a section 242B election

A trustee of a regulated superannuation fund is not subject to any

liability to a member of the fund for an action taken to give effect

to an election made in accordance with section 242B.

16 Before section 243

Insert:

Division 3--Facility to pay benefits to eligible rollover

funds

17 At the end of the Act

Add:

Part 34--Additional transitional provisions relating

to eligible rollover funds

391 Definitions

In this Part:

existing ERF means a regulated superannuation fund that is an

eligible rollover fund within the meaning of the old law

immediately before the commencement of this section.

old law means this Act as in force immediately before the

commencement of this section.

392 Authority to operate an eligible rollover fund given before

1 January 2014

If, before 1 January 2014, APRA authorises an RSE licensee to

operate a regulated superannuation fund as an eligible rollover

fund, that authority takes effect on 1 January 2014.

393 Operation of existing ERFs after commencement

Despite the amendments made by Schedule 7 to the

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Transparency Measures) Act 2012, an existing ERF is taken to be

an eligible rollover fund for the purposes of Division 3 of Part 24

during the period:

(a) beginning on the day this section commences; and

(b) ending on 31 December 2013.

394 Moving amounts held in existing ERFs

(1)

If:

(a) immediately before 1 January 2014, an amount is held in an

existing ERF; and

(b) on that day, the RSE licensee of the existing ERF is not

authorised to operate the existing ERF as an eligible rollover

fund;

the RSE licensee of the existing ERF must take the action required

under the prudential standards in relation to the amount before the

end of a period of 90 days beginning on 1 January 2014.

(2) A prudential standard determined under section 34C may include

provisions:

(a) requiring an RSE licensee of an existing ERF to, in the

circumstances mentioned in subsection (1), transfer the

amount held in the existing ERF to a regulated

superannuation fund that:

(i) is an eligible rollover fund; or

(ii) offers a MySuper product; and

(b) setting out the requirements that must be met in relation to

the transfer of such an amount; and

(3) A trustee of a regulated superannuation fund is not subject to any

liability to any member of the fund for an action taken in

accordance with this section.

(4) This section does not apply to the extent that its operation would

result in an acquisition of property (within the meaning of

paragraph 51(xxxi) of the Constitution) from a person otherwise

than on just terms (within the meaning of that paragraph).

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Schedule 8--Other amendments

Superannuation Guarantee (Administration) Act 1992

1 Subsection 6(1)

Insert:

MySuper member has the same meaning as in the Superannuation

Industry (Supervision) Act 1993.

Superannuation Industry (Supervision) Act 1993

2 Subsection 10(1) (definition of buy-sell spread)

Repeal the definition, substitute:

buy-sell spread has the meaning given by subsection 29V(4).

3 Subsection 10(1)

Insert:

MySuper member: A member of a regulated superannuation fund

is a MySuper member of the fund if the member holds a beneficial

interest in the fund of a class that the RSE licensee of the fund is

authorised to offer as a MySuper product.

Commonwealth of Australia Bills

SUPERANNUATION LEGISLATION AMENDMENT (FURTHER MYSUPER AND TRANSPARENCY MEASURES) BILL 2012