Consideration resumed from 22 September.

Senate's amendments—

(1) Clause 2, page 1 (line 17), omit "1 July 1999", substitute "the day on which it receives the Royal Assent".

(2) Schedule 1, item 22, page 7 (lines 25 and 26), omit paragraph (e), substitute:

(e) no member of the fund is an employee of another member of the fund, unless the members concerned are relatives;

(3) Schedule 1, item 22, page 8 (lines 1 to 7), omit paragraph (2)(a), substitute:

(a) if the trustee of the fund is a body corporate:

(i) the member is the sole director of the body corporate; or

(ii) the member is one of only 2 directors of the body corporate, and the member and the other director are relatives; or

(iii) the member is one of only 2 directors of the body corporate, and the member is not an employee of the other director; and

(aa) if the trustees of the fund are individuals:

(i) the member is one of only 2 trustees, of whom one is the member and the other is a relative of the member; or

(ii) the member is one of only 2 trustees, and the member is not an employee of the other trustee; and

(4) Schedule 1, item 22, page 9 (line 15) to page 10 (line 3), omit subsection (6), substitute:

Extended meaning of employee in certain circumstances

(6) For the purposes of this section, a member of a fund, who is an employee of an employer-sponsor of the fund, is also taken to be an employee of another person (the other person ), if the employer-sponsor is:

(a) a relative of the other person; or

(b) either of the following:

(i) a body corporate of which the other person, or a relative of the other person, is a director;

(ii) a body corporate related to that body corporate; or

(c) the trustee of a trust of which the other person, or a relative of the other person, is a beneficiary; or

(d) a partnership, where:

(i) the other person, or a relative of the other person, is a partner in the partnership; or

(ii) the other person, or a relative of the other person, is a director of a body corporate that is a partner in the partnership; or

(iii) the other person, or a relative of the other person, is a beneficiary of a trust, if the trustee of the trust is a partner in the partnership.

Note 1: An effect of this subsection is that a fund will not be a self-managed superannuation fund if a member is employed by an employer-sponsor of the fund, and another member (who is not a relative) has a specified interest in that employer-sponsor: see paragraph (1)(e). An example of this would be where the employer-sponsor is a company of which another member is a director.

Note 2: Another effect is that a fund will not be a self-managed superannuation fund if its single member is employed by an employer-sponsor of the fund in which the other trustee of the fund (who is not a relative) has a specified interest: see subsection (2).

(6A) Subsection (6) does not limit the meaning of the term employee .

Regulations

(6B) For the purposes of this section:

(a) a member of a fund is taken to be an employee of a person belonging to a class specified in the regulations for the purposes of this paragraph; and

(b) despite subsections (6) and (6A) and section 15A, a member of a fund is not taken to be an employee of a person belonging to a class specified in the regulations for the purposes of this paragraph.