Version No. 096
Borrowing and Investment Powers Act1987
No. 13 of 1987
Version incorporating amendments as at
1 January 2017
table of provisions
Section Page
ii
Section Page
Part 1—Preliminary 1
1 Purpose 1
2 Commencement 1
3 Definitions 1
3A Application of sections of this Act 4
Part 2—Borrowing powers 5
Division 1—General 5
4 General borrowing authorisation 5
Division 2—Financial accommodation 5
5 Financial accommodation by way of overdraft in Australia 5
8 Financial accommodation in Australia 6
9 Financial accommodation within or outside Australia 6
10 Financial leases 6
11 Financial arrangements 6
11AA Limited validation of certain financial transactions 7
11AB Assumption of certain obligations and rights 8
Division 3—Guarantees 8
12 Guarantee of overdraft certified by Treasurer 8
13 Statutory guarantee 9
14 Guarantee of financial accommodation 10
14A Guarantee of certain obligations 10
15 Guarantee of financial arrangements 11
16 Appropriation for guarantee 11
17 Assignment and enforcement of guarantees 11
Division 4—Miscellaneous 12
17A Application of Act to certain authorities under the Water Act1989 12
17AB Application of Act to TAFE institutes 12
17B Application to State instrumentalities 12
18 Regulations with respect to securities 13
Part 3—Investment powers 15
Division 1—Preliminary 15
19 General investment authorisation 15
Division 2—Investment 15
20 Power to invest moneys 15
20A Limited validation of certain investments 15
21 Trading in investments 16
22 Underwriting 17
Part 4—Consequential amendments and transitional provisions 18
26 Transitional provisions 18
27 Enforcement of guarantees given before commencement of section 19
Part 5—Guarantees etc. for economic development projects 20
28 Definitions 20
29 Treasurer may execute guarantee etc. 21
30 Provisions applying to guarantees etc. under this Part 22
Schedules 24
Schedule 1 24
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Endnotes 38
1 General information 38
2 Table of Amendments 40
3 Amendments Not in Operation 54
4 Explanatory details 55
ii
Version No. 096
Borrowing and Investment Powers Act1987
No. 13 of 1987
Version incorporating amendments as at
1 January 2017
1
Part 1—Preliminary
Borrowing and Investment Powers Act1987
No. 13 of 1987
The Parliament of Victoria enacts as follows:
Part 1—Preliminary
1 Purpose
The purpose of this Act is to make provision for borrowing and investment powers for certain statutory bodies.
2 Commencement
This Act comes into operation on a day or days to be proclaimed.
3 Definitions
(1) In this Act—
arrangement means any agreement, arrangement, understanding, promise or undertaking whether express or implied or any transaction;
Australia means the Commonwealth of Australia and includes the territories of the Commonwealth;
S. 3(1) def. of authorised deposit-taking institution inserted by No. 11/2001 s.3(Sch. item7.1(a)).
authorised deposit-taking institution has the same meaning as in the Banking Act 1959 of the Commonwealth;
S. 3(1) def. of authority amended by Nos 99/1993 s.5, 100/1995 s.4(1).
authority means a body, person or persons specified in column 1 of an item in Schedule1;
S. 3(1) def. of bank amended by No. 99/1993 s.9, repealedby No. 11/2001 s.3(Sch. item7.1(b)).
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financial accommodation means a financial benefit or assistance to obtain a financial benefit arising from or as a result of—
(a) a loan;
(b) issuing, endorsing or otherwise dealing in promissory notes;
(c) drawing, accepting, endorsing or otherwise dealing in bills of exchange;
(d) issuing, purchasing or otherwise dealing in securities;
(e) granting or taking a lease of any real or personal property for financing but not for operating purposes;
(f) any other arrangement that the Governor in Council on the recommendation of the Treasurer approves;
S. 3(1) def. of financial arrangement substituted by No. 100/1995 s.4(3).
financial arrangement means an arrangement establishing rights and obligations to receive or deliver property the value of which, or to receive or make a payment in an amount which, or the value of which—
(a) depends on, or is derived from, the value, or price, at a particular future time or during a particular future period, of particular property, rights or liabilities; or
(b) depends on, or is derived by reference to, a particular rate, index or other factor at a particular future time or during a particular future period;
S.3(1) def.of invest amendedby No.56/2016 s.14.
invest includes acquisition, sale or divestment of an investment and entering into a transaction or arrangement for the protection or enhancement of investments;
lease means—
(a) any lease, licence, charter or hiring arrangement of any real or personal property; or
(b) any arrangement under which a right touse, operate, manage or provide services in respect of any real or personal property is granted by the owner to another person;
prescribed means prescribed by the regulations;
S. 3(1) def. of property inserted by No. 100/1995 s.4(2).
property means any legal or equitable estate or interest (whether present or future and whether vested or contingent) in real or personal property of any description;
security includes inscribed stock and debenture, bond, debenture stock, notes or any otherdocument creating, evidencing or acknowledging indebtedness in respect offinancial accommodation whether constituting a charge on property of an authority or not.
