Borrowing and Investment Powers Act 1987
VersionNo. 100
Borrowing and Investment Powers Act1987
No. 13 of 1987
Version incorporating amendments as at
1 November 2017
table of provisions
SectionPage
1
SectionPage
Part 1—Preliminary
1Purpose
2Commencement
3Definitions
3AApplication of sections of this Act
Part 2—Borrowing powers
Division 1—General
4General borrowing authorisation
Division 2—Financial accommodation
5Financial accommodation by way of overdraft in Australia
8Financial accommodation in Australia
9Financial accommodation within or outside Australia
10Financial leases
11Financial arrangements
11AALimited validation of certain financial transactions
11ABAssumption of certain obligations and rights
Division 3—Guarantees
12Guarantee of overdraft certified by Treasurer
13Statutory guarantee
14Guarantee of financial accommodation
14AGuarantee of certain obligations
15Guarantee of financial arrangements
16Appropriation for guarantee
17Assignment and enforcement of guarantees
Division 4—Miscellaneous
17AApplication of Act to certain authorities under the Water Act1989
17ABApplication of Act to TAFE institutes
17BApplication to State instrumentalities
18Regulations with respect to securities
Part 3—Investment powers
Division 1—Preliminary
19General investment authorisation
Division 2—Investment
20Power to invest moneys
20ALimited validation of certain investments
21Trading in investments
22Underwriting
Part 4—Consequential amendments and transitional provisions
26Transitional provisions
27Enforcement of guarantees given before commencement of section
Part 5—Guarantees etc. for economic development projects
28Definitions
29Treasurer may execute guarantee etc.
30Provisions applying to guarantees etc. under this Part
Schedules
Schedule 1
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Endnotes
1General information
2Table of Amendments
3Amendments Not in Operation
4Explanatory details
1
VersionNo. 100
Borrowing and Investment Powers Act1987
No. 13 of 1987
Version incorporating amendments as at
1 November 2017
1
Part 1—Preliminary
Borrowing and Investment Powers Act1987
No. 13 of 1987
The Parliament of Victoria enacts as follows:
Part 1—Preliminary
1Purpose
The purpose of this Act is to make provision for borrowing and investment powers for certain statutory bodies.
2Commencement
This Act comes into operation on a day or days to be proclaimed.
3Definitions
(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 enteringinto 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).
propertymeans 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.
3AApplication 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
4General 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).
5Financial 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.
8Financial 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.
9Financial 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).
10Financial 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.
11Financial 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).
11AALimited 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.
11ABAssumption 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
12Guarantee 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.
13Statutory 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.
14Guarantee 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.
14AGuarantee 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.
15Guarantee 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.
16Appropriation for guarantee
(1)Any sums required by the Treasurer in fulfilling any liability arising under a guarantee by or on behalf of the Government of Victoria provided by this Division or given under this Division shall be paid out of the Consolidated Fund (which is hereby to the necessary extent appropriated accordingly).
(2)Any sums received or recovered by the Treasurer from an authority or otherwise in respect of any sums paid by the Treasurer under a guarantee shall be paid into the Consolidated Fund.
17Assignment and enforcement of guarantees
(1)The whole or any part of the benefit of a guarantee under this Division may be assigned by the person entitled to the benefit for the time being, unless the terms and conditions of the guarantee otherwise provide.
(2)A guarantee under this Part has effect and may be enforced as if the guarantee were a contract made on behalf of the Crown and section 23(1)(a) of the Crown Proceedings Act 1958 applied accordingly.
Division 4—Miscellaneous
S. 17A inserted by No. 99/1993 s.11.
17AApplication of Act to certain authorities under the Water Act1989[2]
(1)In this section—
Authority has the same meaning as in the Water Act 1989 but does not include the Rural Water Corporation.
S. 17A(2) substituted by No. 45/1997
s. 6.
(2)The Governor in Council, by Order published in the Government Gazette, may declare that sections of this Act specified in the Order apply to an Authority specified in the Order.
S. 17AB inserted by No. 76/2013
s. 29.
17ABApplication of Act to TAFE institutes
(1)The Governor in Council, by Order published in the Government Gazette, may declare that sections of this Act specified in the Order apply to a TAFE institute specified in the Order.
(2)In this section TAFE institute has the same meaning as it has in section 1.1.3(1) of the Education and Training Reform Act 2006.
