Document ID: chunk:federal_register_of_legislation:C2012A00117:clause:1_52:p1
Version: federal_register_of_legislation:C2012A00117
Segment Type: clause
Provision Reference: sch 1 cl 52 (pt 1/3)
Character Range: 11192–13954

52  Covenants to be included in governing rules—registrable superannuation entities

Governing rules taken to contain covenants
 (1) If the governing rules of a registrable superannuation entity do not contain covenants to the effect of the covenants set out in this section, those governing rules are taken to contain covenants to that effect.

General covenants
 (2) The covenants referred to in subsection (1) include the following covenants by each trustee of the entity:
 (a) to act honestly in all matters concerning the entity;
 (b) to exercise, in relation to all matters affecting the entity, the same degree of care, skill and diligence as a prudent superannuation trustee would exercise in relation to an entity of which it is trustee and on behalf of the beneficiaries of which it makes investments;
 (c) to perform the trustee's duties and exercise the trustee's powers in the best interests of the beneficiaries;
 (d) where there is a conflict between the duties of the trustee to the beneficiaries, or the interests of the beneficiaries, and the duties of the trustee to any other person or the interests of the trustee or an associate of the trustee:
 (i) to give priority to the duties to and interests of the beneficiaries over the duties to and interests of other persons; and
 (ii) to ensure that the duties to the beneficiaries are met despite the conflict; and
 (iii) to ensure that the interests of the beneficiaries are not adversely affected by the conflict; and
 (iv) to comply with the prudential standards in relation to conflicts;
 (e) to act fairly in dealing with classes of beneficiaries within the entity;
 (f) to act fairly in dealing with beneficiaries within a class;
 (g) to keep the money and other assets of the entity separate from any money and assets, respectively:
 (i) that are held by the trustee personally; or
 (ii) that are money or assets, as the case may be, of a standard employer‑sponsor, or an associate of a standard employer‑sponsor, of the entity;
 (h) not to enter into any contract, or do anything else, that would prevent the trustee from, or hinder the trustee in, properly performing or exercising the trustee's functions and powers;
 (i) if there are any reserves of the entity—to formulate, review regularly and give effect to a strategy for their prudential management, consistent with the entity's investment strategies and its capacity to discharge its liabilities (whether actual or contingent) as and when they fall due;
 (j) to allow a beneficiary of the entity access to any prescribed information or any prescribed documents.

Superannuation trustee
 (3) In paragraph (2)(b), a superannuation trustee is a person whose profession, business or employment is or includes acting as a trustee of