Corporations Legislation Amendment
(Financial Services Modernisation) Act
2009
No. 108, 2009
An Act to amend the Corporations Act 2001 and the
Australian Securities and Investments Commission
Act 2001 , and for related purposes
Contents
1
Short title
1
2
Commencement
2
3
Schedule(s)
3
Schedule 1—Margin lending facilities

4
Corporations Act 2001
4
Schedule 2—Trustee companies
19
Australian Securities and Investments Commission Act 2001
19
Corporations Act 2001
22
Schedule 3—Debentures
71
Corporations Act 2001
71
Schedule 4—Technical amendment
73
Corporations Act 2001
73
Schedule 5—Application and transitional provisions
74
Corporations Act 2001
74
Corporations Legislation Amendment
(Financial Services Modernisation) Act
2009

No. 108, 2009
An Act to amend the Corporations Act 2001 and the
Australian Securities and Investments Commission
Act 2001 , and for related purposes
[Assented to 6 November 2009 ] The Parliament of Australia enacts:
1 Short title
This Act may be cited as the Corporations Legislation
Amendment (Financial Services Modernisation) Act 2009 .
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.
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 on which this Act receives the
Royal Assent.
6 November
2009

2. Schedule 1 A single day to be fixed by Proclamation.
However, if any of the provision(s) do not
commence within the period of 6 months
beginning on the day on which this Act
receives the Royal Assent, they commence
on the first day after the end of that
period.
3. Schedule 2 A single day to be fixed by Proclamation.
However, if any of the provision(s) do not
commence within the period of 6 months
beginning on the day on which this Act
receives the Royal Assent, they commence
on the first day after the end of that
period.
4. Schedule 3,
item 1
The day on which this Act receives the
Royal Assent.
6 November
2009
5. Schedule 3,
items 2 and 3
A single day to be fixed by Proclamation.
However, if any of the provision(s) do not
commence within the period of 6 months
beginning on the day on which this Act
receives the Royal Assent, they commence
on the first day after the end of that
period.
6. Schedule 4 The day on which this Act receives the
Royal Assent.
6 November
2009
7. Schedule 5 The day on which this Act receives the
Royal Assent.
6 November
2009
Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.
(2) Column 3 of the table contains additional information that is
not part of this Act. Information in this column may be added
to or 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 concerned, and any other item in a Schedule to this
Act has effect according to its terms.

Schedule 1—Margin lending facilities
Corporations Act 2001
1 Section 760B (table item 8)
Repeal the item, substitute:
8 7.8 other conduct requirements for financial services licensees (e.g.
dealing with client money and property; financial records,
statements and audit)
special provisions relating to insurance
special provisions relating to margin lending facilities
2 Section 761A
Insert:
current LVR :
(a) in relation to a standard margin lending facility—has
the meaning given by subsection 761EA(3); and
(b) in relation to a non-standard margin lending facility
—has the meaning given by subsection 761EA(6).
3 Section 761A
Insert:
limit , in relation to a margin lending facility, has the meaning
given by subsection 761EA(11).
4 Section 761A
Insert:
margin call :
(a) in relation to a standard margin lending facility—has
the meaning given by subsection 761EA(4); and
(b) in relation to a non-standard margin lending facility
—has the meaning given by subsection 761EA(7); and
(c) in relation to a facility that ASIC has declared to be a
margin lending facility under subsection 761EA(8)—has
the meaning given in the declaration.

5 Section 761A
Insert:
margin lending facility has the meaning given by subsection
761EA(1).
6 Section 761A
Insert:
non-standard margin lending facility has the meaning given by
subsection 761EA(5).
7 Section 761A
Insert:
standard margin lending facility has the meaning given by
subsection 761EA(2).
8 Subsection 761E(3) (at the end of the table)
Add:
4 margin lending facility the person enters into the legal
relationship that constitutes the margin
lending facility, as the client under the
facility
9 After section 761E
Insert:
761EA Meaning of margin lending facility , margin call and associated
expressions
(1) A margin lending facility is:
(a) a standard margin lending facility; or
(b) a non-standard margin lending facility; or
(c) a facility of a kind that has been declared by ASIC to
be a margin lending facility under subsection (8);
unless the facility is of a kind that has been declared by ASIC
not to be a margin lending facility under subsection (9).
Standard margin lending facilities
(2) A standard margin lending facility is a facility under the
terms of which:

(a) credit is, or may be, provided by a person (the
provider ) to a natural person (the client ); and
(b) the credit provided is, or must be, applied wholly or
partly:
(i) to acquire one or more financial products, or a
beneficial interest in one or more financial products;
or
(ii) to repay, wholly or partly, another credit facility
(within the meaning of subparagraph 765A(1)(h)(i)),
the credit provided under which was applied, wholly
or partly, to acquire one or more financial products,
or a beneficial interest in one or more financial
products; and
(c) the credit provided is, or must be, secured by
property (the secured property ); and
(d) the secured property consists, or must consist, wholly
or partly of one or more marketable securities, or a
beneficial interest in one or more marketable securities;
and
(e) if the current LVR of the facility exceeds a ratio,
percentage, proportion or level (however described)
determined under the terms of the facility, then:
(i) the client becomes required to take action; or
(ii) the provider becomes entitled to take action; or
(iii) another person becomes required or entitled to take
action;
in accordance with the terms of the facility to reduce
the current LVR of the facility.
(3) The current LVR of a standard margin lending facility at a
particular time is the ratio, percentage, proportion or level
(however described) that:
(a) is determined under the terms of the facility; and
(b) under the terms of the facility, represents a particular
relationship between:
(i) the amount of the debt owing by the client, or credit
provided by the provider, or both, under the facility
at that time; and
(ii) the value of the secured property determined at that
time under the terms of the facility.
(4) A standard margin lending facility is in margin call when
paragraph (2)(e) applies in relation to the facility.

Non-standard margin lending facilities
(5) A non-standard margin lending facility is a facility under
the terms of which:
(a) a natural person (the client ) transfers one or more
marketable securities, or a beneficial interest in one or
more marketable securities (the transferred securities ) to
another person (the provider ); and
(b) the provider transfers property to the client (the
transferred property ) as consideration or security for the
transferred securities; and
(c) the transferred property is, or must be, applied
wholly or partly to acquire one or more financial
products, or a beneficial interest in one or more financial
products; and
(d) the client has a right, in the circumstances
determined under the terms of the facility, to be given
marketable securities equivalent to the transferred
securities; and
(e) if the current LVR of the facility exceeds a ratio,
percentage, proportion or level (however described)
determined under the terms of the facility, then:
(i) the client becomes required to take action; or
(ii) the provider becomes entitled to take action; or
(iii) another person becomes required or entitled to take
action;
in accordance with the terms of the facility to reduce
the current LVR of the facility.
(6) The current LVR of a non-standard margin lending facility
at a particular time is the ratio, percentage, proportion or level
(however described) that:
(a) is determined under the terms of the facility; and
(b) under the terms of the facility, represents a particular
relationship between:
(i) an amount determined at that time under the terms of
the facility by reference to the value of the
transferred property and any amount owing by the
client to the provider; and
(ii) the value of the transferred securities determined at
that time under the terms of the facility.
(7) A non-standard margin lending facility is in margin call
when paragraph (5)(e) applies in relation to the facility.

ASIC declarations in relation to margin lending facilities
(8) ASIC may declare that a particular kind of facility is a
margin lending facility . The declaration must give the meanings
of margin call and limit in relation to that kind of facility.
(9) ASIC may declare that a particular kind of facility is not a
margin lending facility .
(10) A declaration made under subsection (8) or (9):
(a) must be in writing; and
(b) is a legislative instrument for the purposes of the
Legislative Instruments Act 2003 .
Meaning of limit of a margin lending facility
(11) The limit of a margin lending facility:
(a) in relation to a standard margin lending facility—
means the maximum amount of credit that may be
provided by the provider to the client under the facility;
and
(b) in relation to a non-standard margin lending facility
—means the maximum amount of property that may be
transferred by the provider to the client under the facility;
and
(c) in relation to a facility of a kind that ASIC has
declared to be a margin lending facility under
subsection (8)—has the meaning given in the declaration.
10 After paragraph 764A(1)(k)
Insert:
(l) a margin lending facility;
11 At the end of subparagraph 765A(1)(h)(i)
Add “(other than a margin lending facility)”.
11A After subsection 911A(5)
Insert:
(5A) Despite paragraph (2)(b), the regulations may provide that
the exemption under that paragraph does not apply in relation
to:
(a) a particular financial product or a particular kind of
financial product; or
(b) a particular financial product or a particular kind of

financial product that is issued, varied or disposed of by a
particular person, or a particular kind of person.
12 After Division 4 of Part 7.8
Insert:
Division 4A—Special provisions relating to margin
lending facilities
Subdivision A—Responsible lending conduct for margin
lending facilities
985EA Application of this Subdivision
This Subdivision applies to a financial services licensee (the
provider ) in relation to:
(a) the issuing of a margin lending facility to a retail
client; or
(b) the increasing of the limit of a margin lending
facility that was issued to a retail client.
985E Requirements before issuing etc. margin lending facility
Requirement to make assessment of unsuitability
(1) The provider must not:
(a) issue the margin lending facility to the retail client;
or
(b) increase the limit of the margin lending facility that
was issued to the retail client;
on a day (the critical day ) unless the provider has, within 90
days (or other period prescribed by the regulations) before the
critical day:
(c) made an assessment that:
(i) is in accordance with section 985F; and
(ii) covers a period in which the critical day occurs; and
(d) made the inquiries and verification in accordance
with section 985G.
Note: This subsection is a civil penalty provision (see section 1317E).
Increase in limit of standard margin lending facility

(2) For the purposes of paragraph (1)(b), the limit of a standard
margin lending facility is taken not to be increased if:
(a) apart from this subsection, there would be an
increase in the limit; and
(b) the increase in the limit would result from an
increase in the value, determined under the terms of the
facility, of the secured property under the facility (as
referred to in paragraph 761EA(2)(c)); and
(c) the increase in the value of the secured property does
not result from the client contributing additional property
to the secured property.
Regulations
(3) For the purposes of paragraph (1)(b), the regulations may
prescribe particular situations in which the limit of a margin
lending facility is taken:
(a) to be increased, despite subsection (2); or
(b) not to be increased.
985F Assessment of unsuitability of margin lending facility
For the purposes of paragraph 985E(1)(c), the provider
must make an assessment that:
(a) specifies the period the assessment covers; and
(b) assesses whether the margin lending facility will be
unsuitable for the retail client if the facility is issued or the
limit is increased in that period.
Note: The provider is not required to make the assessment if the margin lending facility is not issued or the limit is not increased.
985G Reasonable inquiries etc. about the retail client
Requirement to make inquiries and take steps to verify
(1) For the purposes of paragraph 985E(1)(d), the provider
must, before making the assessment:
(a) make reasonable inquiries about the retail client’s
financial situation; and
(b) take reasonable steps to verify the retail client’s
financial situation; and
(c) make any inquiries prescribed by the regulations
about any matter prescribed by the regulations; and
(d) take any steps prescribed by the regulations to verify

any matter prescribed by the regulations.
(2) The regulations may prescribe particular inquiries or steps
that must be made or taken, or do not need to be made or taken,
for the purposes of paragraph (1)(a) or (b).
When not required to take steps to verify
(3) Despite subsection (1), if:
(a) a financial services licensee that is authorised to
provide financial product advice in relation to margin
lending facilities has prepared a statement of advice for
the retail client; and
(b) the statement of advice was prepared no more than
90 days before the critical day; and
(c) the statement of advice recommends that:
(i) the retail client acquire the particular margin lending
facility; or
(ii) the limit of the particular margin lending facility be
increased; and
(d) the limit of the facility, or the increase in the limit of
the facility, is not greater than the limit, or the increase in
the limit, recommended in the statement of advice; and
(e) the statement of advice includes the information that
was used for the purposes of preparing the statement of
advice;
then the provider is not required, for the purposes of
paragraph (1)(b) or (d), to verify that information.
985H When margin lending facility must be assessed as unsuitable
Requirement to assess the margin lending facility as unsuitable
(1) The provider must assess that the margin lending facility will
be unsuitable for the retail client if the margin lending facility
will be unsuitable for the retail client under subsection (2).
Note 1: This subsection is a civil penalty provision (see section 1317E).
Note 2: Even if the margin lending facility will not be unsuitable for the retail client under subsection (2), the provider may still assess that the margin lending facility will be unsuitable for the retail client for other reasons.
(2) The margin lending facility will be unsuitable for the retail
client if, at the time of the assessment, it is likely that:
(a) if the facility is issued or the limit increased in the

