(1) This Act may be cited as the Unit Trusts Act 1960.

(2) This Act shall come into force on 1 April 1961.

(1) In this Act, unless the context otherwise requires,—

(2) Section 63 of the Companies Act 1955 shall apply to interests in a unit trust as if they were shares.

(1) There shall be a manager and a trustee of every unit trust.

(2) Subject to the provisions of this Act, the company that is the manager of any unit trust—

• (a) shall have vested in it the powers of management of the investments and other property that are subject to the trusts governing that unit trust; and

• (b) shall have the function (whether as principal or by an agent) of issuing or offering interests in the unit trust to the public for subscription or purchase, or of inviting the public to subscribe for or purchase such interests, or both of those functions; and

• (c) shall have the same liability for its acts and omissions in the exercise of its powers and functions as manager of the unit trust as it would if it exercised those powers and functions as a trustee.

(3) Subject to this Act, the trustee of a unit trust must have vested in it or in 1 or more nominated persons of the trustee or in 1 or more nominees of a nominated person of the trustee the investments and other property that are for the time being subject to the trusts governing the unit trust.

(4) A trustee corporation or company or bank must not act as a trustee of a unit trust, and a company must not act as manager of a unit trust if those 2 persons are associated with each other under subpart YB of the Income Tax Act 2007.

(1) Every manager of a unit trust shall be either—

• (a) a company within the meaning of the Companies Act 1955, other than a private company; or

• (b) a company within the meaning of the Companies Act 1993 that is—

  • (i) a reporting entity within the meaning of the Financial Reporting Act 1993; or

  • (ii) an exempt company within the meaning of the Financial Reporting Act 1993 that complies with the requirements of that Act as if it were a reporting entity.

(1A) Notwithstanding anything in the Financial Reporting Act 1993, a manager of a unit trust that is an exempt company within the meaning of that Act and that complies with the requirements of that Act relating to reporting entities shall not be required to comply with the requirements of that Act relating to exempt companies.

(2) No company shall act as manager of a unit trust unless a person approved by the FMA has given a bond to Her Majesty the Queen in the sum of 20,000 pounds conditioned to secure the due discharge by the manager of its obligations.

(3) The sum of 20,000 pounds named in a bond given under this section shall not be deemed to be a penalty, but shall be liquidated damages, and shall accordingly be recoverable in full as a debt due by the surety to Her Majesty the Queen unless the surety proves performance of every condition upon which the bond is defeasible.

(4) Every sum so recovered shall be paid into a Crown Bank Account to the credit of a Crown Bank Account, and the residue, after the deduction of costs and other expenses, shall, without further appropriation than this section, be paid to the trustee and applied by it towards the discharge of the obligations of the manager; and any balance not required for that purpose shall be refunded to the surety.

(5) A bond given under subsection (2) must be released if the unit trust has been wound up and the trustee and manager of the unit trust have given notice in writing of the winding up to the FMA.

(1) If authorised by the trust deed, any trustee of a unit trust has power to nominate, in writing, 1 or more persons in which are vested any of the investments and other property referred to in section 3(3).

(2) Upon the nomination of a person by the trustee, the trustee, in addition to its own obligations as trustee in relation to the unit trust, is jointly and severally liable with the nominated person for the due and faithful performance and observance by the nominated person of all the duties and obligations imposed on the nominated person in relation to the unit trust either by this Act or by law.

A person must not be nominated by a trustee under section 6 if—

• (a) the person is the manager or proposed manager of the unit trust in respect of which the nomination relates; or

• (b) the persons who are deemed by section YC 1 of the Income Tax Act 2007 to control the manager or proposed manager and the persons who are deemed by that section to control the proposed nominated person are the same persons.

(1) A nominated person may, if authorised in writing by the trustee of a unit trust, appoint 1 or more nominees in which are vested any of the investments and other property referred to in section 3(3).

(2) Upon the appointment of a nominee, the trustee and the nominated person that appointed the nominee, in addition to their own obligations in relation to the unit trust, are jointly and severally liable with the nominee for the due and faithful performance and observance by the nominee of all the duties and obligations imposed on the nominee in relation to the unit trust by this Act or by law.

