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Last Updated: 1 December 2016
AN ACT TO CONSOLIDATE AND AMEND THE LAW RELATING TO TRUSTEES
[TRU 12] Authorised investments12
12
- (a)in any of the Parliamentary stocks, public funds or government securities of Fiji, the United Kingdom, the Commonwealth of Australia, Canada, New Zealand, or any of the States of the Commonwealth of Australia or Provinces of Canada;
- (b)on first legal mortgage or charge of an estate in fee simple in land in Fiji or of an estate in leasehold from the State or the iTaukei Land Trust Board for an unexpired term of not less than 50 years at the time when such mortgage or charge is made;
- (c)in debentures or other securities charged on the funds or property of any city or town in Fiji;
- (d)in any one or more of the following namely—
- (i)on fixed deposit in any bank licensed under the provisions of the Banking Act 1995;
- (ii)on deposit in any savings bank licensed under the provisions of the Banking Act 1995;
- (iii)[Repealed]
- (e)in any security in respect of which repayment of the amount secured and payment of interest thereon is guaranteed by the Government of the Republic of Fiji, of the United Kingdom or of any other country in the Parliamentary stocks, public funds or government securities of which investment is authorised under any of the provisions of this subsection;
- (f)in any of the stocks, funds or securities for the time being authorised for the investment of money under the control or subject to the order of the court;
- (g)in any security or in any manner authorised by or under the provisions of any other Act;
- (h)subject to the provisions of subsections (3), (4), (5), (6), (7) and (8), in the purchase of the preference of ordinary stock or shares issued in Fiji, the United Kingdom, the Commonwealth of Australia or the Dominion of New Zealand by a company incorporated in any of such countries, being stock or shares registered therein;
- (i)subject to the provisions of subsections (3), (4), (5), (6), (7) and (8), in debentures, including debenture stock and bonds, and whether constituting a charge on assets or not, issued by any company in which at the time of investment it would have been proper to invest in the purchase of ordinary stock or shares;
- (j)subject to the provisions of subsections (4), (5), (6), (7) and (8), on deposit or notes, whether secured or unsecured, at interest either for a fixed term, not exceeding 7 years or at call, with any company in which at the time of investment it would have been proper to invest in the purchase of ordinary stock or shares; and
- (k)in any other stock, fund, security or other investments declared by the Minister by order to be an investment in which a trustee may invest trust funds.
[subs (1) am LN 112 of 1970 O 160, effective 8 October 1970; LN 118 of 1970 O 72, effective 13 November 1970; Ordinance 14 of 1975 s 60, effective 30 May 1975; Decree 7 of 2011 s 4, effective 1 March 2011; Act 31 of 2016 s 218, effective 1 December 2016]
(2) Any investments made under the powers conferred by this section may be varied from time to time.
(3) The stock, shares and debentures mentioned in subsection (1)(h) and (i) do not include—
- (a)any stock, shares or debentures the price of which is not quoted on a Stock Exchange in any of the countries mentioned in subsection (1)(h); or
- (b)shares or debenture stock not fully paid up, except shares or debenture stock that, by the terms of issue, are required to be fully paid up within 9 months of the date of issue.
(4) An investment under subsection (1)(h), (i) and (j) shall not, except with the prior approval of the Minister to be signified by notice in the Gazette, be made in any company that—
- (a)has a paid up share capital of less than $2 million;
- (b)has not paid a dividend in each of the 5 years immediately preceding the calendar year in which the investment is made on all the ordinary stock or shares issued by the company, excluding any shares issued after the dividend was declared; but for the purposes of this paragraph a company formed to take over the business of another company or other companies is deemed to have paid the requisite dividend in any year in which such a dividend was paid by the other company or all the other companies, as the case may be.
[subs (4) am LN 112 of 1970 O 160, effective 8 October 1970]
(5) A trustee who proposes to make any investment under the power conferred by subsection (1)(h), (i) and (j) shall first obtain and consider proper advice in writing on the question whether the investment is satisfactory having regard—
- (a)to the need for ensuring that investments of the trust are, so far as circumstances allow, sufficiently diversified in respect of the descriptions of investment and, where diversification within a particular description would be prudent, in respect of investments within that description;
- (b)to the suitability to the trust of investments of the description of investments proposed and of the investment proposed as an investment of that description.
(6) A trustee who retains any investment made under the powers conferred by subsection (1)(h), (i) and (j) shall determine at what intervals, the circumstances, and in particular the nature of the investment, make it desirable to obtain the advice mentioned in subsection (5), and shall obtain and consider that advice accordingly.
(7) For the purposes of subsections (5) and (6), proper advice means the advice of a person who is reasonably believed by the trustee to be qualified by his or her ability in and practical experience of financial matters; and that advice may be given notwithstanding that the person gives it in the course of his or her employment as an officer or servant.
(8) Subsections (5) and (6) shall not apply to one of 2 or more trustees where he or she is the person giving the advice required by this section to his or her co-trustee or co-trustees, and shall not apply where the powers of a trustee are lawfully exercised by an officer or servant competent under the provisions of subsection (7) to give proper advice.