Inserts for
Superannuation Legislation Amendment (Stronger Super and Other Measures) Bill 2012: Intra‑fund consolidation of superannuation interests

EXPOSURE DRAFT

Commencement information	
Column 1	Column 2	Column 3	
Provision(s)	Commencement	Date/Details	
1.  Schedule ?, items 1 and 2	1 July 2012		
2.  Schedule ?, item 3	The later of:
(a) immediately after the commencement of the provision(s) covered by table item 1; and
(b) at the same time as item 2 of Schedule 2 to the Superannuation Legislation Amendment (MySuper Core Provisions) Act 2012 commences.
However, the provision(s) do not commence at all if the event mentioned in paragraph (b) does not occur.		
3.  Schedule ?, item 4	1 July 2012		

Schedule?—Intra‑fund consolidation of inactive superannuation interests
  
Superannuation Industry (Supervision) Act 1993
1  Subsection 10(1)
Insert:
inactive superannuation interest, in relation to a member’s interest in a superannuation fund, means an interest in a superannuation fund (other than a pooled superannuation trust, a self managed superannuation fund or an exempt public sector superannuation scheme) where:
(a)	the member has a superannuation interest in the fund which is not:
	(i)	a defined benefit interest; or
	(ii)	an interest of a kind supporting a superannuation income stream; or
	(iii)	an interest of a kind prescribed by the regulations for the purposes of this paragraph; and
	(b)	the member’s withdrawal benefit in relation to the interest in the fund is less than $1,000; and
	(c)	any of the following apply:
	(i)	no contributions, rollovers or transfers have been made to the interest in the fund, on behalf of the member, during the previous 2 years;
	(ii)	the member is a lost member within the meaning of the Superannuation Industry (Supervision) Regulations;
	(iii)	the member has an interest in an eligible rollover fund (other than an interest of a kind prescribed by the regulations for the purposes of this paragraph).
2  Before subsection 29E(7)
Insert:
Complying with rules relating to intra‑fund consolidation
	(6B)	The following additional condition is imposed on each RSE licence that relates to a superannuation entity for which the RSE licensee has obligations under section 108A. The condition is that the RSE licensee must ensure that the rules that that section requires in relation to the superannuation entity are complied with.
3  After section 108
Insert:
108A  Duties in relation to intra‑fund consolidation of inactive superannuation interests
	(1)	Each trustee of a superannuation entity (other than a pooled superannuation trust, a self managed superannuation fund or an exempt public sector superannuation scheme) must ensure that:
	(a)	rules are established (whether by inclusion in the governing rules or otherwise) setting out a procedure for consolidating the inactive superannuation interests held by the entity that:
	(i)	are superannuation interests of the same member or depositor of the entity; and
	(ii)	have the same rights and benefits as one or more other superannuation interests of the member; and
	(b)	those rules:
	(i)	provide for the consolidation of those interests, on an annual basis, by all of those interests being merged into one of the interests (the consolidated interest), and by the other interests then being cancelled; and
	(ii)	provide that fees are not payable for any merger or cancellation of superannuation interests as a result of such a consolidation; and
	(iii)	meet any other requirements of the regulations (including requirements relating to matters mentioned in subparagraph (i) or (ii)); and
	(c)	those rules are published in such a way that:
	(i)	will make the entity’s members or depositors aware of the procedure for consolidating such interests; and
	(ii)	meets any other requirements of the regulations; and
	(d)	provide that the consolidated interest must be the entity’s superannuation interest to which a contribution, rollover or transfer was most recently made.
	(2)	A trustee commits an offence if the trustee contravenes subsection (1). This is an offence of strict liability.
Penalty:	50 penalty units.
Note 1:	Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.
Note 2:	For strict liability, see section 6.1 of the Criminal Code.
4  Paragraph 108A(1)(d)
Repeal the paragraph, substitute:
	(d)	those rules:
	(i)	do not permit a superannuation interest that is a MySuper interest and another superannuation interest that is not a MySuper interest to be consolidated, unless a MySuper interest is the consolidated interest; and
	(ii)	subject to subparagraph (i), provide that the consolidated interest must be the entity’s superannuation interest to which a contribution, rollover or transfer was most recently made.