The Australian Prudential Regulation Authority (APRA) today responded to news of a challenge to its decision in relation to the 120 day suspension of HOST-PLUS Pty Ltd from acting as trustee of the HOST-PLUS Superannuation Fund.

APRA suspended the trustee after concluding that it could no longer be relied on to perform its duties under the requirements of the Superannuation (Industry) Supervision Act 1993 (the SIS Act) and was incapable of making decisions on behalf of fund members. APRA also revoked the approval of the Funds trustee, HOST-PLUS Pty Ltd, to act as an approved trustee.

The regulators action was taken following the resignation of the employer representative directors on 3 March, which resulted in the board no longer being able to form a quorum to make decisions on behalf of the Fund under its governing rules.

APRA appointed Ernst & Young Superannuation Nominees No 1 Pty Ltd as acting trustee of HOST-PLUS for the duration of the suspension period.  Unless the directors are successful in their court application, the suspended trustee has the right to submit a new application to become an approved trustee. Any forthcoming application from HOST-PLUS will be assessed according to standard processes applied to all trustee applications and will include an evaluation of the fitness and propriety of proposed directors.

APRA will discuss any concrete proposal which addresses its concerns and rectifies the current difficulties faced by HOST-PLUS.

Noting that the remaining directors must first obtain leave from the Federal Court to bring the proceedings on behalf of HOST-PLUS Pty Ltd, the regulator will be vigorously defending the current legal action taken against it in the Court by those directors of HOST-PLUS Pty Ltd.

APRA is the prudential regulator of the financial services industry including banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry.  It currently regulates $1.5 trillion in assets for 20 million Australians.