Document ID: chunk:federal_register_of_legislation:F2022C00868:reg:6:p2
Version: federal_register_of_legislation:F2022C00868
Segment Type: reg
Provision Reference: reg 6 (pt 2/3)
Character Range: 38101–40906

soon as practicable.
 (7) For subsection (6), an amount paid into an omnibus account by the custodian is a contingent amount if:
 (a) it is paid solely to prevent the continuation of a shortfall that occurred because of circumstances that were beyond the custodian's control or that was not intended by the custodian to arise; and
 (b) the custodian will be entitled to recover the amount when the circumstances are rectified or addressed.
 (8) The custodian of a passport fund must ensure that there is separation between the functions of asset holding and investment such that activities that relate to asset holding are being performed by persons who are separate from, and able to act independently from, investment officers, including by ensuring that:
 (a) no investment officer of the custodian is involved in or responsible for ensuring the holding of the assets of the passport fund; and
 (b) no investment officer of the custodian directly supervises any other officer of the custodian who is involved in or responsible for ensuring the holding of the assets of the passport fund; and
 (c) each officer of the custodian that is involved in or responsible for ensuring the holding the assets of the passport fund is independent from each investment officer of the custodian.
 (9) For subsection (8), an investment officer of a custodian is an officer or employee of the custodian whose responsibilities include investment decisions or trading decisions, whether in relation to the passport fund or otherwise, other than decisions that relate to:
 (a) deposit accounts; or
 (b) currency transactions that are conducted for the purposes of facilitating purchase and sale of assets of the passport fund, or other payment obligations of the passport fund, or the redemption, issue, subscriptions, cancellation or repurchase of interests in the passport fund.
 (10) Paragraph (4)(b) does not apply to a custodian in relation to the following assets held on trust for the members of the passport fund, or, if the passport fund is a body corporate, as an asset of the passport fund, if the operator is subject to regulatory requirements in the home economy for the passport fund in relation to holding those assets:
 (a) deposits with an entity which is subject to prudential regulation by a financial supervisory authority in an economy where the entity was incorporated which is, in the written opinion of the home regulator for the passport fund, generally largely compliant with the guidelines of the Basel Committee on Banking Supervision if:
 (i) the entity holds other assets of the passport fund under subsection (4); or
 (ii) the operator reasonably considers that holding the deposit taking facility by another person would raise unreasonable operational difficulties or be impracticable;
 (b)