period covered by the assessment, and the facility were to
go into margin call, the retail client:
(i) would be unable to comply with the retail client’s
financial obligations under the terms of the facility;
or
(ii) could only comply with substantial hardship; or
(b) if the regulations prescribe circumstances in which a
margin lending facility is unsuitable—those circumstances
will apply to the margin lending facility if the facility is
issued or the limit increased in the period covered by the
assessment.
Information to be used to make the assessment
(3) For the purposes of determining under subsection (2)
whether the margin lending facility will be unsuitable, only
information that satisfies both of the following paragraphs is to
be taken into account:
(a) the information is about the retail client’s financial
situation, or any other matter prescribed by regulations
under paragraph 985G(1)(c) or (d);
(b) at the time of the assessment:
(i) the provider had reason to believe that the
information was true; or
(ii) the provider would have had reason to believe that
the information was true if it had made the inquiries
or verification under section 985G.
985J Giving the retail client the assessment
Requirement to give assessment if requested
(1) If, before the margin lending facility is issued or the limit is
increased, the retail client requests a copy of the assessment
from the provider, the provider must give the retail client a
written copy of the assessment before issuing the facility or
increasing the limit.
Note 1: Failure to comply with this subsection is an offence (see subsection 1311(1)).
Note 2: This subsection is a civil penalty provision (see section 1317E).
Note 3: The provider is not required to give the retail client a copy of the assessment if the margin lending facility is not issued or the limit is not increased.
(2) If, during the period that:

(a) starts on the critical day referred to in subsection
985E(1); and
(b) ends 7 years after that day;
the retail client requests a copy of the assessment from the
provider, the provider must give the retail client a written copy
of the assessment:
(c) if the request is made within 2 years of the critical
day—before the end of 7 business days after the day the
provider receives the request; and
(d) otherwise—before the end of 21 business days after
the day the provider receives the request.
Note 1: Failure to comply with this subsection is an offence (see subsection 1311(1)).
Note 2: This subsection is a civil penalty provision (see section 1317E).
Manner of giving assessment
(3) The provider must give the retail client the copy of the
assessment in the manner (if any) prescribed by the regulations.
No payment for assessment
(4) The provider must not request or demand payment of an
amount for giving the retail client a copy of the assessment.
Note 1: Failure to comply with this subsection is an offence (see subsection 1311(1)).
Note 2: This subsection is a civil penalty provision (see section 1317E).
Strict liability
(5) An offence based on subsection (1), (2) or (4) is an offence
of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code .
985K Unsuitable margin lending facilities
Requirement not to issue unsuitable margin lending facilities
etc.
(1) The provider must not:
(a) issue the margin lending facility to the retail client;
or
(b) increase the limit of the margin lending facility that
was issued to the retail client;

if the facility is unsuitable for the retail client under
subsection (2).
Note 1: Failure to comply with this subsection is an offence (see subsection 1311(1)).
Note 2: This subsection is a civil penalty provision (see section 1317E).
When a margin lending facility will be unsuitable
(2) The margin lending facility is unsuitable for the retail client
if, at the time it is issued or the limit is increased:
(a) it is likely that, if the facility were to go into margin
call, the retail client:
(i) would be unable to comply with the retail client’s
financial obligations under the terms of the facility;
or
(ii) could only comply with substantial hardship; or
(b) if the regulations prescribe circumstances in which a
margin lending facility is unsuitable—those circumstances
apply to the margin lending facility.
Information to be used for the purposes of subsection (2)
(3) For the purposes of determining under subsection (2)
whether the margin lending facility will be unsuitable, only
information that satisfies both of the following paragraphs is to
be taken into account:
(a) the information is about the retail client’s financial
situation, or any other matter prescribed by regulations
under paragraph 985G(1)(c) or (d);
(b) at the time the margin lending facility is issued or the
limit is increased:
(i) the provider had reason to believe that the
information was true; or
(ii) the provider would have had reason to believe that
the information was true if it had made the inquiries
or verification under section 985G.
Regulations in relation to unsuitability of margin lending
facility
(4) The regulations may prescribe particular situations in which
a margin lending facility is taken not to be unsuitable for a retail
client, despite subsection (2).
Increase in limit of standard margin lending facility

(5) For the purposes of paragraph (1)(b), the limit of a standard
margin lending facility is taken not to be increased if:
(a) apart from this subsection, there would be an
increase in the limit; and
(b) the increase in the limit would result from an
increase in the value, determined under the terms of the
facility, of the secured property under the facility (as
referred to in paragraph 761EA(2)(c)); and
(c) the increase in the value of the secured property does
not result from the client contributing additional property
to the secured property.
Regulations in relation to increase in limit
(6) For the purposes of paragraph (1)(b), the regulations may
prescribe particular situations in which the limit of a margin
lending facility is taken:
(a) to be increased, despite subsection (5); or
(b) not to be increased.
Subdivision B—Notice of margin calls under margin lending
facilities
985L Issue of margin lending facility must not be conditional on
agreement to receive communications through agent
A financial services licensee must not require, as a condition
of issuing a margin lending facility to a retail client, that the
retail client enter into an agreement of the kind referred to in
subsection 985M(2) (which deals with agreements about
communications in relation to margin lending facilities).
Note: This section is a civil penalty provision (see section 1317E).
985M Notification of margin calls
Provider must notify retail client of margin call
(1) A financial services licensee (the provider ) that has issued a
margin lending facility to a retail client must, when the facility
goes into margin call, take reasonable steps to notify the retail
client under the facility of the margin call in accordance with
this section.
Note: This subsection is a civil penalty provision (see section 1317E).

When provider must notify retail client’s agent, and agent must
notify retail client, of margin call
(2) However, if there is an agreement between the provider, the
retail client, and another financial services licensee (the agent )
that the agent will receive communications from the provider in
relation to the margin lending facility on behalf of the retail
client, then:
(a) the provider must take reasonable steps to notify the
agent (instead of the retail client) of the margin call in
accordance with this section; and
(b) the agent must take reasonable steps to notify the
retail client of the margin call in accordance with this
section.
Note: This subsection is a civil penalty provision (see section 1317E).
When and how notice must be given
(3) A notice under this section must be given:
(a) at a time determined by ASIC; or
(b) if no time is determined by ASIC—as soon as
practicable.
(4) A notice under this section must be given:
(a) if a manner in which the notice is to be given has
been agreed between the person who is required to give
the notice and the person to whom the notice is required
to be given—in that manner; or
(b) if there is no agreement and ASIC has determined
the manner in which the notice is to be given—in that
manner; or
(c) otherwise—in a reasonable manner.
ASIC may determine when and how notice must be given
(5) ASIC may determine:
(a) the time by which, and manner in which, a provider
must notify a client or agent of a margin call under this
section; and
(b) the time by which, and manner in which, an agent
must notify a client of a margin call under this section.
(6) A determination made under subsection (5):
(a) must be in writing; and
(b) is a legislative instrument for the purposes of the

Legislative Instruments Act 2003 .
13 Subsection 1016A(1) (after paragraph (da) of the definition
of relevant financial product )
Insert:
(db) a margin lending facility; or
14 After subparagraph 1017D(1)(b)(v)
Insert:
(va) a margin lending facility; or
15 After paragraph 1317E(1)(ja)
Insert:
(jaa) subsection 985E(1) (issuing or increasing limit of
margin lending facility without having made assessment
etc.);
(jab) subsection 985H(1) (failure to assess a margin
lending facility as unsuitable);
(jac) subsection 985J(1) (failure to give assessment to
retail client if requested before issue of facility or increase
in limit);
(jad) subsection 985J(2) (failure to give assessment to
retail client if requested after issue of facility or increase in
limit);
(jae) subsection 985J(4) (demanding payment to give
assessment to retail client);
(jaf) subsection 985K(1) (issuing or increasing limit of
margin lending facility if unsuitable);
(jag) section 985L (making issue of margin lending
facility conditional on retail client agreeing to receive
communications through agent);
(jah) subsection 985M(1) (failure to notify of margin call
where there is no agent);
(jai) subsection 985M(2) (failure to notify of margin call
where there is an agent);
16 Schedule 3 (after table item 282BA)
Insert:
282BB Subsection 985J(1) 50 penalty units.
282BC Subsection 985J(2) 50 penalty units.
282BD Subsection 985J(4) 50 penalty units.

282BE Subsection 985K(1) 100 penalty units, or imprisonment for 2
years, or both.

Schedule 2—Trustee companies
Australian Securities and Investments Commission Act 2001
1 Subsection 5(1)
Insert:
traditional trustee company services has the same meaning as in
Chapter 5D of the Corporations Act.
2 Subsection 5(1)
Insert:
trustee company has the same meaning as in Chapter 5D of the
Corporations Act.
2A Subsection 5(1)
Insert:
trust property , in relation to a trustee company, means property
that is or was held by the trustee company as trustee.
3 After subsection 12BAB(1)
Insert:
(1A) Subject to paragraph (2)(b), the provision by a trustee
company of a traditional trustee company service constitutes the
provision, by the company, of a financial service for the
purposes of this Division.
Note: Trustee companies may also provide other kinds of financial service mentioned in subsection (1).
(1B) The regulations may, in relation to a traditional trustee
company service of a particular class, prescribe the person or
persons to whom a service of that class is taken to be provided
or supplied for the purposes of this Division. This subsection
does not limit (and is not limited by) subsection (2).
3A Subsection 12CC(5)
After “financial products”, insert “or financial services”.
3B Division 4 of Part 3 (heading)

Repeal the heading, substitute:
Division 4—Requirements to disclose information
3C Section 40
After “section 41”, insert “or 42”.
3D At the end of paragraph 40(c)
Add:
(iii) an alleged or suspected contravention, by a trustee
company, of a law of the Commonwealth, or of a State or
Territory, being a contravention that involves fraud or
dishonesty and that relates to trust property; or
3E After section 41
Insert:
42 Acquisitions and disposals of trust property by trustee
companies
(1) ASIC may require a trustee company to disclose to it, in
relation to an acquisition or disposal of trust property by the
trustee company, all or any of the following:
(a) the name of:
(i) the person from or through whom the trust property
was acquired; or
(ii) the person to or through whom the trust property
was disposed;
(b) whether the acquisition or disposal was effected on
the instructions of another person, and the nature of any
such instructions;
(c) the names of the beneficiaries of the trust.
Note: Failure to comply with a requirement made under this subsection is an offence (see section 63).
(2) Information required to be disclosed under this section need
only be disclosed to the extent to which it is known to the
person required to make the disclosure.
Note: In criminal proceedings, a defendant bears an evidential burden in relation to the matters in subsection (2).
(3) An offence under subsection 63(2) relating to subsection (1)
of this section is an offence of strict liability.

Note: For strict liability, see section 6.1 of the Criminal Code .
3F After section 43
Insert:
44 Exercise of certain powers of ASIC in relation to trust property
acquired or disposed of by trustee company
(1) This section applies if ASIC considers that a contravention of
a law of the Commonwealth, or of a State or Territory, may
have been committed by a trustee company, being a
contravention that involves fraud or dishonesty and that relates
to trust property.
(2) ASIC may require a director, secretary or senior manager of
the trustee company to disclose to ASIC information of which
he or she is aware and that may have affected an acquisition or
disposal of trust property by the trustee company.
Note: Failure to comply with a requirement made under this subsection is an offence (see section 63).
(3) If ASIC believes on reasonable grounds that a person can
give information about particular matters, being any or all of
the following:
(a) an acquisition or disposal of trust property by the
trustee company;
(b) the financial position of the trustee company;
(c) an audit of, or a report of an auditor about, accounts
or records of the trustee company;
ASIC may require the person to disclose to it the information
that the person has about those particular matters.
Note: Failure to comply with a requirement made under this subsection is an offence (see section 63).
(4) An offence under subsection 63(2) relating to subsection (2)
or (3) of this section is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code .
(5) ASIC must not exercise a power conferred by subsection (2)
or (3) except for the purpose of investigating the possible
contravention referred to in subsection (1).
3G Subsection 63(2)
Omit “section 41 or 43”, substitute “section 41, 42, 43 or 44”.

