Document ID: chunk:federal_register_of_legislation:F2019L00648:body:0:p8
Version: federal_register_of_legislation:F2019L00648
Segment Type: other
Provision Reference: 
Character Range: 19171–22080

in a trust (not being an interest arising where legal title is held by a custodian) is also excluded from being an asset in Australia if:

       (a)          the interest is a proprietary interest in a particular asset or particular assets (rather than merely an interest in the due administration of the trust); and

       (b)          the asset or each asset would not be an asset in Australia if it were held directly by the locally incorporated insurer (either because it would be excluded under another provision of this Prudential Standard or because it would not otherwise be an asset in Australia within the meaning of paragraph 28(a) of the Act).[12]

Other equitable interests

23.         An equitable interest of a locally incorporated insurer in an asset (not being an equitable interest in property held under a managed investment scheme, or property held by a custodian, or property otherwise held on trust) is excluded from being an asset in Australia if:

       (a)          the legal owner of the asset (legal owner) does not reside in Australia;

       (b)          any amounts payable by the legal owner to the locally incorporated insurer in respect of the arrangement are payable outside Australia;

       (c)          the asset would not be an asset in Australia if it were held directly by the locally incorporated insurer (either because it would be excluded under another provision of this Prudential Standard or because it would not otherwise be an asset in Australia within the meaning of paragraph 28(a) of the Act); or

       (d)          the locally incorporated insurer cannot enforce its rights in relation to the asset in an Australian court.

Category C insurers

    24.         Paragraphs 25 to 36 apply to Category C insurers only.

Assets must be held by Category C insurer's custodian or agent in Australia

25.         Subject to paragraph 27, an asset of a Category C insurer is excluded from being an asset in Australia unless it is held for the Category C insurer by either:

       (a)          a custodian where:

           (i)            the legal title is held in a way specified in paragraph 18(a) or (b);

           (ii)         the conditions in paragraphs 19(a) to (l) are complied with[13]; and

           (iii)       under the external custody agreement, only the agent in Australia of the Category C insurer may give directions (either directly or via a delegated authority to another person as provided for in paragraph 29) to the custodian permitting or requiring any disposal of assets;[14] or

       (b)          the Category C insurer's agent in Australia (on trust for the Category C insurer).

26.         Nothing in paragraph 25(a)(iii) precludes a Category C insurer from requiring a co-signatory, who need not reside in Australia, to also authorise a direction to the custodian permitting or requiring disposal of an