Document ID: chunk:federal_register_of_legislation:F2021C00656:body:0:p8
Version: federal_register_of_legislation:F2021C00656
Segment Type: other
Provision Reference: 
Character Range: 19051–21984

Australian residential real property
       (7) The following requirements apply to investment by a managed investment fund in Australian residential real property, including any Australian land zoned for residential use (a residential real property investment):
(a) no direct residential real property investment may be made through the fund;
(b) no other residential real property investment (including, but not limited to, a debt or equity instrument, or a derivative) may be made through the fund unless:
           (i) the value of all residential real property investments is no more than 10% of the value of the fund's net assets; and
           (ii) the investment is not made for the dominant purpose of deriving financial benefits; and
           (iii) the investment is not made for the dominant purpose covered by subsection (8).
       (8) For the purposes of subparagraph (7)(b)(iii), this subsection covers the dominant purpose of assisting any of the following individuals to reside in or gain legal ownership in Australian residential real property (including any Australian land zoned for residential use):
(a) the investor;
(b) the investor's spouse or de facto partner;
       (c) any other member of the family unit of the investor or the investor's spouse or de facto partner.
       Derivatives
       (9) An investment may be made in a derivative, other than an option mentioned in paragraph (e) of the definition of securities in section 3, only if the investment:
(a) is made for risk management purposes; and
(b) is not a speculative investment; and
(c) is not designed to materially reduce or completely eliminate the exposure of an investor to the risk of loss from changes in the market price of an emerging companies investment.
Note Hedging of currency and interest rate risks will be permitted under subsection (9), however capital guarantee products are not permitted.
       Managed investment fund investments—cash in Australian ADIs
       (10) No more than 20% of a managed investment fund's net assets may be invested in cash held by Australian ADIs (including certificates of deposit, bank bills and other cash like instruments).
       Managed investment fund and venture capital fund investments—fund of funds or investor directed portfolio services
       (11) An investment in a managed investment fund or venture capital fund may be:
(a) made through a fund of funds or an investor directed portfolio service, if the investment otherwise complies with this instrument; and
(b) held in cash in the fund of funds, or investor directed portfolio service:
 (i) for up to 30 days after the funds are first made available for investment; and
 (ii) during any switching period mentioned in subregulation 5.19C(7) of the Regulations.

12 Allowable non compliance period
       Despite any other provision of this Part, if an investment would (apart from this section) breach of any of subsections