S. 17B inserted by No. 45/1997
s. 7.
17BApplication to State instrumentalities
(1)In this section—
public authority means—
(a)an agency or instrumentality of the State established by or under an Act;
(b)a body established by an Act a member of which, or a member of the governing body of which, is appointed by the Governor in Council or a Minister;
(c)a body corporate established under section 14 of the State Owned Enterprises Act 1992.
(2)The Governor in Council, by Order published in the Government Gazette, may declare that sections of this Act specified in the Order apply to a public authority specified in the Order.
(3)In addition to the powers conferred on it by or under the Act by or under which it is established, a public authority specified in an Order in force under subsection (2) has the powers conferred on it by the sections of this Act specified in the Order.
18Regulations with respect to securities
(1)The Governor in Council may make regulations for the purposes of this Part for or with respect to any of the following—
(a)the form of securities issued under this Part in Australia;
(b)the issue of securities under this Part in Australia;
(c)the rights attached to securities issued under this Part in Australia;
(d)the keeping of registers of securities issued under this Part in Australia;
(e)fees payable for inspection of or to obtain copies of or extracts from registers kept in Australia of securities issued under this Part in Australia;
(f)the sale and transfer of securities issued under this Part in Australia;
(g)any other matter or thing required or permitted by this Part to be prescribed or necessary to be prescribed to give effect to this Part.
(2)Regulations made under this Part—
(a)may be of general or specially limited application; and
(b)may differ according to differences in time, place or circumstance.
Part 3—Investment powers
Division 1—Preliminary
19General investment 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—Investment
S. 20 amended by Nos 78/1988 s.6(c), 64/1991 s.10(a), 99/1993 s.7(o).
20Power to invest moneys
An authority to which this section applies may, with the approval of the Treasurer, invest moneys of the authority in any manner approved by the Governor in Council on the recommendation of the Treasurer in relation to the authority.
S. 20A inserted by No. 31/1991 s.5, amendedby No. 99/1993 s.7(p).
20ALimited validation of certain investments
(1)If—
(a)an authority to which this section applies entered into, or purported to enter into, a transaction or arrangement in the exercise of a power of investment that was not, or may not have been, a power of a kind that the authority was authorised to exercise under section 19 and 20 or section 20; and
(b)another party to the transaction or arrangement entered into the transaction or arrangement in good faith and with no reason to suspect, at the time of entering into the transaction or arrangement, that the transaction or arrangement was not entered into by the authority in the exercise of a power of investment of a kind that the authority was authorised to exercise under section 19 and 20 or section 20—
the transaction or arrangement may be enforced asif it had been entered into by the authority in the exercise of a power of investment under section 19 and 20 or section 20.
(2)Subsection (1) applies in relation to transactions and arrangements entered into whether before or after the commencement of section 5 of the Borrowing and Investment Powers (FurtherAmendment) Act 1991.
S. 21 amended by Nos 78/1988 s.6(d), 64/1991 s.10(a), 99/1993 s.7(q).
21Trading in investments
An authority to which this section applies and to which the Governor in Council on the recommendation of the Treasurer has given approval for the purposes of this section, may exercise any power in relation to investments that a natural person may exercise and, without limiting the generality of the foregoing—
(a)may sell, barter, exchange or otherwise dispose of or get in any of its investments; and
(b)may vary or transpose any of its investments for other investments in which the authority is authorised to invest.
S. 22 amended by Nos 64/1991 s.10(b), 99/1993 s.7(r).
22Underwriting
An authority to which this section applies may, with the approval of the Governor in Council on the recommendation of the Treasurer, underwrite or sub-underwrite the issue by a body corporate or unincorporate of any shares, units in a unit trust or securities in which the authority is authorised to invest.
Part 4—Consequential amendments and transitional provisions
Ss 23–25 repealed by No. 99/1993 s.12(1).
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26Transitional provisions
(1)A provision of an Act amended by section 23 continues to apply to or in respect of—
(a)moneys borrowed or re-borrowed, loans, advances and financial accommodation obtained and financial arrangements entered into and any other thing done under borrowing powers or powers to obtain financial accommodation conferred by the Act before the commencement of that section; and
(b)moneys borrowed or re-borrowed, loans, advances and financial accommodation obtained and any other thing done under borrowing powers or powers to obtain financial accommodation conferred by the Act after that commencement, pursuant to arrangements entered into before that commencement—