(2) An approval given under this Act may be given unconditionally or subject to such conditions as the Governor in Council or the Treasurer, as the case may be, thinks fit.
S. 3A insertedby No. 99/1993 s.6.
3A Application of sections of this Act
The sections of this Act specified in column 2 of an item in Schedule 1 apply to the authority specified in column 1 of that item.
Part 2—Borrowing powers[1]
Division 1—General
4 General borrowing authorisation
An authority may, for the purpose of performing its functions or exercising its powers—
(a) exercise any power conferred on it by this Part; and
(b) with the approval of the Governor in Council on the recommendation of the Treasurer, do anything necessary for, or incidental to, the exercise of any power conferred on it by this Part.
Division 2—Financial accommodation
S. 5 amendedby Nos 78/1988 s.4(a), 64/1991 s.10(a), 99/1993 s.7(a), 100/1995 s.5, 11/2001 s.3(Sch. item7.2).
5 Financial accommodation by way of overdraft in Australia
An authority to which this section applies may, with the approval of the Treasurer, obtain a financial benefit or assistance to obtain a financial benefit by way of overdraft of account at any authorised deposit-taking institution or other financial institution in Australia.
S. 6 amendedby Nos 64/1991 s.10(b), 99/1993 s.7(b), repealed by No. 100/1995 s.6.
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S. 7 amendedby No. 99/1993 s.7(c), repealed by No. 100/1995 s.6.
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S. 8 amendedby Nos 78/1988 s.4(b), 64/1991 s.10(a), 99/1993 s.7(d), substituted by No. 100/1995 s.6.
8 Financial accommodation in Australia
(1) An authority to which this section applies may, with the approval of the Treasurer, obtain financial accommodation within Australia.
(2) An authority to which this section applies may not obtain financial accommodation under this section by granting or taking a lease of real or personal property.
S. 9 amendedby No. 99/1993 s.7(e), substituted by No. 100/1995 s.6.
9 Financial accommodation within or outside Australia
(1) An authority to which this section applies may, with the approval of the Treasurer, obtain financial accommodation within or outside Australia.
(2) An authority to which this section applies may not obtain financial accommodation under this section by granting or taking a lease of real or personal property.
S. 10 amended by Nos 78/1988 s.4(c), 99/1993 s.7(f).
10 Financial leases
An authority to which this section applies may, with the approval of the Treasurer, obtain financial accommodation within or outside Australia under an arrangement under which or as part of which the authority enters into a lease of the whole or any part of real or personal property.
S. 11 amended by Nos 64/1991 s.10(b), 99/1993 s.7(g), substituted by No. 100/1995 s.7.
11 Financial arrangements
An authority to which this section applies—
(a) may, with the approval of the Treasurer, enter into and perform financial arrangements to hedge, protect or manage the value of its assets or liabilities, or prospective assets or liabilities, against movements in—
(i) currency rates, interest rates, prices of shares, property or commodities; or
(ii) any other rates, costs or other factors specified by the Treasurer, including rates, costs or other factors that affect, or could affect, the value of its assets or liabilities or prospective assets or liabilities; and
(b) may, with the approval of the Treasurer enter into financial arrangements to acquire or dispose of assets or liabilities.
S. 11AA inserted by No. 31/1991 s.4, amendedby No. 99/1993 s.7(h).
11AA Limited validation of certain financial transactions
(1) If—
(a) an authority to which this section applies entered into, or purported to enter into, a financial transaction that was not, or may not have been, a financial arrangement of a kind that the authority was authorised to enter into under section 4 and 11 or section 11; and
(b) another party to the financial transaction entered into the financial transaction in good faith and with no reason to suspect, at the time of entering into the financial transaction, that the transaction was not a financial arrangement of a kind that the authority was authorised to enter into under section 4 and 11 or section 11—
the financial transaction may be enforced as if it were a financial arrangement which the authority had been authorised to enter into.
(2) Subsection (1) applies in relation to transactions entered into whether before or after the commencement of section 4 of the Borrowing and Investment Powers (Further Amendment) Act 1991.
S. 11AB inserted by No. 85/1994 s.3.
11AB Assumption of certain obligations and rights
An authority to which this section applies may assume obligations and rights under or in connection with financial accommodation obtained by another person and any security for that financial accommodation if—
(a) the arrangements under which the other person obtained the financial accommodation or gave the security include provision for such an assumption by the authority; or
(b) all the parties to those arrangements and the authority agree in writing to the assumption by the authority—
and the Treasurer gives approval in writing.
Pt 2 Div. 2A (Heading and s. 11A) inserted by No. 78/1988 s.5,
amended by Nos 61/1992 s.3, 99/1993 ss7(i)(j), 10, 31/1995 s.52(Sch. 1 items 1.1, 1.2), repealedby No.40/2013 s.3(1).
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Division 3—Guarantees
12 Guarantee of overdraft certified by Treasurer
S. 12(1) amended by Nos 78/1988 s.6(a), 64/1991 s.10(c), 99/1993 s.7(k).
(1) This section applies in relation to the provision to an authority to which this section applies of a financial benefit, or assistance to obtain a financial benefit, referred to in section 5.
(2) If the Treasurer executes a certificate in or to the effect of the prescribed form relating to the provision to an authority of a financial benefit or assistance to obtain a financial benefit referred to in section 5, the due satisfaction of amounts payable by the authority as a result of or in connection with the provision to the authority of the financial benefit or assistance including, without limiting the generality of the foregoing, the payment of expenses of enforcing or obtaining or endeavouring to enforce or obtain such satisfaction is guaranteed by the Government of Victoria.
13 Statutory guarantee
S. 13(1) amended by Nos 99/1993 s.7(l), 130/1993 s.119(2)(a), 110/1994 s.34(a).
(1) This section applies in relation to the provision toan authority to which this section applies (otherthan Victorian Power Exchange, Generation Victoria or National Electricity) of—
(a) a financial benefit or assistance to obtain a financial benefit referred to in section 5; or
(b) financial accommodation—
S. 13(1)(b)(i) repealed by No. 100/1995 s.8(1).
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(ii) to which section 8 or 9 applies, unless the Treasurer executes a guarantee under section 14 in relation to the financial accommodation.
(2) The due satisfaction of amounts payable by an authority as a result of or in connection with the provision to the authority of financial accommodation including, without limiting the generality of the foregoing, the payment of expenses of enforcing or obtaining or
endeavouring to enforce or obtain such satisfaction is guaranteed by the Government of Victoria.
14 Guarantee of financial accommodation
S. 14(1) amended by Nos 78/1988 s.6(b), 64/1991 s.10(a), 99/1993 s.7(m).
(1) This section applies in relation to the provision to an authority to which this section applies of financial accommodation to which section 8, 9 or10 applies.
(2) The Treasurer may, on behalf of the Government of Victoria, execute a guarantee on such terms and conditions as the Treasurer determines in favour of any person or body of persons guaranteeing the due satisfaction of amounts that become payable and of other actions required to be performed as a result of or in connection with the provision to the authority of financial accommodation including, without limiting the generality of the foregoing, the payment of expenses of enforcing or obtaining or endeavouring to enforce or obtain such satisfaction.
S. 14A inserted by No. 85/1994 s.4.
14A Guarantee of certain obligations
(1) This section applies in relation to the assumption by an authority to which this section applies ofobligations and rights in accordance with section 11AB.
(2) The Treasurer may, on behalf of the Government of Victoria, execute a guarantee on such terms and conditions as the Treasurer determines in favour of any person or body of persons guaranteeing the due satisfaction of amounts that become payable and of other actions required to be performed as a result of or in connection with the provision by the authority of obligations and rights in accordance with section 11AB including, without limiting the generality of the foregoing, the payment of expenses of enforcing or obtaining or endeavouring to enforce or obtain such satisfaction.
15 Guarantee of financial arrangements
S. 15(1) amended by Nos 64/1991 s.10(b), 99/1993 s.7(n).
(1) This section applies in relation to an authority to which this section applies which has entered into a financial arrangement to which section 11 applies.
(2) If the Treasurer executes a certificate in or to the effect of the prescribed form relating to a financial arrangement entered into by an authority the due satisfaction of all amounts which become payable including, without limiting the generality of the foregoing, the payment of the expenses of enforcing or obtaining or endeavouring to enforce or obtain such satisfaction, is guaranteed by the Government of Victoria.