Document ID: chunk:federal_register_of_legislation:F2024L00374:body:0:p10
Version: federal_register_of_legislation:F2024L00374
Segment Type: other
Provision Reference: 
Character Range: 23046–25920

other encumbrance in favour of the custodian or its associates unless the responsible entity reasonably believes for reasons it has recorded in writing that any conflict that may arise as a result of the security interest, mortgage, lien or encumbrance will not materially increase the risks that the custodian will fail to meet its obligations and the responsible entity must keep the written record of reasons for 7 years after the security interest, mortgage, lien or encumbrance has ceased.
(5) The responsible entity must ensure that no agreement it has with a custodian contains any provision that would require the custodian to disclose to the responsible entity or another person that it has communicated with ASIC concerning a suspicion of contravention of a financial services law or that it is considering doing so.
(6) A responsible entity that complies with this section in relation to an arrangement with a custodian is taken to comply with any condition on its Australian financial services licence concerning the arrangement.".

Part 3—Exemption

5 Omnibus accounts
          (1)  A responsible entity does not have to comply with subparagraph 601FC(1)(i)(ii) of the Act for scheme property that comprises:
             (a) Australian or foreign currency; or
             (b) a deposit taking facility of a body carrying on a business of accepting money on deposit including rights under that facility; or
             (c) securities; or
             (d) derivatives.

      Conditions
           (2) A responsible entity that relies on the exemption in subsection 5(1) must do all of the following:
              (a) put in place and keep for 7 years after it was last relied on, a written policy in relation to not holding scheme property separately in reliance on the exemption which sets out its reasons why that policy is appropriate having regard to any extent to which it might expose its members of the scheme to the risks arising from the property not being held separately or there is reason to believe that applying the policy might not be in the best interests of the members;
              (b) ensure that the policy is reviewed at least every 13 months, prepare a written record of the outcome of the review and keep that record for 7 years;
              (c) do all things necessary to ensure that adequate records are kept at all times showing the scheme's entitlement to property that includes the scheme property not held separately;
              (d) do all things necessary to ensure reconciliation procedures are performed on each business day in relation to the scheme property not held separately or if because of the nature of the property, it is ordinary and reasonable commercial practice to reconcile property of that kind less frequently, as frequently as would be performed in accordance with that practice;
              (e) do