3H After paragraph 71(b)
Insert:
or (c) trust property acquired or disposed of by a trustee
company;
3J After subsection 73(1)
Insert:
(1A) If paragraph 71(c) applies, ASIC may make one or more of
the following:
(a) an order restraining a specified person from
disposing of any interest in specified trust property;
(b) an order restraining a specified person from
acquiring any interest in specified trust property;
(c) an order directing a body corporate not to pay,
except in the course of winding up, a sum due from the
body corporate in respect of specified trust property;
(d) an order directing a body corporate not to register
the transfer or transmission of specified trust property.
Note: The heading to section 73 is altered by inserting “ and trust property ” after “financial products ”.
3K Subsections 73(2) and (3)
After “subsection (1)”, insert “or (1A)”.
Corporations Act 2001
4 Subsection 5A(4)
After “Chapter”, insert “5D,”.
5 At the end of subsection 5D(2)
Add:
Note: This Part does not apply in relation to the trustee company provisions: see section 601RAE.
6 After paragraph 283AC(1)(a)
Insert:
(aa) a licensed trustee company (within the meaning of
Chapter 5D); or
7 Section 490

Before “Except”, insert “(1)”.
8 At the end of section 490
Add:
; or (c) the company is a trustee company (within the
meaning of Chapter 5D) that is in the course of
administering or managing one or more estates.
(2) A person with a proper interest (within the meaning of
Chapter 5D) in the estate referred to in paragraph (1)(c), or who
has any claim in respect of the estate, is entitled to be heard in a
proceeding before the Court for leave under subsection (1).
9 After Chapter 5C
Insert:
Chapter 5D—Licensed trustee companies
Part 5D.1—Preliminary
601RAA Definitions
In this Chapter:
client , in relation to a trustee company, has the meaning given
by subsection 601RAB(3).
estate management functions has the meaning given by
subsection 601RAC(2).
estate that is administered or managed , in relation to a trustee
company, means all or any of the estate of a person (whether
living or dead) that is administered or managed by the trustee
company in the course of performing estate management
functions.
fees means fees in the nature of remuneration (including
commission).
law means a law of the Commonwealth or of a State or
Territory, and includes a rule of common law or equity.
licensed trustee company means a trustee company that holds an
Australian financial services licence covering the provision of
one or more traditional trustee company services.

Note: Traditional trustee company services are financial services for the purpose of Chapter 7: see subsection 766A(1A).
person with a proper interest , in relation to an estate, has the
meaning given by section 601RAD.
publish : if the regulations prescribe requirements to be
complied with in relation to an obligation in a provision of this
Part to publish something, publish (in that provision) means
publish in accordance with those requirements.
traditional trustee company services has the meaning given by
subsection 601RAC(1).
trustee company has the meaning given by section 601RAB.
will includes a codicil and any other testamentary writing.
601RAB Meaning of trustee company and client of trustee company
(1) A trustee company is a company:
(a) that is a corporation to which paragraph 51(xx) of
the Constitution applies; and
(b) that is prescribed by the regulations as a trustee
company for the purpose of this Act.
(2) For the purpose of paragraph (1)(b), companies may (for
example) be prescribed:
(a) by setting out a list of companies in the regulations;
or
(b) by providing a mechanism in the regulations for the
determination of a list of companies.
(3) A client of a trustee company is a person to whom, within
the meaning of Chapter 7, a financial service (being a
traditional trustee company service) is provided by the trustee
company.
Note: Regulations made for the purpose of subsection 766A(1B) may prescribe the person or persons to whom a class of traditional trustee company services is taken to be provided.
601RAC Meaning of traditional trustee company services and estate
management functions
(1) The following are traditional trustee company services :
(a) performing estate management functions (see
subsection (2));

(b) preparing a will, a trust instrument, a power of
attorney or an agency arrangement;
(c) applying for probate of a will, applying for grant of
letters of administration, or electing to administer a
deceased estate;
(d) establishing and operating common funds;
(e) any other services prescribed by the regulations for
the purpose of this paragraph.
(2) The following are estate management functions (whether
provided alone or jointly with another person or persons):
(a) acting as a trustee of any kind, or otherwise
administering or managing a trust;
(b) acting as executor or administrator of a deceased
estate;
(c) acting as agent, attorney or nominee;
(d) acting as receiver, controller or custodian of
property;
(e) otherwise acting as manager or administrator
(including in the capacity as guardian) of the estate of an
individual;
(f) acting in any other capacity prescribed by the
regulations for the purpose of this paragraph.
(3) Subsections (1) and (2) do not apply to:
(a) operating a registered scheme; or
(b) providing a custodial or depository service (within
the meaning of section 766E); or
(c) acting as trustee for debenture holders under
Chapter 2L; or
(d) acting as a receiver or other controller of property of
a corporation under Part 5.2; or
(e) acting as trustee of a superannuation fund, an
approved deposit fund or a pooled superannuation trust
(within the meaning of the Superannuation Industry
(Supervision) Act 1993 ); or
(f) acting in any other capacity prescribed by the
regulations for the purpose of this paragraph.
601RAD Meaning of person with a proper interest
(1) A person with a proper interest , in relation to an estate,
includes (but is not limited to) the following:
(a) ASIC;

(b) in relation to a charitable trust:
(i) the settlor, or one of the settlors, of the trust; or
(ii) a person who, under the terms of the trust, has power
to appoint or remove a trustee of the trust or to vary
(or cause to be varied) any of the terms of the trust;
or
(iii) a Minister of a State or Territory who has
responsibilities relating to charitable trusts; or
(iv) a person who is named in the instrument establishing
the trust as a person who may receive payments on
behalf of the trust; or
(v) a person who is named in the instrument establishing
the trust as a person who must, or may, be consulted
by the trustee or trustees before distributing or
applying money or other property for the purposes
of the trust; or
(vi) a person of a class that the trust is intended to
benefit;
(c) in the case of the estate of a deceased person:
(i) if the person died testate—a beneficiary under the
person’s will; or
(ii) if the person died intestate—a person who, under a
law of a State or Territory, has, or is entitled to, an
interest in the deceased’s estate;
(d) in the case of any other trust:
(i) the settlor, or one of the settlors, of the trust; or
(ii) a person who, under the terms of the trust, has power
to appoint or remove a trustee of the trust or to vary
(or cause to be varied) any of the terms of the trust;
or
(iii) a beneficiary of the trust;
(e) in relation to an application to a court relating to the
estate—a person that the court considers, in the
circumstances of the case, has a proper interest in the
estate;
(f) a person prescribed by the regulations as having a
proper interest in the estate;
(g) if a person covered by any of the above paragraphs
is under a legal disability—an agent of the person.
(2) None of the paragraphs or subparagraphs of subsection (1)
limits, or is limited by, any of the other paragraphs or
subparagraphs of that subsection.

601RAE Interaction between trustee company provisions and State
and Territory laws
(1) The trustee company provisions are:
(a) the provisions of this Chapter, and regulations or
other instruments made for the purposes of this Chapter;
and
(b) the provisions of Chapter 7, and regulations or other
instruments made for the purposes of Chapter 7, as they
apply in relation to financial services that are traditional
trustee company services.
(2) Subject to subsections (3) and (4), the trustee company
provisions are intended to apply to the exclusion of laws of a
State or Territory of the following kinds:
(a) laws that authorise or license companies to provide
traditional trustee company services generally (as opposed
to laws that authorise or license companies to provide a
particular traditional trustee company service);
(b) laws that regulate the fees that may be charged by
companies for the provision of traditional trustee
company services, and laws that require the disclosure of
such fees;
(c) laws that deal with the provision of accounts by
companies in relation to traditional trustee company
services that they provide;
(d) laws that deal with the duties of officers or
employees of companies that provide traditional trustee
company services;
(e) laws that regulate the voting power that people may
hold in companies that provide traditional trustee
company services, or that otherwise impose restrictions on
the ownership or control of companies that provide
traditional trustee company services;
(f) laws (other than laws referred to in section 601WBC)
that deal with what happens to assets and liabilities held by
a company, in connection with the provision by the
company of traditional trustee company services, if the
company ceases to be licensed or authorised to provide
such services.
(3) Subject to subsection (4), the trustee company provisions are
not intended to apply to the exclusion of laws of a State or
Territory that require a company to have (or to have staff who
have) particular qualifications or experience if the company is

to provide traditional trustee company services of a particular
kind.
(4) The regulations may provide:
(a) that the trustee company provisions are intended to
apply to the exclusion of prescribed State or Territory
laws, or prescribed provisions of State or Territory laws;
or
(b) that the trustee company provisions are intended not
to apply to the exclusion of prescribed State or Territory
laws, or prescribed provisions of State or Territory laws.
(5) The provisions of this Chapter have effect subject to this
section.
Note: For example, section 601SAC (which provides that the powers etc. conferred by or under this Chapter are in addition to other powers etc.) is to be interpreted subject to this section.
(6) Part 1.1A does not apply in relation to the trustee company
provisions.
Part 5D.2—Powers etc. of licensed trustee
companies
Division 1—General provisions
601SAA Jurisdiction of courts not affected etc.
(1) Any inherent power or jurisdiction of courts in respect of the
supervision of the performance of traditional trustee company
services is not affected by anything in this Chapter.
(2) A licensed trustee company that is performing traditional
trustee company services of a particular kind is subject in all
respects to the same control and to removal or restraint from
acting, and generally to the jurisdiction of courts, in the same
manner as any other person who performs traditional trustee
company services of that kind.
601SAB Regulations may prescribe other powers etc.
A licensed trustee company also has, in relation to the
provision of traditional trustee company services, such other
powers, functions, liabilities and obligations, and such
privileges and immunities, as are prescribed by the regulations.

601SAC Powers etc. conferred by or under this Chapter are in
addition to other powers etc.
The powers, functions, liabilities and obligations, and the
privileges and immunities, conferred or imposed on licensed
trustee companies by or under this Chapter are in addition to,
and not in derogation of, any powers, functions, liabilities and
obligations, and any privileges and immunities, conferred or
imposed by any other law:
(a) on trustee companies; or
(b) on persons who perform estate management
functions or who provide other traditional trustee
company services.
Division 2—Accounts
601SBA Licensed trustee company not required to file accounts
(1) A licensed trustee company, when acting alone in relation to
any estate of a deceased person, is not required to file, or file
and pass, accounts relating to the estate unless the Court, of its
own motion or on application by or on behalf of a person with
a proper interest in the estate, so orders.
(2) If a licensed trustee company is appointed and acts jointly
with any other person in relation to any estate of a deceased
person, the trustee company and that other person are not
required to file, or file and pass, accounts relating to the estate
unless:
(a) that other person intends to charge fees for acting in
relation to the estate; or
(b) the Court, of its own motion or on application by or
on behalf of a person with a proper interest in the estate,
so orders.
601SBB Licensed trustee company may be required to provide
account in relation to estate
(1) On application by a person with a proper interest in an estate
that is administered or managed by a licensed trustee company,
the trustee company must provide the person with an account
of:
(a) the assets and liabilities of the estate; and
(b) the trustee company’s administration or management

