Corporations Amendment Regulations 2002 (No. 3) (41 of 2002)

Schedule 1   Amendments commencing at 12.02 am (in the Australian Capital Territory) on 11 March 2002

[55]   After regulation 7.9.08

insert

7.9.08A Dealing with interest

For paragraph 1020G (1) (c) of the Act, Part 7.9 of the Act applies as if section 1017E of the Act were modified by adding after subsection 1017E (2C):

'(2D) In relation to money to which this section applies:

(a) the product provider is entitled to the interest on the account; and

(b) the interest on the account is not required to be paid into the account;

only if the product provider discloses to the person who paid the money that the product provider is keeping the interest (if any) earned on the account.'.

7.9.08B Crediting of payments before money is received

(1) For paragraph 1020G (1) (c) of the Act, Part 7.9 of the Act applies as if section 1017E of the Act were modified by adding after subsection 1017E (1):

'(1A) This section also applies to money paid by a product provider in the following circumstances:

(a) the product provider knows, or believes on reasonable grounds, that money (the client's money ) will be paid to the product provider to acquire, or acquire an increased interest in, one or more of the financial products mentioned in paragraph (1) (a) or (b) from the product provider (whether or not the acquisition would be by a person as a retail client);

(b) either:

(i) the financial product or increased interest was offered in this jurisdiction; or

(ii) the application for the financial product or increased interest was made in this jurisdiction; or

(iii) the money will be received in this jurisdiction;

(c) before receiving the client's money, the product provider pays an equivalent amount of money (the product provider's money ) into an account described in subsection (2).'.

(2) For paragraph 1020G (1) (c) of the Act, Part 7.9 of the Act applies as if section 1017E of the Act were modified by adding after subsection 1017E (5):

'(5A) If subsection (1A) applies:

(a) the product provider is not required to comply with this section in relation to the client's money; and

(b) subsections (2A), (2B), (2C), (2D), (3), (4), (5) and (6) apply to the product provider's money as if the money had been paid by the person who paid, or is expected to pay, the client's money.'.

(3) For paragraph 1017E (3) (d) of the Act, money may be taken out of an account if:

(a) the circumstances described in the modified subsection 1017E (1A) of the Act exist; and

(b) after paying the product provider's money, the product provider becomes aware, or has reasonable grounds to believe, that the client's money will not be paid.