66Acquisitions of certain assets from members of regulated superannuation funds prohibited

66 Acquisitions of certain assets from members of regulated superannuation funds prohibited

Prohibition (1) Subject to subsection (2), a trustee or an investment manager of a regulated superannuation fund must not intentionally acquire an asset from a related party of the fund. Exception—acquisitions of business real property and listed securities (2) Subsection (1) does not prohibit a trustee or investment manager acquiring an asset from a related party of the fund if: (a) the asset is a listed security acquired at market value; or (b) if the fund is a superannuation fund with no more than 6 members—the asset is business real property of the related party acquired at market value; or (c) the trustee of a regulated superannuation fund acquired the asset under a merger between regulated superannuation funds; or (d) the asset is an asset of a kind which the Regulator, by legislative instrument, determines may be acquired by: (i) any fund; or (ii) a class of funds in which the fund is included. Exception—certain in‑house assets (2A) Subsection (1) does not prohibit the acquisition of an asset by a trustee or investment manager of a superannuation fund from a related party of the fund if: (a) the acquisition of the asset constitutes an investment that: (i) is an in‑house asset of the fund within the meaning of subsection 71(1); or (ii) would be an in‑house asset of the fund within the meaning of subsection 71(1) apart from the operation of Subdivision D of Part 8; or (iii) is a life insurance policy issued by a life insurance company (other than a policy acquired from a member of the fund or from a relative of a member); or (iv) is referred to in paragraph 71(1)(b), (ba), (c), (d), (e), (f), (h) or (j); and (b) the asset is acquired at market value; and (c) the acquisition of the asset would not result in the level of in‑house assets of the superannuation fund exceeding the level permitted by Part 8. Exception—breakdown of relationships (2B) Subsection (1) does not prohibit a trustee or investment manager acquiring an asset from a related party of the fund (the acquiring fund) if: (a) the asset is acquired: (i) for the benefit of a particular member of the acquiring fund; and (ii) from a trustee or investment manager of another regulated superannuation fund (the transferring fund); and (b) at the time of the acquisition: (i) the member and his or her spouse or former spouse are separated; and (ii) there is no reasonable likelihood of cohabitation being resumed; and (c) the acquisition occurs because of reasons directly connected with the breakdown of the relationship between the spouses or former spouses; and (d) the asset represents the whole, or a part, of either: (i) the member’s own interests in the transferring fund; or (ii) the member’s entitlements as determined under Part VIIIB or VIIIC of the Family Law Act 1975 in relation to the interests of the member’s spouse, or former spouse, in the transferring fund. (2C) For the purposes of subsection (2B), the question whether the spouses, or former spouses, have separated is to be determined in the same way as it is for the purposes of section 48 of the Family Law Act 1975 (as affected by sections 49 and 50 of that Act). Prohibition of avoidance schemes (3) A person must not enter into, commence to carry out, or carry out a scheme if the person entered into, commenced to carry out, or carried out the scheme or any part of the scheme with the intention that: (a) the scheme would result, or be likely to result, in the acquisition of an asset by a trustee or an investment manager of a regulated superannuation fund, where the asset is acquired from a person who has a connection (either direct or indirect through one or more interposed companies, partnerships or trusts) with a related party of the fund; and (b) that acquisition would avoid the application of subsection (1) to the fund. Offence (4) A person who contravenes subsection (1) or (3) commits an offence punishable on conviction by imprisonment for a term not exceeding 1 year. Definitions (5) In this section: