Custodians turn attention to CIVs and MITs

The Australian Custodial Services Association will focus its attention around improving the local funds management sector to increase its global competitiveness in 2017.

Speaking to its 2016: Year in Review report, ACSA said it will specifically focus on the implementation of collective investment vehicles (CIVs) and corporate CIVs - each scheduled to be launched on 1 July 2017.

"The introduction of these two new vehicles brings Australia more closely in-line with a number of other jurisdictions where these types of vehicles are a fairly common structure for collective investment," ACSA said.

The association also said a host of regulatory, tax and operation changes are likely to shape the course of this year's custody industry.

On the tax front, the industry is collaborating on the managed investment trust (MIT) reforms. These are intended to reduce complexity, increase certainty and minimise compliance costs for MITs and their investors. Among others, there will be increased focus on withholding tax (WHT) for newly proposed investment structures and tax on financial arrangements (TOFA).

Under operations, the proposed CHESS replacement, improvements in the standardisation of processing of discount securities and improvements to proxy voting automation are all on the agenda for the association.

ACSA chair David Knights said 2016 was significant for the Australian custody industry. Assets held in custody increased by 1.4% to $2.9 trillion in the half-year to 30 June 2016. Year-end statistics are soon to be released.

On the regulatory and advocacy front, ACSA facilitated the implementation of the new Accounting Standard AASB 1056 for superannuation entities, and rollout of ASIC Regulatory Guide 133 for managed investments and custodial services. The year also marked a movement to T+2 days settlement to improve efficiency of the Australian markets and bring it at par with global standards.

Read more: AustraliaACSAAustralian Custodial Services AssociationAccounting Standard AASBASIC Regulatory GuideDavid KnightsReview
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