of the estate; and
(c) any investment made from the estate; and
(d) any distribution made from the estate; and
(e) any other expenditure (including fees and
commissions) from the estate.
Note 1: Failure to comply with this subsection is an offence (see subsection 1311(1)).
Note 2: Failure to comply with this subsection may also lead to the consequences set out in subsection (4) of this section.
(2) If:
(a) a licensed trustee company has provided an account
to a person under this section; and
(b) the person applies for a further account within 3
months from the date on which the person was provided
with the previous account;
the trustee company need not provide a further account in
response to that application until the expiration of that period of
3 months.
Note: A defendant bears an evidential burden in relation to the matter in subsection (2), see subsection 13.3(3) of the Criminal Code .
(3) A licensed trustee company may charge a reasonable fee for
providing an account under this section.
(4) If a licensed trustee company fails to provide a proper
account under this section, the Court may, on application by the
person who sought the account or any other person with a
proper interest in the estate, make any order that the Court
considers appropriate, including an order requiring the
preparation and delivery of proper accounts.
601SBC Court may order audit
(1) The Court may, on any application under section 601SBB,
in addition to or in substitution for any account to be provided
by the licensed trustee company under that section, order that a
person named in the order must examine the accounts of the
trustee company relating to the estate in respect of which the
order is made.
(2) On the making of any such order, the trustee company must:
(a) give to the person named in the order a list of all the
accounts kept by the company relating to the estate; and
(b) produce to the person, at an office of the trustee

company at all reasonable times when required, all books
in the company’s possession relating to the estate; and
(c) provide the person with all necessary information
and all other necessary facilities for enabling the person to
make the examination.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
Division 3—Common funds
601SCA Common funds of licensed trustee companies
(1) A licensed trustee company may, for the purposes of
investment, pool together into a fund or funds money ( estate
money ) from 2 or more estates that are administered or
managed by the trustee company in the performance of estate
management functions.
(2) A fund into which money is pooled as mentioned in
subsection (1) is a common fund .
Note: A common fund may also be regulated under Chapter 5C (if the fund constitutes a managed investment scheme).
(3) A common fund may also include other money.
(4) This section has effect subject to regulations made for the
purpose of section 601SCC.
Note: For example, the regulations may limit the circumstances in which other money may be pooled together with estate money.
601SCB Obligations relating to common funds
(1) If a licensed trustee company establishes more than one
common fund, each must be allocated an appropriate
distinguishing number.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
(2) For each common fund, the licensed trustee company must
keep accounts showing at all times the current amount for the
time being at credit in the fund on account of each estate.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
(3) A licensed trustee company must not put estate money into a
common fund if doing so is contrary to an express provision of

the conditions subject to which the estate money is held by the
trustee company.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
601SCC Regulations relating to establishment or operation of
common funds
The regulations may include provisions relating to the
establishment or operation of common funds.
Part 5D.3—Regulation of fees charged by licensed
trustee companies
Division 1—Disclosure of fees
601TAA Schedule of fees to be published and available
A licensed trustee company must ensure that an up-to-date
schedule of the fees that it generally charges for the provision
of traditional trustee company services:
(a) is published at all times on a website maintained by
or on behalf of the trustee company; and
(b) is available free of charge at offices of the trustee
company during the usual opening hours of those offices.
Note 1: The schedule is of fees generally charged, and does not include fees that are agreed to etc. as mentioned in section 601TBB.
Note 2: Failure to comply with this section is an offence (see subsection 1311(1)).
601TAB Disclosure to clients of changed fees
(1) If, while a licensed trustee company continues to provide a
particular traditional trustee company service to a client or
clients, the trustee company changes the fees that it will charge
for the provision of the service, the trustee company must,
within 21 days of the change of fees taking effect, comply with
paragraph (a) or (b) in relation to the client or each client:
(a) if the client has requested to be sent copies of
changed fees—send the client a copy of the changed fees
in accordance with subsection (2); or
(b) in any other case—directly notify the client, in
writing, that the changed fees are available on the internet

on a specified website maintained by or on behalf of the
trustee company.
Note 1: Initial disclosure to a client of the fees that a trustee company will charge for the provision of a trustee company service will generally occur through the provision to the client of a Financial Services Guide under Part 7.7. However, this section is not limited just to situations where there has been an initial disclosure through a Financial Services Guide.
Note 2: Failure to comply with this subsection is an offence (see subsection 1311(1)).
(2) A copy of changed fees that is sent to a client under
paragraph (1)(a) must be:
(a) an electronic copy, if that is what the client has
requested; or
(b) a hard copy, in any other case.
(3) If a client to whom a traditional trustee company service is
provided is under a legal disability, the following provisions
have effect:
(a) a copy of changed fees required by paragraph (1)
(a), or a notice required by paragraph (1)(b), must instead
be given to an agent of the client;
(b) a request referred to in paragraph (1)(a) or (2)(a)
may instead be made by an agent of the client.
Division 2—General provisions about charging fees
601TBA Charging of fees for the provision of traditional trustee
company services
(1) Subject to this Part, a licensed trustee company may charge
fees for the provision of traditional trustee company services.
(2) If a provision of this Part limits the fees that a licensed
trustee company may charge for the provision of a particular
traditional trustee company service, the trustee company must
not charge fees for that service in excess of that limit.
Note 1: Failure to comply with this subsection is an offence (see subsection 1311(1)).
Note 2: Excess fees may also be recovered under section 601XAA.
601TBB Part does not prevent charging of fees as agreed etc.
(1) Nothing in this Part prevents a licensed trustee company

from charging:
(a) any fees that a testator, in his or her will, has directed
to be paid; or
(b) any fees that have been agreed on in accordance
with subsection (2).
(2) An agreement referred to in paragraph (1)(b) that relates to
the fees that may be charged by a licensed trustee company for
the provision of a particular traditional trustee company service
must be between the trustee company and:
(a) subject to paragraph (b) of this subsection—a person
or persons who have authority to deal with the trustee
company on matters relating to the provision of the
service; or
(b) if the regulations prescribe the person or persons
with whom the agreement must be made—that person or
those persons.
601TBC Part does not prevent charging fee for provision of account
Nothing in the Part prevents a licensed trustee company
from charging a fee permitted by subsection 601SBB(3) for the
provision of an account.
601TBD Part does not prevent reimbursement
Nothing in this Part prevents the reimbursement to a licensed
trustee company of all disbursements properly made by the
trustee company in the provision of a traditional trustee
company service.
601TBE Estate management functions: payment of fees out of estate
(1) This section applies to the performance by a licensed trustee
company of an estate management function relating to a
particular estate.
(2) Subject to subsection (3), fees charged by the trustee
company, in accordance with this Part, for the performance of
the function are payable to the trustee company out of the
capital or income of the relevant estate.
(3) However:
(a) a management fee referred to in section 601TDD can
only come out of the income of the relevant estate; and

(b) a common fund administration fee referred to in
section 601TDE or 601TDI can only come out of the
income received by the common fund on the assets of the
charitable trust concerned that are included in the fund.
Division 3—Fees otherwise than for being trustee or
manager of a charitable trust
601TCA Fees otherwise than for being the trustee or manager of a
charitable trust
(1) This section applies to a particular provision of a traditional
trustee company service by a licensed trustee company, unless:
(a) the service consists of being the trustee or manager
of a charitable trust (see Division 4); or
(b) the provision of the service started before the
commencement of this section.
(2) The trustee company must not charge fees that are in excess
of its schedule of fees that was most recently published as
required by section 601TAA before the trustee company started
to provide the service.
(3) This section does not limit anything in Division 2.
Division 4—Fees for being trustee or manager of a
charitable trust
Subdivision A—New client charitable trusts
601TDA Subdivision applies to new client charitable trusts
This Subdivision applies to a particular provision of a
traditional trustee company service by a licensed trustee
company if:
(a) the service consists of being the trustee or manager
of a charitable trust; and
(b) the provision of the service started on or after the
commencement of this section.
601TDB What the trustee company may charge
(1) For the provision of the service, the trustee company must
only charge:

(a) either:
(i) a capital commission, and an income commission, as
provided for in section 601TDC; or
(ii) a management fee as provided for in
section 601TDD; and
(b) if applicable, common fund administration fees
under section 601TDE; and
(c) if applicable, fees permitted by section 601TDF in
respect of the preparation of returns etc.
(2) This section does not limit anything in Division 2.
601TDC Option 1: capital commission and income commission
One-off capital commission
(1) The trustee company may charge a capital commission (GST
inclusive) at a rate not exceeding 5.5% of the gross value of the
charitable trust’s assets.
(2) The capital commission must be charged only once during
the period while the trustee company is trustee or manager of
the charitable trust.
(3) The regulations may make provision relating to the capital
commission, including (but not limited to):
(a) the calculation of the commission or of the gross
value of the charitable trust’s assets; and
(b) when, during the period referred to in
subsection (2), the commission may be charged.
Annual income commission
(4) The trustee company may charge an annual income
commission (GST inclusive) at a rate not exceeding 6.6% of the
income received on account of the charitable trust’s assets.
(5) The regulations may make provision relating to the income
commission, including (but not limited to):
(a) the calculation of the commission or of the income
received on the charitable trust’s assets; and
(b) when, during a year, the commission may be
charged; and
(c) apportionment of the amount of the commission for
part-years.

601TDD Option 2: annual management fee
(1) Instead of a capital commission and income commission
under section 601TDC, the trustee company may charge an
annual management fee (GST inclusive) at a rate not exceeding
1.056% of the gross value of the charitable trust’s assets.
(2) The regulations may make provision relating to the
management fee, including (but not limited to):
(a) the calculation of the management fee or of the gross
value of the charitable trust’s assets; and
(b) when, during a year, the management fee may be
charged; and
(c) apportionment of the amount of the management fee
for part-years.
601TDE Additional amount if trust money is in a common fund
(1) If any of the charitable trust’s assets are included in a
common fund operated by the trustee company, the trustee
company may charge an annual common fund administration
fee (GST inclusive) not exceeding 1.1% of the gross value of
the charitable trust’s assets in the fund.
(2) The regulations may make provision relating to the common
fund administration fee, including (but not limited to):
(a) the calculation of the common fund administration
fee or of the gross value of the charitable trust’s assets in
the fund; and
(b) when, during a year, the common fund
administration fee may be charged; and
(c) the apportionment of the common fund
administration fee for part-years.
601TDF Additional amount for preparation of returns etc.
The trustee company may charge a reasonable fee for work
involved in the preparation and lodging of returns for the
purpose of, or in connection with, assessments of any duties or
taxes (other than probate, death, succession or estate duties)
related to the trust estate of the charitable trust.
Subdivision B—Existing client charitable trusts
601TDG Subdivision applies to existing client charitable trusts

This Subdivision applies to a particular provision of a
traditional trustee company service by a licensed trustee
company if:
(a) the service consists of being the trustee or manager
of a charitable trust; and
(b) the provision of the service started before the
commencement of this section.
601TDH Trustee company not to charge more than was being
charged before section commenced
Subject to section 601TDI and 601TDJ, the trustee company
must not charge fees in excess of the fees than it could have
charged in relation to the charitable trust immediately before the
commencement of this section.
601TDI Additional amount if trust money is in a common fund
(1) If any of the charitable trust’s assets are included in a
common fund operated by the trustee company, the trustee
company may charge an annual common fund administration
fee (GST inclusive) not exceeding 1.1% of the gross value of
the charitable trust’s assets in the fund.
(2) The regulations may make provision relating to the common
fund administration fee, including (but not limited to):
(a) the calculation of the common fund administration
fee or of the gross value of the charitable trust’s assets in
the fund; and
(b) when, during a year, the common fund
administration fee may be charged; and
(c) the apportionment of the common fund
administration fee for part-years.
601TDJ Additional amount for preparation of returns etc.
The trustee company may charge a reasonable fee for work
involved in the preparation and lodging of returns for the
purpose of, or in connection with, assessments of any duties or
taxes (other than probate, death, succession or estate duties)
related to the trust estate of the charitable trust.
Division 5—Miscellaneous