A person must not be appointed nominee by a nominated person under section 6B if—

• (a) the person is the manager or proposed manager of the unit trust in respect of which the appointment relates; or

• (b) the persons who are deemed by section YC 1 of the Income Tax Act 2007 to control the manager or proposed manager and the persons who are deemed by that section to control the proposed nominee are the same persons.

The Securities Act 1978 applies to the offering to the public for subscription of interests in unit trusts.

No manager of a unit trust, and no person as agent of such a manager, shall issue or offer to the public for subscription or purchase any interest in a unit trust, or invite the public to subscribe for or purchase such an interest, unless—

• (a) provision has been made in a deed for the appointment of a trustee of the unit trust and for such other matters as are prescribed by this Act and by any regulations made thereunder; and

• (b) a trustee who holds a licence under the Securities Trustees and Statutory Supervisors Act 2011 that covers the unit trust has accepted appointment as trustee of the unit trust and has executed the trust deed; and

• (c) the trust deed has been approved for the purposes of this Act by the Registrar or the District Registrar and an authenticated copy thereof has been lodged with the District Registrar as required by section 9.

(1) Notwithstanding anything to the contrary in section 125 of the Companies Act 1955 or section 92 of the Companies Act 1993, as the case may be, the manager of each unit trust shall lodge an authenticated copy of the trust deed in respect thereof and of every amendment of that deed with the District Registrar.

(2) Every such copy shall be authenticated by a director or responsible officer of the company that is trustee of the unit trust.

(3) Where an authenticated copy of any amendment of the trust deed in respect of any unit trust has to be lodged with the District Registrar as aforesaid, it shall be so lodged within 14 days after the date of the execution of the amendment or (if the trust deed has not been so lodged at that date) within 14 days after the date on which the trust deed is so lodged.

(1) A trustee may not resign as trustee of a unit trust unless—

• (a) all functions and duties of the position have been performed; or

• (b) the manager has appointed another person who holds a licence under the Securities Trustees and Statutory Supervisors Act 2011 that covers the unit trust to the position, and the new trustee has accepted the appointment; or

• (c) the High Court consents.

(2) Despite anything to the contrary in the trust deed, a manager may not discharge or remove a trustee except with the approval of the High Court.

(3) Subsection (2) does not apply to the removal of a trustee by the manager under Part 2 of the Securities Trustees and Statutory Supervisors Act 2011.

(1) The manager of a unit trust (other than a manager referred to in subsection (2)) must, annually, send to every unit holder—

• (a) a copy of—

  • (i) the audited statement of accounts in respect of the trust; and

  • (ii) a statement summarising all amendments to the trust deed that have been made since the date of the last statement; or

• (b) a notice containing the statements specified in subsection (3).

(2) The manager of a unit trust that is an issuer (as defined in section 4(1) of the Financial Reporting Act 1993) must, annually, send to every unit holder—

• (a) a copy of—

  • (i) the financial statements registered under the Financial Reporting Act 1993 in respect of the trust; and

  • (ii) the auditor's report on those statements; and

  • (iii) a statement summarising all amendments to the trust deed that have been made since the date of the last statement; or

• (b) a notice containing the statements specified in subsection (3).

(3) The notice referred to in subsection (1)(b) or (2)(b), as the case may be, must contain—

• (a) a statement to the effect that the unit holder has a right to receive from the manager, free of charge, a copy of the information specified in subsection (1)(a) or (2)(a) (the specified information) if the unit holder, within 15 working days of receiving the notice, makes a request to the manager to receive a copy of the specified information; and

• (b) a statement to the effect that the unit holder may obtain a copy of the specified information by electronic means; and

• (c) a statement as to how the unit holder may obtain a copy of the specified information by electronic means (for example, from a specified Internet site).

(4) The notice may be accompanied by any additional information or documentation that the manager thinks fit.

(1) If the manager has sent a notice to a unit holder under section 11(1)(b) or (2)(b) and the unit holder, within 15 working days of receiving that notice, makes a request to the manager to receive a copy of the specified information, the manager must, as soon as practicable, send to the unit holder, free of charge, a copy of that specified information.

