Document ID: chunk:federal_register_of_legislation:C2007A00078:clause:8_44:p2
Version: federal_register_of_legislation:C2007A00078
Segment Type: clause
Provision Reference: sch 8 cl 44 (pt 2/5)
Character Range: 40891–43533

Board determines under section 25‑5 of the Venture Capital Act 2002, starting from the time the investment is made.
However, subparagraph (c)(i) or (ii) does not apply to the unit trust if the Venture Capital Registration Board so determines under section 25‑10 of the Venture Capital Act 2002.

Note: A company that fails to meet the requirements of this subsection can still be eligible in certain circumstances: see subsection (13).

Predominant activity

 (4) The unit trust must satisfy at least 2 of these requirements:
 (a) more than 75% of the unit trust's assets (determined by value) must be used primarily in activities that are not ineligible activities mentioned in subsection (14);
 (b) more than 75% of the employees of the trustee of the unit trust must be engaged primarily in activities that are not ineligible activities mentioned in subsection (14);
 (c) more than 75% of the unit trust's total assessable income, *exempt income and *non‑assessable non‑exempt income must come from activities that are not ineligible activities mentioned in subsection (14).

Note 1: This requirement is ongoing. It is not limited to the circumstances at the time the investment was made.

Note 2: See subsection (11) for the value of assets.

Note 3: A unit trust that fails to meet at least 2 of the requirements can still be eligible if the Venture Capital Registration Board determines that the unit trust's primary activity is not ineligible and the failure is temporary: see subsection (15).

Investment in other entities etc.

 (5) The unit trust must not:
 (a) invest, in another entity, any part of the amount invested, unless the other entity:
 (i) is *connected with the unit trust (except another entity that is an *associate of the unit trust because of an investment made in the entity by the partnership); and
 (ii) meets the requirements of subsections (4) to (8); or
 (b) in the capacity of a trustee, use any part of the amount invested.
However, this subsection does not prevent the unit trust from depositing money with an *ADI, or with a body authorised by or under a law of a foreign country to carry on banking business in that country.

Note: This requirement is ongoing. It is not limited to the circumstances at the time the investment was made.

Registered auditor

 (6) The unit trust must, at the end of, and at all times after the end of, the income year in which the investment is made, have as its auditor:
 (a) a person registered as an auditor under a law in force in a State or a Territory; or
 (b) if the unit trust is no longer an Australian resident—a person registered as an auditor under a law in