601TEA Power of the Court with respect to excessive fees
(1) If the Court is of the opinion that fees charged by a licensed
trustee company in respect of any estate are excessive, the Court
may review the fees and may, on the review, reduce the fees.
(2) Subsection (1) does not apply to fees:
(a) that are charged as permitted by section 601TBB; or
(b) that relate to a charitable trust and that are charged as
permitted by Subdivision A of Division 4.
(3) In considering whether fees are excessive, the Court may
consider any or all of the following matters:
(a) the extent to which the work performed by the
trustee company was reasonably necessary;
(b) the extent to which the work likely to be performed
by the trustee company is likely to be reasonably
necessary;
(c) the period during which the work was, or is likely to
be, performed by the trustee company;
(d) the quality of the work performed, or likely to be
performed, by the trustee company;
(e) the complexity (or otherwise) of the work
performed, or likely to be performed, by the trustee
company;
(f) the extent (if any) to which the trustee company was,
or is likely to be, required to deal with extraordinary
issues;
(g) the extent (if any) to which the trustee company was,
or is likely to be, required to accept a higher level of risk
or responsibility than is usually the case;
(h) the value and nature of any property dealt with, or
likely to be dealt with, by the trustee company;
(i) if the fees are ascertained, in whole or in part, on a
time basis—the time properly taken, or likely to be
properly taken, by the trustee company in performing the
work;
(j) any other relevant matters.
(4) The Court may exercise its powers under subsection (1)
either on its own motion or on the application by or on behalf
of a person with a proper interest in the estate.
(5) If the fees are reduced by more than 10%, the trustee
company must, unless the Court in special circumstances

otherwise orders, pay the costs of the review.
(6) Subject to subsection (5), all questions of costs of the review
are in the discretion of the Court.
601TEB Directors’ fees
(1) This section applies if:
(a) an estate that is administered or managed by a
licensed trustee company has an interest in a corporation;
and
(b) an officer of the trustee company, in his or her
capacity as such an officer, acts as a director of the
corporation for purposes connected with the
administration or management of the estate.
(2) The trustee company is entitled to receive from the
corporation (and to retain) any director’s fees that would be
payable to the officer had he or she so acted otherwise than in
his or her capacity as such an officer.
(3) Neither the officer nor the estate is entitled to receive the fees
that the trustee company is entitled to receive under
subsection (2).
Part 5D.4—Duties of officers and employees of
licensed trustee companies
601UAA Duties of officers of licensed trustee company
(1) An officer of a licensed trustee company must:
(a) act honestly; and
(b) exercise the degree of care and diligence that a
reasonable person would exercise if they were in the
officer’s position; and
(c) not make use of information acquired through being
an officer of the trustee company for the purpose (or for
purposes including the purpose) of:
(i) gaining an improper advantage for the officer or
another person; or
(ii) causing detriment to the clients of the trustee
company; and
(d) not make improper use of their position as an officer

for the purpose (or for purposes including the purpose)
of:
(i) gaining, directly or indirectly, an advantage for the
officer or for any other person; or
(ii) causing detriment to the clients of the trustee
company; and
(e) take all steps that a reasonable person would take, if
they were in the officer’s position, to ensure that the
trustee company complies, in relation to the provision of
traditional trustee company services, with:
(i) this Act; and
(ii) any conditions imposed on the trustee company’s
Australian financial services licence.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
(2) A person who contravenes, or is involved in a contravention
of, subsection (1) contravenes this subsection.
Note 1: Section 79 defines involved.
Note 2: This subsection is a civil penalty provision (see section 1317E).
(3) A duty of an officer of the trustee company under
subsection (1) overrides any conflicting duty the officer has
under Part 2D.1, but is subject to any conflicting duty the
officer has under Part 5C.2.
(4) A reference in this section to the clients of a licensed trustee
company is a reference to the clients, when viewed as a group.
601UAB Duties of employees of licensed trustee company
(1) An employee of a licensed trustee company must not:
(a) make use of information acquired through being an
employee of the trustee company for the purpose (or for
purposes including the purpose) of:
(i) gaining an improper advantage for the employee or
another person; or
(ii) causing detriment to the clients of the trustee
company; or
(b) make improper use of their position as an employee
for the purpose (or for purposes including the purpose)
of:
(i) gaining, directly or indirectly, an advantage for the
employee or for any other person; or

(ii) causing detriment to the clients of the trustee
company.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
(2) A person who contravenes, or is involved in a contravention
of, subsection (1) contravenes this subsection.
Note 1: Section 79 defines involved.
Note 2: This subsection is a civil penalty provision (see section 1317E).
(3) A duty of an employee of the trustee company under
subsection (1) overrides any conflicting duty the employee has
under Part 2D.1, but is subject to any conflicting duty the
employee has under Part 5C.2.
(4) A reference in this section to the clients of a licensed trustee
company is a reference to the clients, when viewed as a group.
Part 5D.5—Limit on control of licensed trustee
companies
Division 1—15% voting power limit
601VAA Meaning of unacceptable control situation
For the purposes of this Part, an unacceptable control
situation exists in relation to a licensed trustee company and in
relation to a particular person if the person’s voting power in
the trustee company is more than:
(a) 15%; or
(b) if an approval of a higher percentage is in force
under Division 2 in relation to the trustee company and in
relation to the person—that higher percentage.
601VAB Acquisitions of shares
If:
(a) a person, or 2 or more persons under an
arrangement, acquire shares in a body corporate; and
(b) the acquisition has the result, in relation to a licensed
trustee company, that:
(i) an unacceptable control situation comes into
existence in relation to the trustee company and in

relation to a person; or
(ii) if an unacceptable control situation already exists in
relation to the trustee company and in relation to a
person—there is an increase in the voting power of
the person in the trustee company;
the person or persons mentioned in paragraph (a) contravene
this section.
Note: A contravention of this section is an offence (see subsection 1311(1)).
601VAC Remedial orders
(1) If an unacceptable control situation exists in relation to a
licensed trustee company, the Court may make such orders as
the Court considers appropriate for the purpose of ensuring that
the unacceptable control situation ceases to exist.
(2) However, the Court may only make orders under this section
on application by:
(a) the Minister; or
(b) ASIC; or
(c) the trustee company; or
(d) a person who has any voting power in the trustee
company; or
(e) a client of the trustee company.
(3) The Court’s orders may include:
(a) an order directing the disposal of shares; or
(b) an order restraining the exercise of any rights
attached to shares; or
(c) an order prohibiting or deferring the payment of any
sums due to a person in respect of shares held by the
person; or
(d) an order that any exercise of rights attached to shares
be disregarded; or
(e) an order directing any person to do or refrain from
doing a specified act, for the purpose of securing
compliance with any other order made under this section;
or
(f) an order containing such ancillary or consequential
provisions as the Court thinks just.
(4) Subsection (3) does not, by implication, limit subsection (1).
(5) Before making an order under this section, the Court may

direct that notice of the application be given to such persons as
the Court thinks fit or be published in such manner as the Court
thinks fit, or both.
(6) The Court may, by order:
(a) rescind, vary or discharge an order made by the
Court under this section; or
(b) suspend the operation of such an order.
601VAD Injunctions
(1) If any conduct (including a refusal or failure to act) amounts
or would amount to a contravention of this Part in relation to a
particular licensed trustee company, the trustee company is
taken, for the purposes of section 1324, to be a person whose
interests are affected by the conduct.
(2) Subsection (1) does not, by implication, limit the class of
persons whose interests are affected by the conduct.
(3) The Minister has the same powers as ASIC to apply for an
injunction under section 1324 in relation to a contravention of
this Part.
(4) The powers in sections 601VAC and 1324 do not, by
implication, limit each other.
Division 2—Approval to exceed 15% voting power limit
601VBA Application for approval to exceed 15% voting power limit
(1) A person may apply for approval to have voting power of
more than 15% in a particular licensed trustee company by
lodging with ASIC an application that:
(a) specifies the percentage of voting power (if any) the
person currently has in the trustee company; and
(b) specifies the percentage of voting power the person
is seeking approval to have in the trustee company; and
(c) sets out the person’s reasons for making the
application.
Note: For fees in respect of lodging applications, see Part 9.10.
(2) ASIC must give the application to the Minister as soon as
possible.

601VBB Approval of application
(1) The Minister may grant the application if the Minister is
satisfied that it would be in the interests of the licensed trustee
company and its clients for the application to be granted.
(2) If the Minister grants the application, the Minister must:
(a) give written notice of the approval to the applicant;
and
(b) specify the percentage of the voting power the
Minister approves the applicant having in the licensed
trustee company (which may or may not be the
percentage the applicant applied for); and
(c) either:
(i) specify the period during which the approval
remains in force; or
(ii) specify that the approval remains in force
indefinitely.
(3) If the Minister refuses the application, the Minister must give
written notice of the refusal to the applicant.
(4) As soon as practicable, the Minister must arrange for a copy
of a notice of approval under this section to be:
(a) published in the Gazette ; and
(b) given to the licensed trustee company concerned.
601VBC Duration of approval
(1) An approval under section 601VBB remains in force:
(a) if the notice of approval specifies a period during
which the approval remains in force—until the end of that
period, or if the Minister extends that period, until the end
of that extended period; or
(b) otherwise—indefinitely.
Extension of approval
(2) A person who holds an approval under section 601VBB that
is in force for a specified period may apply to extend that
period by lodging with ASIC an application that sets out the
person’s reasons for making the application.
Note: For fees in respect of lodging applications, see Part 9.10.
(3) ASIC must give the application to the Minister as soon as

possible.
(4) The Minister may grant the application if the Minister is
satisfied that it would be in the interests of the licensed trustee
company and its clients for the application to be granted.
(5) If the Minister grants the application, the Minister must:
(a) give written notice of the extension to the applicant;
and
(b) specify the extended period during which the
approval remains in force (which may or may not be the
period the applicant applied for).
(6) If the Minister refuses the application, the Minister must give
written notice of the refusal to the applicant.
(7) As soon as practicable, the Minister must arrange for a copy
of a notice of extension under this section to be:
(a) published in the Gazette ; and
(b) given to the licensed trustee company concerned.
601VBD Conditions of approval
(1) An approval under section 601VBB is subject to such
conditions (if any) as are specified in the notice of approval.
(2) The Minister may, by written notice given to a person who
holds an approval under section 601VBB:
(a) impose one or more conditions or further conditions
to which the approval is subject; or
(b) revoke or vary any condition:
(i) imposed under paragraph (a); or
(ii) specified in the notice of approval.
(3) The Minister’s power under subsection (2) may be
exercised:
(a) on the Minister’s own initiative; or
(b) on application by the person who holds the
approval.
(4) An application made by a person under paragraph (3)(b)
must be lodged with ASIC and must set out the person’s reasons
for making the application.
Note: For fees in respect of lodging applications, see Part 9.10.
(5) ASIC must give the application to the Minister as soon as

possible.
(6) If the Minister refuses an application under paragraph (3)
(b), the Minister must give written notice of the refusal to the
applicant.
(7) As soon as practicable, the Minister must arrange for a copy
of a notice under subsection (2) to be:
(a) published in the Gazette ; and
(b) given to the licensed trustee company concerned.
(8) A person who holds an approval under section 601VBB
must give written notice to ASIC as soon as practicable after
they become aware that they have breached a condition to
which the approval is subject.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
601VBE Varying percentage approved
Application by holder of approval
(1) A person who holds an approval under section 601VBB may
apply to vary the percentage specified in the approval by
lodging with ASIC an application that:
(a) specifies the percentage of the voting power the
person currently has in the licensed trustee company
concerned; and
(b) specifies the percentage of the voting power the
person is seeking approval to have in the trustee company;
and
(c) sets out the person’s reasons for making the
application.
Note: For fees in respect of lodging applications, see Part 9.10.
(2) ASIC must give the application to the Minister as soon as
possible.
(3) The Minister may grant the application if the Minister is
satisfied that it would be in the interests of the licensed trustee
company and its clients for the application to be granted.
(4) If the Minister grants the application, the Minister must:
(a) give written notice of the variation to the applicant;
and
(b) specify the variation granted (which may or may not

be the variation the applicant applied for).
(5) If the Minister refuses an application, the Minister must give
written notice of the refusal to the applicant.
Minister’s own initiative
(6) The Minister may, by written notice given to a person who
holds an approval under section 601VBB, vary the percentage
specified in the approval if the Minister is satisfied that the
variation would be in the interests of the licensed trustee
company and its clients.
Percentage varied upwards
(7) If the Minister varies a percentage upwards, the variation
takes effect on the day the notice of variation is given.
Percentage varied downwards
(8) If the Minister varies a percentage downwards, the variation
takes effect on the day specified in the notice of variation. The
specified day must be a day at least 90 days after the day on
which the notice is given.
Notification of variation
(9) As soon as practicable, the Minister must arrange for a copy
of a notice of variation under this section to be:
(a) published in the Gazette ; and
(b) given to the licensed trustee company concerned.
601VBF Revoking an approval
(1) The Minister may, by written notice given to a person who
holds an approval under section 601VBB in relation to a
licensed trustee company, revoke the approval if:
(a) the Minister is satisfied that it would be in the
interests of the trustee company and its clients for the
approval to be revoked; or
(b) the Minister is satisfied that an unacceptable control
situation exists in relation to the trustee company and in
relation to the person; or
(c) the Minister is satisfied that there has been a
contravention of a condition to which the approval is
subject.