(2) If a unit holder makes a request under subsection (1),—

• (a) the request must be treated as a request for the manager to send to the unit holder each year a copy of the specified information under section 11(1)(a) or (2)(a); and

• (b) the manager must send to the unit holder each year a copy of the specified information under section 11(1)(a) or (2)(a) until the unit holder revokes the request by notice to the manager.

If the manager has sent a notice to a unit holder under section 11(1)(b) or (2)(b), the manager must ensure that—

• (a) a copy of the specified information is available in the manner described in section 11(3)(c) at all reasonable times during the period beginning on the date the notice is sent and ending on the date the manager acts under section 11(1) or 11(2) in relation to the next accounting period; and

• (b) the manner described in the notice under section 11(3)(c) allows a copy of the specified information to be readily accessible so as to be usable for subsequent reference.

(1) The following provisions shall be implied in every trust deed relating to a unit trust, notwithstanding anything to the contrary in the deed:

• (a) that the manager of the unit trust shall use its best endeavours to ensure that the unit trust is carried on in a proper and efficient manner:

• (b) that the manager of the unit trust shall—

  • (i) make available upon demand to the trustee thereof for inspection the whole of the manager's books and papers and all books and papers relating to the unit trust:

  • (ii) give to the trustee of the unit trust such information as that trustee requires with respect to all matters relating to the unit trust or to any business of the manager, or to any property of the manager (whether acquired before or after the date of the trust deed), or otherwise relating to the affairs of the manager:

• (c) that the trustee of the unit trust shall not act on any direction of the manager to acquire any property for the unit trust or dispose of any property of the unit trust if, in the trustee's opinion conveyed in writing to the manager, the proposed acquisition or disposal is manifestly not in the interests of the unit holders; and the trustee shall not be liable to the unit holders or to the manager for so refusing to act on any direction of the manager:

• (d) that the manager of a unit trust shall,—

  • (i) on request in writing of the trustee, or of either one-tenth in number of the unit holders, or of a unit holder or unit holders holding (at the date of the receipt by the manager of the request) not less than one-tenth of the value of the interests in the unit trust then held by unit holders, summon a meeting of unit holders to be held in accordance with section 18, by sending by post a notice specifying the time and place of the meeting to every unit holder at his last known address not later than 14 days before the date of the proposed meeting:

  • (ii) lay before the meeting copies of the last statements and summaries filed with the District Registrar in accordance with paragraph (b) of subsection (1) of section 20 and subsection (2) of that section.

(1A) A provision implied in a trust deed by regulations made under section 28(2)(e)—

• (a) does not apply to the extent that it is inconsistent with provisions implied in the trust deed by section 12(1); but

• (b) applies despite anything else to the contrary in the trust deed.

(2) Every provision implied in the trust deed relating to any unit trust in accordance with this section shall be enforceable by the trustee, the manager, or any unit holder of the unit trust.

(1) The provision in subsection (2) shall be implied in every trust deed relating to a unit trust for which the trustee is a portfolio investment entity, notwithstanding anything to the contrary in the deed.

(2) Where any money, investments or other property of the unit trust is employed in an activity carried on as a portfolio investment entity, the manager may adjust the interests in the unit trust of the beneficiaries in the way required by section HL 7 of the Income Tax Act 2004.

(1) The manager of any unit trust shall pay into a separate bank account all money received by that manager or any agent of that manager in respect of purchases of or subscriptions for interests in that unit trust.

(2) The manager of any unit trust shall, within such period not exceeding 7 days as the trust deed provides, pay to the trustee or a nominated person of the trustee or a nominee of a nominated person of the trustee all money received by that manager or any agent of that manager in respect of purchases of or subscriptions for interests in that unit trust, except so much thereof as the manager is entitled to deduct or retain in accordance with the trust deed.

All money required to be paid to the trustee or a nominated person of the trustee or a nominee of a nominated person of the trustee in accordance with subsection (2) of section 14 shall, upon receipt by the manager or any agent of the manager, become subject to the trusts declared in the trust deed governing the unit trust.

(1) The trust deed in respect of each unit trust shall state whether the manager has an obligation to buy back interests in the unit trust if requested to do so.

(2) Where the manager has such an obligation, the trust deed shall also state the manner in which and the conditions on which such interests are to be bought back, including the method of calculating the minimum price at which interests are to be bought back.

