Commonwealth Consolidated Acts Commonwealth Consolidated ActsConditions necessary for termination of control
(1) If APRA assumes control of a body corporate's business or appoints an administrator of a body corporate's business, APRA must ensure that either it or an administrator of the body corporate's business has control of the body corporate's business until:
(a) APRA considers that it is no longer necessary for it or an administrator to remain in control of the body corporate's business; or
(b) APRA has applied for the body corporate to be wound up.
A termination of control that is permitted under this section is called an ultimate termination of control .
Note: This provision does not prevent a change, or changes, between control of a body corporate's business by APRA and an administrator or between administrators.
Events to precede termination
(2) Before making an ultimate termination of control by a Life Insurance Act statutory manager of a body corporate's business, APRA must:
(a) do both of the following:
(i) ensure that directors of the body corporate have been appointed or elected under the body corporate's constitution at a meeting called by the statutory manager in accordance with the body corporate's constitution;
(ii) if the body corporate is an eligible foreign life insurance company--ensure that a Compliance Committee of the body corporate is established and operating for the purpose of section 16ZF; or
(b) do both of the following:
(i) appoint directors of the body corporate by instrument in writing;
(ii) if the body corporate is an eligible foreign life insurance company--ensure that a Compliance Committee of the body corporate is established and operating for the purpose of section 16ZF; or
(c) ensure that a liquidator has been appointed:
(i) unless subparagraph (ii) applies--for the body corporate; or
(ii) if the body corporate is an eligible foreign life insurance company--for the body corporate in relation to its Australian business assets and liabilities.
Power to terminate control
(3) If the requirements in subsections (1) and (2) are satisfied, APRA may by instrument in writing make an ultimate termination of control of a body corporate's business by a Life Insurance Act statutory manager.
(4) If the Life Insurance Act statutory manager at the time of the termination is an administrator, the instrument of termination also operates as a termination of the appointment of the administrator. A copy of the instrument must be given to the administrator. However, mere failure to give the copy to the administrator does not affect the termination of the appointment.
Period of director's appointment
(5) If a director is elected or appointed under subsection (2), the director takes office on the termination of the Life Insurance Act statutory manager's control of the body corporate's business. If the director was appointed by APRA, the director holds office until the body corporate's next annual general meeting, subject to any terms and conditions imposed by APRA on the director's appointment. If the director was appointed or elected under the body corporate's constitution, the constitution governs the appointment.
Note: For further information about what happens when a Life Insurance Act statutory manager is in control of a body corporate's business, see Subdivision B.