(2) The revocation takes effect on the day specified in the notice
of revocation. The specified day must be a day at least 90 days
after the day on which the notice is given.
(3) If a person who holds an approval under section 601VBB
applies to the Minister for revocation of the approval, the
Minister must, by written notice given to the person, revoke the
approval. The revocation takes effect on the day specified in the
notice of revocation.
(4) As soon as practicable, the Minister must arrange for a copy
of a notice of revocation under this section to be:
(a) published in the Gazette ; and
(b) given to the licensed trustee company concerned.
601VBG Minister may require further information from applicants
(1) If a person has made an application under this Division, the
Minister may, by written notice given to the person, require the
person to give the Minister, within a specified period, further
information about the application.
(2) The Minister may refuse to consider the application until the
person gives the Minister the information.
601VBH Minister may seek views of licensed trustee company and
its clients
For the purpose of making a decision under this Division
(whether or not in response to an application) in relation to a
licensed trustee company, the Minister may seek the views of
the trustee company and its clients.
601VBI Time limit for Minister’s decision
(1) The Minister must make a decision on an application under
this Division within 30 days after receiving the application.
(2) However, before the end of the 30 days, the Minister may
decide to extend the period for considering the application until
the end of 60 days after the application was received.
(3) If the Minister has not made a decision within the 30 days
(or the 60 days, if subsection (2) applies), the Minister is taken
to have granted whatever was applied for. As soon as
practicable after that happens, the Minister must arrange for a

notice to that effect to be:
(a) published in the Gazette ; and
(b) given to the licensed trustee company concerned.
(4) The time for making the decision stops running if the
Minister gives a notice under subsection 601VBG(1) in relation
to the application, and does not start again until the notice is
complied with.
(5) The time limit in this section does not apply to an application
under section 601VBB or 601VBE if an unacceptable control
situation exists in relation to the applicant and in relation to the
relevant licensed trustee company at any time before the
Minister makes a decision.
Division 3—Other matters
601VCA Acquisition of property
(1) The Court must not make an order under section 601VAC if:
(a) the order would result in the acquisition of property
from a person otherwise than on just terms; and
(b) the order would be invalid because of paragraph 51
(xxxi) of the Constitution.
(2) Section 1350 does not apply in relation to the making of an
order under section 601VAC.
(3) In this section:
acquisition of property has the same meaning as in paragraph
51(xxxi) of the Constitution.
just terms has the same meaning as in paragraph 51(xxxi) of the
Constitution.
601VCB Interests of clients to be viewed as a group
A reference in this Part to the interests of the clients of a
licensed trustee company is a reference to the interests of the
clients, when viewed as a group.
601VCC Anti-avoidance
(1) If:
(a) one or more persons enter into, begin to carry out or

carry out a scheme; and
(b) it would be concluded that the person, or any of the
persons, who entered into, began to carry out or carried
out the scheme or any part of the scheme did so for the
sole or dominant purpose of avoiding the application of
any provision of Division 1 in relation to any person or
persons (whether or not mentioned in paragraph (a)); and
(c) as a result of the scheme or a part of the scheme, a
person (the controller ) increases the controller’s voting
power in a licensed trustee company;
the Minister may give the controller a written direction to cease
having that voting power within a specified time.
(2) A person who is subject to a direction under subsection (1)
must comply with the direction.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
(3) A direction under subsection (1) is not a legislative
instrument.
(4) In this section:
increase voting power includes increasing it from a starting
point of nil.
Part 5D.6—Consequences of cancellation of
Australian financial services licence
Division 1—Preliminary
601WAA Definitions
(1) In this Part:
asset means property, or a right, of any kind, and includes:
(a) any legal or equitable estate or interest (whether
present or future, vested or contingent, tangible or
intangible, in real or personal property) of any kind; and
(b) any chose in action; and
(c) any right, interest or claim of any kind including
rights, interests or claims in or in relation to property
(whether arising under an instrument or otherwise, and
whether liquidated or unliquidated, certain or contingent,

accrued or accruing); and
(d) any CGT asset within the meaning of the Income Tax
Assessment Act 1997 .
authorised ASIC officer , when used in a particular provision of
this Part, means a person authorised under subsection (2) to
perform or exercise the functions or powers of an authorised
ASIC officer under that provision.
cancel , in relation to a licence, means:
(a) cancel the licence under Part 7.6; or
(b) vary the conditions of the licence under Part 7.6 so
that the licence ceases to cover traditional trustee company
services.
certificate of transfer has the meaning given by subsection
601WBG(1).
compulsory transfer determination has the meaning given by
subsection 601WBA(1).
estate assets and liabilities , in relation to a trustee company that
has had its licence cancelled, means assets (including assets in
common funds) and liabilities:
(a) of an estate, or incurred in relation to an estate, in
relation to which the trustee company was (before
cancellation of its licence) performing estate management
functions; and
(b) that, immediately before the cancellation:
(i) were vested in the trustee company because it was
performing those functions; or
(ii) were otherwise assets and liabilities of the trustee
company because of its performance of those
functions.
Note: This Part does not apply to liabilities for breach of trust etc.: see section 601WBK.
interest , in relation to land, includes:
(a) a legal or equitable estate or interest in the land; or
(b) a right, power or privilege over, or in relation to, the
land.
liability includes a duty or obligation of any kind (whether
arising under an instrument or otherwise, and whether actual,
contingent or prospective).

licence means an Australian financial services licence that is
held by a trustee company and that covers the provision of one
or more traditional trustee company services.
receiving company has the meaning given by subsection
601WBA(1).
transferring company has the meaning given by subsection
601WBA(1).
(2) ASIC may, in writing, authorise a person who is a member
of ASIC, or of its staff, to perform or exercise the functions or
powers of an authorised ASIC officer under a particular
provision of this Part.
Division 2—Transfer of estate assets and liabilities
601WBA Compulsory transfer determinations
(1) If ASIC cancels the licence of a trustee company (the
transferring company ), ASIC may, in writing, make a
determination (a compulsory transfer determination ) that there
is to be a transfer of estate assets and liabilities from the
transferring company to another licensed trustee company (the
receiving company ).
(2) ASIC may make a compulsory transfer determination only
if:
(a) either:
(i) the Minister has consented to the transfer; or
(ii) the Minister’s consent to the transfer is not required
(see section 601WBD); and
(b) ASIC is satisfied that:
(i) the transfer is in the interests of clients of the
transferring company (when viewed as a group); and
(ii) the transfer is in the interests of clients of the
receiving company (when viewed as a group); and
(iii) the board of the receiving company has consented to
the transfer; and
(iv) legislation to facilitate the transfer that satisfies the
requirements of section 601WBC has been enacted in
the State or Territory in which the transferring
company is registered and the State or Territory in
which the receiving company is registered.

(3) The determination must include particulars of the transfer,
including:
(a) the names of the transferring company and the
receiving company; and
(b) whether it will be a total transfer or a partial transfer
of the transferring company’s estate assets and liabilities;
and
(c) if it will be a partial transfer—an indication of the
part of the transferring company’s estate assets and
liabilities that is to be transferred.
(4) The determination must include a statement of the reasons
why the determination has been made.
(5) The determination is not a legislative instrument.
601WBB When consent of receiving company is in force
(1) The consent referred to in subparagraph 601WBA(2)(b)(iii)
remains in force until it is withdrawn by the receiving
company’s board with the agreement of ASIC.
(2) ASIC may agree to the consent being withdrawn if ASIC
considers it appropriate to allow the consent to be withdrawn
having regard to any of the following:
(a) circumstances that have arisen since the consent was
given;
(b) circumstances that were in existence at or before the
time when the consent was given but that were not known
to the receiving company’s board when it gave its
consent;
(c) any other relevant matter.
601WBC Complementary State or Territory legislation
State or Territory legislation referred to in subparagraph
601WBA(2)(b)(iv) must include provision to ensure that, when
a certificate of transfer comes into force under this Division, the
receiving company is taken to be the successor in law in relation
to estate assets and liabilities of the transferring company, to the
extent of the transfer. In particular, the legislation must provide
that:
(a) assets of the transferring company become assets of
the receiving company, to the extent of the transfer; and
(b) liabilities of the transferring company become

liabilities of the receiving company, to the extent of the
transfer; and
(c) the duties, obligations, immunities, rights and
privileges applying to the transferring company apply to
the receiving company, to the extent of the transfer; and
(d) if the certificate of transfer includes provisions of a
kind referred to in subsection 601WBG(3) specifying:
(i) that particular things are to happen or are taken to be
the case—those things are taken to happen, or to be
the case, in accordance with those provisions; or
(ii) a mechanism for determining things that are to
happen or are taken to be the case—things
determined in accordance with that mechanism are
taken to happen, or to be the case, as determined in
accordance with that mechanism.
601WBD Minister’s power to decide that his or her consent is not
required
(1) The Minister’s consent to the transfer of estate assets and
liabilities is not required if the Minister has, in writing,
determined that his or her consent is not required in relation to:
(a) the transfer; or
(b) a class of transfers that includes the transfer.
(2) The regulations may prescribe criteria to be taken into
account by the Minister in deciding whether to make a
determination.
(3) A determination is a legislative instrument if it is expressed
to apply in relation to a class of transfers (whether or not it is
also expressed to apply in relation to one or more transfers
identified otherwise than by reference to membership of a
class).
(4) If subsection (3) does not apply to a determination, the
determination is not a legislative instrument.
601WBE Determinations may impose conditions
(1) The compulsory transfer determination may impose
conditions of either or both of the following kinds:
(a) conditions to be complied with by the transferring
company or the receiving company before a certificate of
transfer is issued in relation to the transfer of estate assets

and liabilities;
(b) conditions to be complied with by the transferring
company or the receiving company after a certificate of
transfer has been issued or has come into force in relation
to the transfer of estate assets and liabilities.
(2) ASIC may, by notice in writing given to the transferring
company or the receiving company, vary or revoke any
condition of a determination if ASIC is satisfied that the
variation or revocation is appropriate.
(3) The transferring company or the receiving company may
apply in writing to ASIC to have a condition of a kind referred
in paragraph (1)(b) that applies to it varied or revoked.
(4) ASIC may, by notice in writing given to the company that
made the application, approve the variation or revocation if
ASIC is satisfied that the variation or revocation is appropriate.
A variation or revocation that is approved by ASIC has effect
accordingly.
(5) The transferring company or the receiving company must
comply with any conditions that are imposed under
subsection (1) as conditions to be complied with by that
company.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
(6) The transferring company or the receiving company does
not commit an offence against this Act merely because the
company is complying with a condition imposed under
subsection (1).
Note: A defendant bears an evidential burden in relation to the matter in subsection (6), see subsection 13.3(3) of the Criminal Code .
601WBF Notice of determination
ASIC must give a copy of the compulsory transfer
determination to the transferring company and the receiving
company.
601WBG Certificate of transfer
(1) If:
(a) ASIC has made a compulsory transfer determination;
and