(1) Every interest in a unit trust shall be transferable.

(2) Where interests in a unit trust are transferable as aforesaid, the trust deed in respect of the unit trust shall state the manner in which transfers of interests in the unit trust shall be made and recorded.

(1) Where a meeting of the unit holders of any unit trust is held in accordance with subparagraph (i) of paragraph (d) of subsection (1) of section 12, the meeting shall be under the chairmanship of a nominee of the trustee, and shall be conducted in accordance with any provisions in that connection in the trust deed and otherwise as directed by the chairman of the meeting.

(2) A unit holder or unit holders holding not less than three-quarters of the value of the interests in the unit trust held by the unit holders who are present in person or by proxy at any such meeting and vote, and who hold not less than one-quarter of the value of all the interests in the unit trust held by unit holders, shall have the power by resolution to give such directions to the trustee of the unit trust as they think proper concerning the unit trust, being directions that are consistent with the provisions of the trust deed and this Act and any directions given by the Financial Markets Authority under the Securities Trustees and Statutory Supervisors Act 2011.

(3) Where any direction is so given to the trustee of a unit trust, the trustee may comply with the direction, and shall not be liable for anything done or omitted by it by reason of its following that advice or direction.

(4) In any case where the trustee of a unit trust is of opinion that any direction so given conflicts with the trusts, a direction of the Financial Markets Authority, any rule of law, or is otherwise objectionable, the trustee may apply to the High Court for directions in the matter, and the decision and order therein shall be final:

provided that nothing in this subsection shall make it necessary to apply to the court for directions.

(5) Where a unit holder is a company or other corporation its properly appointed representative may be its proxy.

(1) The court may, on the application of the trustee of a unit trust, or any unit holder, or of the FMA, order that the manager be removed from that office.

(2) The manager of any unit trust shall cease to hold that office if—

• (a) the trustee certifies that it is in the interest of the unit holders that the manager should do so; or

• (b) the unit holders, at a meeting held pursuant to section 18, so direct.

(3) If the court orders the removal of the manager of any unit trust, or if any manager of a unit trust ceases to hold office under subsection (2), that manager shall immediately desist from all activities related to the unit trust.

(1) This section applies if a trustee is satisfied that—

• (a) there is a significant risk that the interests of unit holders will be materially prejudiced; or

• (b) the provisions of the trust deed are no longer adequate to give proper protection to unit holders.

(2) The trustee may apply to the High Court for an order under this section.

(3) The court may direct that an application be served on any person that the court thinks fit.

(4) On an application, the court may, after giving the manager and any other persons that the court thinks fit the opportunity to be heard, by order—

• (a) amend the provisions of the trust deed:

• (b) impose restrictions on the activities of the trustee or the manager (including, in the case of the manager, restrictions on advertising) that the court thinks are necessary for the protection of the interests of unit holders:

• (c) direct the manager or trustee to convene a meeting of unit holders for the purpose of—

  • (i) having placed before them by the trustee any information relating to their interests, and any proposals for the protection of their interests, that the court or the trustee considers necessary or appropriate; and

  • (ii) obtaining their opinions or directions in relation to the information and proposals referred to in subparagraph (i):

• (d) give directions in relation to the conduct of any meeting convened in accordance with paragraph (c):

• (e) stay all civil proceedings before any court by or against the trustee or the manager:

• (f) restrain the payment of money by the trustee or the manager to unit holders or a class of unit holders:

• (g) remove a person as manager and appoint another person as manager (with any powers that the court orders):

• (h) give any other directions that the court considers necessary to protect the interests of unit holders, or the public.

(5) The court may vary or cancel an order made under this section.

(6) In exercising its powers under this section, the court must have regard to the interests of all creditors in respect of the unit trust.

(1) [Repealed]

(2) The manager, in relation to each unit trust, that is not an issuer within the meaning of section 4 of the Financial Reporting Act 1993, shall file or cause to be filed with the District Registrar annually an audited statement of the accounts of the trust, and a summary of purchases and sales of property under the unit trust, and a list of all the investments of the unit trust as at the end of the period to which the accounts relate, together with particulars of the cost and the estimated market value as at that date of the investments and other property.

