Document ID: chunk:federal_register_of_legislation:C2025C00134:section:117:p1
Version: federal_register_of_legislation:C2025C00134
Segment Type: section
Provision Reference: s 117 (pt 1/3)
Character Range: 593602–596419

117  Circumstances in which amounts may be paid out of an employer‑sponsored fund to an employer‑sponsor

Excluded superannuation funds
 (2) This section does not apply to an excluded superannuation fund during the period:
 (a) beginning on 21 October 1992; and
 (b) ending immediately before the day on which subsection (2A) commenced.

Self managed superannuation funds
 (2A) This section does not apply to a self managed superannuation fund if, at all times after the day on which this subsection commenced when the fund was in existence, the fund was a self managed superannuation fund.

Basic prohibition
 (3) Except as provided by this section, a trustee of a standard employer‑sponsored fund must not pay an amount, or permit an amount to be paid, out of the fund to a standard employer‑sponsor.
 (3A) Subsection (3) does not apply in circumstances where:
 (a) its application would result in the acquisition of property from a person otherwise than on just terms; and
 (b) the acquisition would be invalid because of paragraph 51(xxxi) of the Constitution.

Exception—management services
 (4) A reasonable amount may be paid out of any standard employer‑sponsored fund to a standard employer‑sponsor for services rendered in connection with the management or operation of the fund.

Exception—special procedures followed
 (5) An amount may be paid out of a standard employer‑sponsored fund to a standard employer‑sponsor if the following requirements are fulfilled:
 (a) apart from this section, the governing rules would require or permit the amount to be paid to the employer‑sponsor;
 (b) whichever of the following subparagraphs is applicable has been complied with:
 (i) if the fund has a single corporate trustee:
 (A) the directors of the trustee have, by resolution, declared their intention to pay the amount out of the fund to the employer‑sponsor; and
 (B) when that resolution was passed, the board of the corporate trustee complied with the basic equal representation rules under Part 9;
 (ii) if the fund has a group of individual trustees:
 (A) the trustees have, by resolution, declared their intention to pay the amount out of the fund to the employer‑sponsor; and
 (B) when that resolution was passed, the group of trustees complied with the basic equal representation rules under Part 9;
 (iii) in any other case—the trustee has declared his or her intention to pay the amount out of the fund to the employer‑sponsor;
 (c) before the resolution referred to in subparagraph (b)(i) or (ii), was passed or before the declaration referred to in subparagraph (b)(iii) was made:
 (i) an actuary had given a written certificate to the trustee, or the trustees, of the fund stating that, if the amount were paid, the fund would remain in a satisfactory financial position; and
 (ii) the trustee, or