(b) ASIC considers that the transfer should go ahead;
and
(c) the consent referred to in subparagraph 601WBA(2)
(b)(iii) has not been withdrawn under section 601WBB;
ASIC must, in writing, issue a certificate (a certificate of
transfer ) stating that the transfer is to take effect.
(2) The certificate of transfer must:
(a) include the names of the transferring company and
the receiving company; and
(b) state whether the transfer is a total transfer or a
partial transfer; and
(c) if the transfer is a partial transfer—include, or have
attached to it, a list of the estate assets and liabilities that
are being transferred to the receiving company; and
(d) state when the certificate is to come into force (either
by specifying a date as the date it comes into force, or by
specifying that the date it comes into force is a date
worked out in accordance with provisions of the
certificate).
(3) The certificate may include provisions specifying, or
specifying a mechanism for determining, other things that are to
happen, or that are taken to be the case, in relation to assets and
liabilities that are to be transferred, or in relation to the transfer
of estate assets and liabilities that is to be effected, whether the
transfer is total or partial.
(4) The certificate comes into force in accordance with the
statement included in the certificate as required by
paragraph (2)(d).
(5) The certificate is not a legislative instrument.
601WBH Notice of certificate
ASIC must:
(a) give a copy of the certificate of transfer to the
transferring company and the receiving company; and
(b) publish notice of the issue of the certificate.
601WBI Time and effect of compulsory transfer
(1) When a certificate of transfer comes into force, the receiving
company becomes the successor in law of the transferring

company in relation to estate assets and liabilities of the
transferring company, to the extent of the transfer. In particular:
(a) if the transfer is a total transfer—all the estate assets
and liabilities of the transferring company, wherever those
assets and liabilities are located, become assets and
liabilities of the receiving company (in the same capacity
as they were assets and liabilities of the transferring
company) without any transfer, conveyance or
assignment; and
(b) if the transfer is a partial transfer—all the estate assets
and liabilities included in the list referred to in paragraph
601WBG(2)(c), wherever those assets and liabilities are
located, become assets and liabilities of the receiving
company (in the same capacity as they were assets and
liabilities of the transferring company) without any
transfer, conveyance or assignment; and
(c) to the extent of the transfer, the duties, obligations,
immunities, rights and privileges applying to the
transferring company apply to the receiving company.
(2) If the certificate includes provisions of a kind referred to in
subsection 601WBG(3):
(a) if the provisions specify that particular things are to
happen or are taken to be the case—those things are, by
force of this section, taken to happen, or to be the case, in
accordance with those provisions; and
(b) if the provisions specify a mechanism for
determining things that are to happen or are taken to be
the case—things determined in accordance with the
mechanism are, by force of this section, taken to happen,
or to be the case, as determined in accordance with that
mechanism.
601WBJ Substitution of trustee company
When a certificate of transfer comes into force, any
appointment or nomination of the transferring company to a
particular capacity (for example, as trustee, executor or
administrator) in relation to the transferred estate assets and
liabilities is taken to be an appointment or nomination of the
receiving company to that capacity in relation to those assets
and liabilities.
601WBK Liabilities for breach of trust and other matters not
affected by this Part

(1) Nothing in this Part applies to or affects liabilities of the
transferring company, or of an officer or employee of the
transferring company, for:
(a) any breach of trust; or
(b) any other misfeasance or nonfeasance; or
(c) any exercise of, or failure to exercise, any discretion.
(2) Nothing in this Part affects any rights of the transferring
company, or of an officer or employee of the transferring
company, to indemnity in respect of such liabilities.
Division 3—Other matters related to the transfer of estate
assets and liabilities
601WCA Certificates evidencing operation of Act etc.
(1) An authorised ASIC officer, by signed writing, may certify
that a specified asset or liability has become an asset or liability
of the receiving company under this Part.
(2) For all purposes and in all proceedings, a certificate under
subsection (1) is prima facie evidence of the matters certified.
601WCB Certificates in relation to land and interests in land
If:
(a) the receiving company becomes, under this Part, the
owner of land, or of an interest in land, that is situated in a
State or Territory; and
(b) there is lodged with the Registrar of Titles or other
appropriate officer of the State or Territory in which the
land is situated a certificate that:
(i) is signed by an authorised ASIC officer; and
(ii) identifies the land or interest; and
(iii) states that the receiving company has, under this
Part, become the owner of that land or interest;
the officer with whom the certificate is lodged may:
(c) register the matter in the same manner as dealings in
land or interests in land of that kind are registered; and
(d) deal with, and give effect to, the certificate.
601WCC Certificates in relation to other assets
(1) If:

(a) an asset (other than land or an interest in land)
becomes, under this Part, an asset of the receiving
company; and
(b) there is lodged with the person or authority who has,
under a law of the Commonwealth, a State or a Territory,
responsibility for keeping a register in respect of assets of
that kind a certificate that:
(i) is signed by an authorised ASIC officer; and
(ii) identifies the asset; and
(iii) states that the asset has, under this Part, become an
asset of the receiving company;
that person or authority may:
(c) register the matter in the same manner as transactions
in relation to assets of that kind are registered; and
(d) deal with, and give effect to, the certificate.
(2) This section does not affect the operation of:
(a) other provisions of this Act; or
(b) if the regulations prescribe provisions of one or
more other Acts—those provisions of those Acts.
601WCD Documents purporting to be certificates
A document purporting to be a certificate given under this
Division is, unless the contrary is established, taken to be such a
certificate and to have been properly given.
601WCE Construction of references to transferring company
From when a certificate of transfer comes into force, in any
instrument of any kind, a reference to the transferring
company, in relation to assets or liabilities transferred under this
Part, is taken to be a reference to the receiving company.
601WCF Income or other distribution received by transferring
company
The transferring company must promptly account to the
receiving company for any income or other distribution
received by the transferring company after a certificate of
transfer comes into force, if the income or distribution arises
from assets transferred to the receiving company under this
Part.
Note: Failure to comply with this section is an offence (see subsection

1311(1)).
601WCG Access to books
The transferring company must, at the request of the
receiving company, give the receiving company access to all
books in its possession that relate to assets or liabilities
transferred under this Part.
Note: Failure to comply with this section is an offence (see subsection 1311(1)).
601WCH Minister or ASIC may seek views of trustee company and
its clients
For the purpose of deciding whether to exercise powers
under this Part, the Minister or ASIC may seek the views of a
trustee company or its clients in relation to the possible exercise
of the powers.
Division 4—Miscellaneous
601WDA Transferring company required to contact certain persons
(1) If the licence of a trustee company is cancelled, the trustee
company must, as soon as practicable:
(a) take all reasonable steps to contact the following
persons and advise them of the cancellation of the licence:
(i) all persons who the trustee company is aware have
executed and lodged instruments, such as wills, that
have not yet come into effect, but will potentially
lead to estate assets and liabilities being held by the
trustee company;
(ii) all persons who the trustee company is aware have
appointed the trustee company as trustee or to some
other capacity; and
(b) publish notice of the cancellation of the licence.
Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).
(2) If a certificate of transfer comes into force, the trustee
company must, as soon as practicable, take all reasonable steps
to contact the persons referred to in subsection (1) and advise
them of the transfer of estate assets and liabilities.
Note: Failure to comply with this subsection is an offence (see

subsection 1311(1)).
Part 5D.7—Effect of contraventions
601XAA Civil liability of licensed trustee companies
(1) A person who suffers loss or damage because of conduct of
a licensed trustee company that contravenes a provision of this
Chapter may recover the amount of the loss or damage by
action against the trustee company, whether or not the trustee
company has been convicted of an offence, or has had a civil
penalty order made against it, in respect of the contravention.
(2) Without limiting subsection (1), if:
(a) a licensed trustee company charges a person a fee in
excess of fees permitted to be charged by this Chapter;
and
(b) the person pays the fee;
the amount of the excess is a loss that is recoverable by the
person under subsection (1).
(3) An action under subsection (1) must be begun within 6 years
after the cause of action arises.
(4) This section does not affect any liability that a person has
under other provisions of this Act or under other laws.
Part 5D.8—Exemptions and modifications
601YAA Exemptions and modifications by ASIC
(1) ASIC may:
(a) exempt a person or class of persons, or an estate or
class of estates, from all or specified provisions of this
Chapter; or
(b) declare that this Chapter applies to a person or class
of persons, or an estate or class of estates, as if specified
provisions were omitted, modified or varied as specified
in the declaration.
(2) An exemption may apply unconditionally or subject to
specified conditions. A person to whom a condition specified in
an exemption applies must comply with the condition. The

Court may order the person to comply with the condition in a
specified way. Only ASIC may apply to the Court for the order.
(3) An exemption or declaration is a legislative instrument if it is
expressed to apply in relation to a class of persons or a class of
estates (whether or not it is also expressed to apply in relation to
one or more persons or estates identified otherwise than by
reference to membership of a class).
(4) If subsection (3) does not apply to an exemption or
declaration, the exemption or declaration must be in writing and
ASIC must publish notice of it in the Gazette . The exemption or
determination is not a legislative instrument.
(5) If conduct (including an omission) of a person would not
have constituted an offence if a particular declaration under
paragraph (1)(b) had not been made, that conduct does not
constitute an offence unless, before the conduct occurred (in
addition to complying with the requirements of the Legislative
Instruments Act 2003 (if the declaration is of a kind referred to
in subsection (3)), or with the gazettal requirement of
subsection (4), as the case may be):
(a) the text of the declaration was made available by
ASIC on the internet; or
(b) ASIC gave written notice setting out the text of the
declaration to the person.
In a prosecution for an offence to which this subsection applies,
the prosecution must prove that paragraph (a) or (b) was
complied with before the conduct occurred.
(6) For the purpose of this section, the provisions of this Chapter
include:
(a) regulations or other instruments made for the
purposes of this Chapter; and
(b) definitions in this Act or the regulations, as they
apply to references in:
(i) this Chapter; or
(ii) regulations or other instruments made for the
purposes of this Chapter; and
(c) any provisions of Division 2 of Part 10.12 that relate
to this Chapter.
601YAB Exemptions and modifications by regulations
(1) The regulations may:

(a) exempt a person or class of persons, or an estate or
class of estates, from all or specified provisions of this
Chapter; or
(b) provide that this Chapter applies to a person or class
of persons, or an estate or class of estates, as if specified
provisions were omitted, modified or varied as specified
in the declaration.
(2) For the purpose of this section, the provisions of this Chapter
include:
(a) regulations or other instruments made for the
purposes of this Chapter; and
(b) definitions in this Act or the regulations, as they
apply to references in:
(i) this Chapter; or
(ii) regulations or other instruments made for the
purposes of this Chapter; and
(c) any provisions of Division 2 of Part 10.12 that relate
to this Chapter.
10 Section 761A (paragraph (a) of the definition of financial
services law )
After “5C,”, insert “5D,”.
11 Section 761A (at the end of the definition of financial
services law )
Add:
; or (e) in relation to a financial services licensee that is a
licensed trustee company (in addition to paragraphs (a) to
(d))—any rule of common law or equity that covers
conduct relating to the provision of financial services that
are traditional trustee company services (whether or not it
also covers other conduct), but only in so far as it covers
conduct relating to the provision of such services.
12 Section 761A
Insert:
licensed trustee company has the same meaning as in
Chapter 5D.
13 Section 761A
Insert:

traditional trustee company services has the same meaning as in
Chapter 5D.
14 Section 761A
Insert:
trustee company has the same meaning as in Chapter 5D.
15 Subsection 761G(1)
After “(6)”, insert “, (6A)”.
16 After subsection 761G(6)
Insert:
Traditional trustee company services
(6A) For the purpose of this Chapter, if a financial service
provided to a person is a traditional trustee company service,
the service is provided to the person as a retail client unless
regulations made for the purpose of this subsection provide
otherwise.
17 Subsection 761G(7)
After “a financial service”, insert “(other than a traditional trustee
company service)”.
18 Section 761GA
After “a financial service”, insert “(other than a traditional trustee
company service)”.
19 After subsection 766A(1)
Insert:
Provision of traditional trustee company services by trustee
company
(1A) Subject to paragraph (2)(b), the provision by a trustee
company of a traditional trustee company service constitutes the
provision, by the company, of a financial service .
Note: Trustee companies may also provide other kinds of financial service mentioned in subsection (1).
(1B) The regulations may, in relation to a traditional trustee
company service of a particular class, prescribe the person or

