92. Definition of Collective Investment Scheme

(1) "Collective Investment Scheme" means any arrangements with respect to property of any description, including money, the purpose or effect of which is to enable Persons taking part in the arrangements (whether by becoming owners of the property or any part of it or otherwise) to participate in or receive profits or income arising from the acquisition, holding, management or disposal of the property or sums paid out of such profits or income.

(2) The arrangements must be such that the Persons who are to participate do not have day‐to‐day control over the management of the property, whether or not they have the right to be consulted or to give directions.

(3) The arrangements must also have either or both of the following characteristics:

• (a) the contributions of the participants and the profits or income out of which payments are to be made to them are pooled;
• (b) the property is managed as a whole by or on behalf of the operator of the scheme.

(4) If arrangements provide for such pooling as is mentioned in subsection (3)(a) in relation to separate parts of the property, the arrangements are not to be regarded as constituting a single Collective Investment Scheme unless the participants are entitled to exchange rights in one part for rights in another.

(5) The AFSA may by Rules provide that arrangements do not amount to a Collective Investment Scheme:

• (a) in specified circumstances; or
• (b) if the arrangements fall within a specified category of arrangement.

93. Registration of Collective Investment Schemes

(1) The AFSA may make Rules relating to the registration by it of Collective Investment Schemes.

(2) Rules made by the AFSA under section 93(1) may provide that all or certain categories of Collective Investment Schemes may not be established or promoted by Authorised Persons unless they have been registered.

(3) Rules made by the AFSA under section 93(1) may also include provisions as to:

• (a) the constitution, management and operation of such Collective Investment Schemes;
• (b) the investment and borrowing powers of such Collective Investment Schemes;
• (c) the procedure for application to the AFSA for registration of Collective Investment Schemes;
• (d) operating duties and responsibilities in respect of Collective Investment Schemes;
• (e) the registration of offering material or particulars and reporting requirements for Collective Investment Schemes; and
• (f) suspension of dealings in and termination of Collective Investment Schemes.

94. Power to give directions in respect of Collective Investment Schemes

(1) The AFSA may give a direction under this section if it appears to the AFSA that:

• (a) in respect of a Collective Investment Scheme registered under section 93(1), one or more of the requirements under Rules made pursuant to section 93(1) is no longer satisfied or is likely to be breached; or
• (b) it is necessary or desirable to give such a direction in order to protect the interests of participants in a registered Collective Investment Scheme.

(2) A direction under this section may:

• (a) require the Person or Persons responsible for the management or operation of a registered Collective Investment Scheme:

(i) to cease the issue or redemption of both the issue and redemption of units in the Collective Investment Scheme; or

(ii) to wind up the Collective Investment Scheme;

• (b) withdraw the AFSA’s registration of that Collective Investment Scheme; or
• (c) restrict or suspend promotion or sale of units in a Collective Investment Scheme.