(2A) The manager, in relation to each unit trust, that is an issuer within the meaning of section 4 of the Financial Reporting Act 1993, shall attach to the financial statements to be delivered to the Registrar of Companies under that Act a summary of purchases and sales of property under the unit trust, and a list of all the investments of the unit trust as at the end of the period to which the financial statements relate, together with particulars of the cost and the estimated market value as at that date of the investments and other property.

(3) Where a new trustee or a new manager of a unit trust is appointed at any time after the commencement of the trust, that trustee or manager shall give notice of the appointment to the District Registrar within 28 days after the date of the appointment.

(4) The documents lodged with the District Registrar pursuant to section 9 and the foregoing provisions of this section shall be open for public inspection on payment of the prescribed fee.

(5) Every list, statement, summary, and document filed with the District Registrar under this section shall be verified by a statutory declaration made by a director of the company that is manager of the unit trust or by a responsible officer of the company.

(1) One or more inspectors to investigate and report on the affairs of any unit trust and its manager may be appointed by—

• (a) [Repealed]

• (b) the High Court on application made either by one-tenth in number of the unit holders of the unit trust or by a unit holder or unit holders holding at the date of the application not less than one-tenth of the value of the interests in the unit trust then held by unit holders.

(2) Every such inspector shall have in relation to the unit trust and its manager and affairs all the powers conferred on an inspector in relation to a company and its affairs by section 171 of the Companies Act 1955 (except subsection (3) of that section); and those provisions, so far as they are applicable and with the necessary modifications, shall apply accordingly. The report of every such inspector who is appointed by the High Court shall be made to that court.

(3) If any officer or agent of a company that is manager of a unit trust in respect of which an inspector has been appointed under this section refuses to produce to the inspector any book or paper which it is his duty under this section so to produce, or refuses to answer any question which is put to him by the inspector with respect to the affairs of the company or unit trust, that officer or agent commits an offence and is liable on conviction to imprisonment for a term not exceeding 3 months or to a fine not exceeding 100 pounds.

(4) No such officer or agent shall be excused from answering any question put to him by an inspector with respect to the affairs of the company or unit trust on the ground that the answer may incriminate or tend to incriminate him, but no statement made by him in answer to any such question shall be admissible against him in criminal proceedings, except proceedings under the Crimes Act 1961 for making a false statement upon oath.

(1) Subject to any contrary intention expressed in the trust deed in respect of any unit trust, where in the opinion of the High Court any sale or other disposition, or any purchase, investment, acquisition, retention, expenditure, or other transaction is expedient in the management or administration of any money, investments, or other property for the time being subject to the trusts governing a unit trust or would be in the best interests of the unit holders of the unit trust, but it is inexpedient or difficult or impracticable to effect the same without the assistance of the court, or the same cannot be effected by reason of the absence of any power for that purpose vested in the trustee or manager of the unit trust by the trust deed or by law, the High Court may by order confer upon the trustee or manager, either generally or in any particular instance, the necessary power for the purpose, on such terms and subject to such provisions and conditions (if any) as that court may think fit, and may give such directions as it thinks fit to the trustee or manager in respect of the exercise of any power conferred by the order.

(2) An application to the court under this section may be made by either the manager or the trustee or any unit holder.

(1) If any vacancy occurs in the office of manager of a unit trust, the trustee thereof shall have the power to appoint a qualified company as temporary manager thereof, which temporary manager shall have all the powers conferred on the manager by the trust deed or by law until a manager is appointed.

(2) Upon any such vacancy occurring, the trustee of the unit trust shall summon a meeting of the unit holders of the unit trust, and shall take such steps as that meeting or any subsequent meeting of those unit holders may require to secure the appointment of that company or some other qualified company as manager of the unit trust.

(1) The trustee of a unit trust and the manager thereof shall each have the same duty to observe care and diligence in the performance of its duties as any other trustee, and shall each be entitled to the same indemnities and relief as any other trustee.

(2) Any provision in a trust deed governing a unit trust or in any other instrument shall be void so far as it would have the effect of—

• (a) exempting the trustee or manager or any director or officer of the trustee or manager from liability for breach of trust where it or he fails to show the degree of care and diligence required of it or him in that capacity, having regard to the provisions of the trust deed and the powers, authorities, or discretions conferred thereby:

• (b) indemnifying the trustee or manager or any such director or officer from any such liability.

