Australia: Government Releases Second Tranche Of Revised CCIV Exposure Draft Bill


On 19 July 2018, the Federal Government released the second tranche of the revised Corporate Collective Investment Vehicle (CCIV) Exposure Draft Bill (Tranche 2 Exposure Draft Bill) for public consultation. This follows the release of the first tranche on 13 June 2018. In our previous Alert we outlined some of the key features of CCIVs.

The Tranche 2 Exposure Draft Bill proposes further provisions concerning:

  • external administration and winding up of a CCIV;
  • the application of the financial services regime in Chapter 7 of the Corporations Act (the Act) to CCIVs;
  • the liability of the corporate director of a CCIV and contraventions by the CCIV; and
  • the application of the takeover provisions to CCIVs.

External administration of a CCIV in a wind up situation

The Tranche 2 Exposure Draft Bill introduces the proposed external administration regime as it would apply to CCIVs. In order to preserve the segregation of assets between sub-funds (which are an essential feature of a the new structure), the provisions would apply as if the CCIV comprised only of the sub‑fund that is affected by the winding up, disregarding any other sub‑fund of the CCIV. Therefore, a winding up procedure in respect of one sub-fund has no legal effect on the other sub-funds.

Voluntary administration will not be available to CCIVs, nor will the ASIC-initiated wind up procedures be applicable.

The "separating assumptions"

The winding up provisions operate in respect of each sub‑fund by applying four "separating assumptions". These assumptions are that:

  • the only business carried on by the CCIV is the business of the sub‑fund in respect of which the CCIV is being wound up;
  • the only shares issued by the CCIV are the shares referable to that sub‑fund;
  • the only property of the CCIV is the property allocated to that sub‑fund; and
  • the only debts and claims of the CCIV are the liabilities of that sub‑fund.

The explanatory material notes that this approach differs from that adopted under the open ended investment company (OEIC) regime in the United Kingdom, where sub‑funds must have separate legal personality for winding up purposes only and the wind-up provisions apply directly to each sub-fund.

A winding up procedure for one sub‑fund has no legal effect on the other sub‑funds.

Statutory demands

The Tranche 2 Exposure Draft Bill proposes the following modifications to the provisions relating to statutory demands:

  • A creditor serving a statutory demand on a CCIV does not need to specify a particular sub-fund in the demand. The onus would be on the CCIV to identify the relevant sub‑fund because "this ensures that creditors who may be unable to identify the relevant sub‑fund are not disadvantaged and recognises that the CCIV is best placed to identify the sub‑fund to which a liability has been allocated".
  • If a CCIV applies to the Court to set aside a statutory demand disputing the existence of the debt, it need not identify the sub-fund.
  • If a CCIV applies to the Court to set aside a statutory demand disputing the amount of the debt:
  • It must file a written notice identifying the relevant sub-fund, otherwise the Court will dismiss the application.
  • If such a notice has been filed:
    • the statutory demand is taken to be a separate statutory demand served on the CCIV in respect of each sub‑fund or sub‑funds identified in the notice;
    • the CCIV is taken to have applied to the Court for an order setting aside each of those statutory demands; and
    • the Court must then consider the separating assumptions when determining whether to set aside the statutory demand.

Voluntary winding up

As per the separating assumptions, a CCIV may only be voluntarily wound up in respect of its sub‑funds. The corporate director is only required to call a meeting of the affected sub‑fund and notify the members of the sub‑fund of the proposed resolution, rather than calling a meeting of the CCIV. However, a resolution for winding up cannot be passed if an application for the CCIV to be wound up in insolvency has been filed. This prohibition applies irrespective of which sub‑fund is likely to be wound up pursuant to the application.

Liquidator's powers

The liquidator's powers and functions are limited to the sub-fund being wound up. These powers extend to carrying on the sub-fund's business and holding the assets of the sub-fund. The corporate director remains responsible for any determinations that need to be made with respect to the allocation of assets and liabilities to the sub-fund.

Other external administration procedures

Rules for receivership and schemes of arrangement are still under development. These rules will apply the provisions relating to receivership and schemes of arrangement separately for each sub‑fund, along similar lines to the approach for winding up.

Rules for deregistration of sub-funds and CCIVs are also under development.

Financial services and disclosure regimes

The Bill introduces two new categories of financial service:

  • operating the business and conducting the affairs of the CCIV (Corporate Director Services); and
  • acting as a depositary of a CCIV (Depositary Services).

Whilst a CCIV itself will be exempt from the requirement to hold an Australian Financial Services Licence (AFSL), its corporate director will be required to hold an AFSL for the Corporate Director Services and, likewise, depositaries will need to be licensed to provide Depositary Services. Corporate directors will still be able to provide financial services which are unrelated to the Corporate Director Services.

For the purposes of Chapter 7 of the Act, any action undertaken by a CCIV relating to a financial service or financial services business is deemed to also be undertaken by its corporate director.

The issue of shares and debentures in a CCIV would ordinarily be subject to the prospectus regime in the Act; however, the proposed modifications to Part 7.9 will mean that a PDS, rather than a prospectus, will need to be given to retail clients who acquire a security in a CCIV, aligning the disclosure arrangements with those that apply to registered schemes. 

CCIV PDS's will be subject to the same content requirements that ordinarily apply to PDSs for other financial products and (similar to existing exclusions) a PDS will not be required in situations such as small scale offerings, rights issues and issues to persons associated with the CCIV.

Liability framework

There are detailed rules prescribing the circumstances in which conduct of the corporate director, or of employees, directors or agents of the corporate director, are attributed to the CCIV for the purposes of the liability framework. Separate attribution rules apply in relation to Chapter 7 of the Act.

So that members of a CCIV do not suffer loss as a result of an offence or contravention of the law by a CCIV, the proposed framework provides that the corporate director of that CCIV is responsible for any contravention, and is taken to have committed any offence or contravened the civil penalty provision instead of the CCIV. 


UCITS funds and OEICs are not subject to the requirements and regulations regarding takeovers in their corresponding jurisdictions. Likewise, under the proposed amendments to the Act, holders of interests in CCIVs would not have to comply with the takeover, compulsory acquisition and buy-out provisions in Chapters 6 to 6C of the Act in relation to acquiring voting power in a CCIV. 

However, CCIVs will still need to comply with Chapters 6 to 6C when seeking to acquire control or voting power in an entity regulated by those chapters.

Consultation on the Tranche 2 Exposure Bill closes on 10 August 2018.

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
25 Oct 2018, Other, New York, United States

Once again, Dentons is proud to bring together insurance industry leaders, lawyers and regulators for a full-day examination of the most current issues.

26 Oct 2018, Other, New York, United States

Selling your company may be the most important and complicated transaction of your life. To achieve an optimal outcome, you need to get educated.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions