Corporations Regulations 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

PART 7.1 - PRELIMINARY  

Division 5 - Custodial or depository services  

REGULATION 7.1.40   CONDUCT THAT DOES NOT CONSTITUTE THE PROVISION OF A CUSTODIAL OR DEPOSITORY SERVICE  

7.1.40(1)    
For paragraph 766E(3)(e) of the Act, conduct that is mentioned in subsection 766E(1) of the Act does not constitute providing a custodial or depository service if:

(a)    

the financial product held by the provider is a basic deposit product or is an account mentioned in subsection 981B(1) of the Act; or

(b)    the client is an associate of the provider (within the meaning of Division 2 of Part 1.2 of the Act); or

(c)    the provider and its associates have no more than 20 clients in aggregate for all custodial or depository services that they provide; or

(d)    the financial product is held as part of the arrangements for securing obligations under:

(i) a credit facility; or

(ii) a debenture that is held as trustee under a trust deed:

(A) entered into under section 283AA of the Act or former section 260FA of the Corporations Law of a State or Territory; or

(B) mentioned in former section 1052 of the Corporations Law of a State or Territory; or

(e)    the provider is a participant in a licensed market and the financial product held is a derivative acquired on the licensed market by the provider on behalf of a client; or

(f)    the provider is a participant in a licensed clearing and settlement facility and the financial product held is a derivative registered on the licensed clearing and settlement facility by the provider on behalf of the client; or

(g)    the financial product is held under:

(i) an order of a court; or

(ii) an order of a board or tribunal established under a law of a State or Territory; or

(iii) a direction by the holder of a statutory office established under a law of a State or Territory; or

(h)    the service is provided by a lawyer in the following circumstances:

(i) the financial service consists of acquiring, holding or disposing of a cash management trust interest, being an interest to which a law of a State or Territory relating to the audit of trust or controlled monies applies;

(ii) the lawyer is acting:

(A) on instructions from the client, an associate of the client or a relative of the client; and

(B) in his or her professional capacity; and

(C) in the ordinary course of his or her activities as a lawyer;

(iii) the financial service can reasonably be regarded as a necessary part of those activities;

(iv) the lawyer has not received, and will not receive, a benefit in connection with the activities other than:

(A) the payment of professional charges related to those activities; and

(B) reimbursement for expenses incurred or payment on account of expenses to be incurred on behalf of the client, an associate of the client or a relative of the client;

from the client or from another person on behalf of the client; or

(i)    the financial product is held by a trustee appointed under:

(i) a law of a State or Territory to administer monies awarded to a person as compensation; or

(ii) a trust formed for a charitable purpose.

7.1.40(2)    

For paragraph 766E(3)(e) of the Act, conduct that is mentioned in subsection 766E(1) of the Act does not constitute providing a custodial or depository service if the financial product is an Australian carbon credit unit that has been issued to:

(a)    a special native title account in accordance with section 49 of the Carbon Credits (Carbon Farming Initiative) Act 2011 ; or

(b)    a nominee account in accordance with section 141 of that Act.