(1) Every person commits an offence and is liable on conviction to a fine not exceeding $1,000,000 who—

• (a) issues any interest in a unit trust or offers any such interest to the public for subscription or purchase, or invites the public to subscribe for or purchase such an interest, in contravention of any provision of this Act; or

• (b) continues any activities related to any unit trust in contravention of subsection (3) of section 19.

(2) Every person commits an offence and is liable on conviction to a fine not exceeding $10,000 who fails to comply with any of the provisions of sections 9, 11, 11A, 11B, 14, and 20.

(3) Every person who has at any time, whether before or after the commencement of this Act, been convicted of a crime involving dishonesty within the meaning of the Crimes Act 1961 commits an offence and is liable on conviction to imprisonment for a term not exceeding 3 months or to a fine not exceeding $200,000, if, after the commencement of this Act, without the consent of the FMA, proof whereof shall lie on the person alleging consent, he acts as a director, officer, or responsible employee of a company that is the manager of a unit trust.

(1) Every person who is a director or officer of a company that is the manager of a unit trust, or of a trustee corporation or company or bank that is the trustee of a unit trust, shall be a trustee for the benefit of the unit holders of any personal profit or benefit which he gains by availing himself of his position, whether by buying or selling or joining in buying or selling investments or securities or otherwise:

provided that nothing in this subsection shall affect the right of any such director or officer to receive and retain remuneration from the trustee corporation or company or bank of which he is a director or officer.

(2) Any such personal profit shall be transferred to the trustee of the unit trust, and may be recovered by that trustee from the person who gained it.

(1) If, in the course of winding up any company that is the manager of a unit trust, it appears that the company has misapplied or retained or become liable or accountable for any money or property of the unit trust, or committed any misfeasance or breach of trust in relation to the unit trust, the court may, on the application of the Official Assignee or of the liquidator or of the trustee or of any unit holder, examine into the conduct of any past or present director, manager, or liquidator, or any officer of the company who has been a party to or knowingly permitted the misapplication, retention, misfeasance, or breach of trust, and compel him to repay or restore the money or property or any part thereof respectively with interest at such rate as the court thinks just or to contribute such sum to the assets of the trust by way of compensation in respect of the misapplication, retention, misfeasance, or breach of trust as the court thinks just.

(2) The provisions of this section shall have effect notwithstanding that the act is one for which the offender may be criminally liable.

(3) Where an order for payment of money is made under this section, the order shall be deemed to be a final judgment within the meaning of section 17(1)(a) of the Insolvency Act 2006.

(1) The Governor-General may from time to time, by Order in Council, make all such regulations as may in his opinion be necessary or expedient for giving full effect to the provisions of this Act and for the due administration thereof.

(2) Without limiting the general power to make regulations conferred by subsection (1), regulations may be made under this section for all or any of the following purposes:

• (a) prescribing the maximum commission that may be charged, and the maximum charge for administration and other expenses that may be made, by the manager or trustee of any unit trust:

• (b) prescribing the fees to be paid on the lodging or filing of any documents in respect of a unit trust with the Registrar or District Registrar, and on the inspection of any such documents:

• (c) prescribing the manner in which the accounts of the unit trust are to be kept:

• (d) prescribing information and other matters that must be included in a trust deed:

• (e) subject to subsection (3), prescribing provisions to be implied into a trust deed.

(3) A provision prescribed for the purposes of subsection (2)(e) may, without limitation, do any of the following:

• (a) specify the duties and powers of the trustee:

• (b) specify the duties of the manager:

• (c) provide for the trustee to have the power, exercisable with the consent of the manager (but without requiring the consent of unit holders), to make amendments to the trust deed that do not adversely affect the interests of unit holders.

The terms of any trust created before the commencement of this Act in pursuance of a unit trust scheme or arrangement may, notwithstanding anything in any deed or other instrument, be varied or supplemented by a deed made between the trustee and manager under the scheme or arrangement, or otherwise as the Minister may approve, to enable compliance with the requirements of this Act.