persons to whom a service of that class is taken to be provided.
This subsection does not limit (and is not limited by)
subsection (2).
Note: A traditional trustee company service is provided to a person as a retail client unless regulations provide otherwise (see subsection 761G(6A)).
Note 1: The following heading to subsection 766A(1) is inserted “ General ”.
Note 2: The following heading to subsection 766A(2) is inserted “ Regulations may deal with various matters ”.
Note 3: The following heading to subsection 766A(3) is inserted “ Exception for work ordinarily done by clerks or cashiers ”.
Note 4: The following heading to subsection 766A(4) is inserted “ Meaning of operating a registered scheme ”.
20 Subsection 911A(4)
Omit all the words from and including “if the service is”, substitute:
if the service is:
(a) the operation of a registered scheme; or
(b) a traditional trustee company service.
21 Subparagraph 912D(1)(a)(iii)
Before “the obligation”, insert “in relation to financial services, other
than traditional trustee company services provided by a licensed
trustee company—”.
22 Subparagraph 912D(1)(a)(iii)
Omit “and” (last occurring), substitute “or”.
23 At the end of paragraph 912D(1)(a)
Add:
(iv) in relation to traditional trustee company services
provided by a licensed trustee company—the
obligation under paragraph 912A(1)(c), so far as it
relates to Commonwealth, State or Territory
legislation, or a rule of common law or equity, that is
covered by paragraph (d) or (e) of that definition;
and
24 After paragraph 915B(3)(c)
Insert:
(ca) is a trustee company whose clients have suffered, or
are likely to suffer, loss or damage because the company

has breached:
(i) this Act; or
(ii) a financial services law referred to in paragraph (e)
of the definition of financial services law in
section 761A; or
25 After paragraph 981A(2)(c)
Insert:
(ca) the licensee is a licensed trustee company, and the
money is paid to the licensee in connection with
traditional trustee company services provided by the
licensee; or
26 After paragraph 1311(1A)(d)
Insert:
(daa) Chapter 5D;
27 After paragraph 1317E(1)(j)
Insert:
(jaaa) subsection 601UAA(2) (duties of officers of licensed
trustee company);
(jaab) subsection 601UAB(2) (duties of employees of
licensed trustee company);
28 Schedule 3 (after table item 173)
Insert:
173A Subsection 601SBB(1) 50 penalty units.
173B Subsection 601SBC(2) 50 penalty units.
173C Subsection 601SCB(1) 50 penalty units.
173D Subsection 601SCB(2) 50 penalty units.
173E Subsection 601SCB(3) 60 penalty units or imprisonment for 12
months, or both.
173F Section 601TAA 60 penalty units or imprisonment for 12
months, or both.
173G Subsection 601TAB(1) 60 penalty units or imprisonment for 12
months, or both.
173H Subsection 601TBA(2) 60 penalty units or imprisonment for 12
months, or both.
173J Subsection 601UAA
(1)
300 penalty units or imprisonment for 5
years, or both.

173K Subsection 601UAB
(1)
300 penalty units or imprisonment for 5
years, or both.
173L Section 601VAB 120 penalty units or imprisonment for 2
years, or both.
173M Subsection 601VBD
(8)
60 penalty units or imprisonment for 12
months, or both.
173N Subsection 601VCC
(2)
120 penalty units or imprisonment for 2
years, or both.
173P Subsection 601WBE
(5)
50 penalty units.
173Q Section 601WCF 60 penalty units, or imprisonment for 12
months, or both.
173R Section 601WCG 60 penalty units, or imprisonment for 12
months, or both.
173S subsection 601WDA
(1)
120 penalty units or imprisonment for 2
years, or both.
173T subsection 601WDA
(2)
120 penalty units or imprisonment for 2
years, or both.

Schedule 3—Debentures
Corporations Act 2001
1 Section 9 (paragraph (d) of the definition of debenture )
Repeal the paragraph.
2 Section 283BC
Repeal the section, substitute:
283BC Duty to notify ASIC of information related to trustee
(1) Within 14 days after the trustee is appointed, the borrower
must lodge with ASIC a notice containing the following
information:
(a) the name of the trustee;
(b) any other information related to the trustee or the
debentures that is prescribed by the regulations.
(2) If there is any change to the information, the borrower must,
within 14 days of the change, lodge with ASIC a notice
containing the changed information.
(3) A notice under subsection (1) or (2) must be in the
prescribed form.
3 After section 283BC
Insert:
283BCA Register relating to trustees for debenture holders
The register
(1) ASIC must establish and maintain a register relating to
trustees for debenture holders.
(2) The regulations may prescribe the way in which the register
must be established or maintained, including the details that
ASIC must enter in the register.
Inspection of register
(3) A person may inspect the register, and may make copies of,

or take extracts from, the register.
(4) The regulations may prescribe the fees that a person must
pay ASIC to do the things mentioned in subsection (3).
(5) Any disclosure necessary for the purposes of this section is
authorised by this section.

Schedule 4—Technical amendment
Corporations Act 2001
1 Subsection 1338B(8)
After “of a State”, insert “, the Capital Territory”.

Schedule 5—Application and transitional
provisions
Corporations Act 2001
1 At the end of Chapter 10
Add:
Part 10.12—Transitional provisions relating to the
Corporations Legislation Amendment
(Financial Services Modernisation) Act
2009
Division 1—Transitional provisions relating to Schedule 1
to the Corporations Legislation Amendment
(Financial Services Modernisation) Act 2009
1487 Definitions
(1) In this Division:
amended Corporations Act means this Act as in force after
commencement.
amending Schedule means Schedule 1 to the Corporations
Legislation Amendment (Financial Services Modernisation) Act
2009 .
commencement means the day on which the amending
Schedule commences.
margin lending financial service has the meaning given by
subsection 1488(2).
(2) Terms that are used in this Division and that are defined in
Division 2 of Part 7.1 have the same meanings as they are given
by that Division.
1488 Application of amendments—general

(1) The amendments made by the amending Schedule apply in
relation to a margin lending financial service that is provided on
or after the day that is 12 months after commencement.
(2) A margin lending financial service is:
(a) a dealing in a margin lending facility that was issued
after commencement; or
(b) the provision of financial product advice in relation
to a margin lending facility that was issued after
commencement.
1489 Applications of amendments—application for and grant of
licences etc. authorising margin lending financial services
(1) Despite section 1488, during the period that:
(a) starts at the start of the day that is one month after
commencement; and
(b) ends at the end of the day before the day that is 12
months after commencement;
subsections (2) and (3) apply.
(2) A person may:
(a) apply under section 913A of the amended
Corporations Act for an Australian financial services
licence that authorises the person to provide a margin
lending financial service; and
(b) apply under section 914A of the amended
Corporations Act for a variation of a condition of an
Australian financial services licence to authorise the
person to provide a margin lending financial service.
(3) ASIC may:
(a) grant an Australian financial services licence to a
person under section 913B of the amended Corporations
Act that authorises the person to provide a margin lending
financial service, and otherwise deal with that licence (for
example, by suspending or cancelling it) under Chapter 7;
and
(b) impose or vary conditions on an Australian financial
services licence under section 914A of the amended
Corporations Act to authorise a person to provide a
margin lending financial service, and otherwise deal with
those conditions (for example, by revoking or varying
them) under Chapter 7;
but the Australian financial services licence, condition, or

variation of a condition, does not take effect until the day that is
12 months after commencement.
1490 Application of amendments—between 6 and 12 months after
commencement
(1) Despite section 1488, the amendments made by the
amending Schedule apply in relation to a margin lending
financial service that is provided during the period that:
(a) starts at the start of the day that is 6 months after
commencement; and
(b) ends at the end of the day before the day that is 12
months after commencement;
but only if, at the time the margin lending financial service is
provided, subsection (2) or (3) applies to:
(c) the person who provides the margin lending
financial service; and
(d) if the margin lending financial service is provided on
behalf of another person—the person on whose behalf the
margin lending financial service is provided.
(2) This subsection applies to a person if the person is an
Australian financial services licensee and either:
(a) has not applied for a condition of the licence to be
varied to authorise the person to provide the margin
lending financial service; or
(b) has applied for a condition of the licence to be
varied to authorise the person to provide the margin
lending financial service, but has been notified by ASIC
that the application has been refused.
(3) This subsection applies to a person if the person is not an
Australian financial services licensee and either:
(a) has not applied for an Australian financial services
licence that authorises the person to provide the margin
lending financial service; or
(b) has applied for an Australian financial services
licence that authorises the person to provide the margin
lending financial service, but has been notified by ASIC
that the application has been refused.
1491 Acquisition of property
(1) Despite section 1350, a provision of this Division does not

apply, and is taken never to have applied, to the extent that the
operation of the provision would result in an acquisition of
property from a person otherwise than on just terms.
(2) In subsection (1), acquisition of property and just terms have
the same meanings as in paragraph 51(xxxi) of the Constitution.
1492 Regulations
(1) The regulations may make provisions of a transitional,
application or saving nature relating to this Division and the
amendments and repeals made by the amending Schedule.
(2) Without limiting subsection (1), regulations made for the
purpose of that subsection may modify provisions of this Act.
Division 2—Transitional provisions relating to Schedule 2
to the Corporations Legislation Amendment
(Financial Services Modernisation) Act 2009
1493 Definitions
In this Division:
amending Schedule means Schedule 2 to the Corporations
Legislation Amendment (Financial Services Modernisation) Act
2009 .
commencement means the commencement of the amending
Schedule.
modify includes make additions, omissions and substitutions.
1494 Transitional provisions relating to limit on control of trustee
companies
(1) This section applies in relation to a person and a trustee
company if, immediately before the commencement of Part 5D.
5, the percentage (the pre-commencement percentage ) of the
person’s voting power in the trustee company exceeded 15%.
(2) Subject to subsection (3), Part 5D.5 applies in relation to the
person and the trustee company as if paragraph 601VAA(a)
specified the pre-commencement percentage (rather than 15%).
(3) If, after the commencement of Part 5D.5, the percentage of

the person’s voting power in the trustee company is reduced,
the following provisions have effect from the time of the
reduction:
(a) if the reduced percentage exceeds 15%—Part 5D.5
applies in relation to the person and the trustee company
as if paragraph 601VAA(a) specified the reduced
percentage (rather than 15%);
(b) if the reduced percentage is 15% or less—this section
ceases to apply, and never again applies, in relation to the
person and the trustee company.
1495 Transitional provisions relating to the amendments of
Chapter 7
(1) This section applies to each company:
(a) that is a trustee company immediately after the
commencement of the first regulations made for the
purpose of paragraph 601RAB(1)(b); and
(b) that, at that time, holds an Australian financial
services licence.
(2) During the period of 6 months starting on the
commencement of those regulations:
(a) the company’s Australian financial services licence is
taken to cover the provision by the company of traditional
trustee company services; and
(b) section 601TAB does not apply in relation to the
company; and
(c) Part 7.7 does not apply in relation to traditional
trustee company services provided by the company.
Note: If the company wants to continue to provide traditional trustee company services after the end of the 6 month period, it will (before the end of that period) need to apply to ASIC to have the conditions of its licence varied to cover those services.
(3) To avoid doubt, subsection (2) does not limit ASIC’s powers
under Part 7.6 (whether during or after the period of 6 months)
in relation to the company’s Australian financial services
licence.
Note: For example, ASIC may (under Subdivision B of Division 4 of Part 7.6) impose or vary licence conditions, or may (under Subdivision C of Division 4 of Part 7.6) vary, cancel or suspend the licence.
1496 General power for regulations to deal with transitional matters

(1) The regulations may make provisions of a transitional,
application or saving nature in relation to any of the following:
(a) the transition from the regime provided for by laws
of the States and Territories (as in force before
commencement) relating to trustee companies to the
regime provided for by this Act as amended by the
amending Schedule;
(b) the amendments and repeals made to this Act by the
amending Schedule.
(2) Without limiting subsection (1), regulations made for the
purpose of that subsection may modify provisions of this Act.
Division 3—Transitional provisions relating to Schedule 3
to the Corporations Legislation Amendment
(Financial Services Modernisation) Act 2009
1497 Definitions
In this Division:
amending Schedule means Schedule 3 to the Corporations
Legislation Amendment (Financial Services Modernisation) Act
2009 .
1498 Application of amendments
(1) The amendment made by item 1 of the amending Schedule
applies to promissory notes made after the commencement of
that item.
(2) The amendment made by item 2 of the amending Schedule
applies to trustees appointed on or after the commencement of
that item.
[Minister’s second reading speech made in—
House of Representatives on 25 June 2009
Senate on 26 October 2009 ] (145/09)