Commonwealth Numbered Regulations - Explanatory Statements

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AUSTRALIAN SECURITIES COMMISSION AMENDMENT REGULATIONS 1998 (NO. 1) 1998 NO. 294

STATUTORY RULES 1998 No. 294

Issued by the authority of the Treasurer

Australian Securities and Investments Commission Act 1989

Australian Securities Commission Amendment Regulations 1998 (No. 1)

Section 251 of the Australian Securities and Investments Commission Act 1989 (the Act) empowers the Governor-General to make regulations, not inconsistent with the Act, prescribing matters which are required or permitted by the Act to be prescribed by regulations, or necessary or convenient to be prescribed by regulations for carrying out or giving effect to the Act.

The Heads of Agreement on Future Corporate Regulation in Australia, reached between Commonwealth, State and Northern Territory Ministers who had responsibilities in relation to corporate regulation in June 1990 forms the political compact on which the national companies and securities scheme is based. The Corporations Agreement, a more formal agreement to supplement the Heads of Agreement, was finalised on 23 September 1997.

The responsible Ministers of the States and the Northern Territory on the Ministerial Council for Corporations have been consulted about the regulations and the Council has approved them.

The regulations:

*       amend references to the Australian Securities Commission so that they instead refer to the Australian Securities and Investments Commission (ASIC) (the new title of the Commission) (Regulation 8.1-8.3 and 85-8.6);

*       amend a reference to the name of the Act, which is now called the Australian Securities and Investments Commission Act 1989 (Regulation 5);

*       add a reference to a new section, which relates to notices to produce books about financial services, to the relevant regulation and form (Regulations 7 and 8.4); and

*       empower ASIC to give a copy of a report of an investigation to two additional bodies - the Australian Competition and Consumer Commission and the Australian Prudential Regulation Authority (Regulation 6);

- the reason for this amendment is that ASIC works closely with the Australian Competition and Consumer Commission in relation to

- consumer protection in the financial services area, and with the Australian Prudential Regulation Authority which is responsible for the prudential regulation of bodies which ASIC regulates in other respects.

*       rename the regulations as the Australian Securities and Investments Commission Regulations 1990 (Regulations 4, 8.1, 8.3 and 8.5).

The amendments to the regulations are consequential to the Financial Sector Reform legislation which was recently enacted.

The Regulations commenced on gazettal.

Details of the regulations are attached.

ATTACHMENT

Regulation 1 - Name of regulation

Regulation 1 provides that the regulations are the Australian Securities Commission Amendment Regulations 1998 (No. 1)

Regulation 2 - Commencement

Regulation 2 provides that the regulations commence on gazettal.

Regulation 3 - Amendment

Regulation 3 provides that the Australian Securities Commission Regulations are amended as set out in the regulations.

Regulation 4 - Citation

Regulation 4 substitutes a new Regulation 1 which renames the regulations the Australian Securities and Investments Commission Regulations 1990.

Regulation 5 - Regulation 2 (Definitions)

Regulation 5 amends the definition of 'the Act' in Regulation 2 to reflect the amendment of the title of the principal Act, from the Australian Securities Commission Act 1989 to the Australian Securities and Investments Commission Act 1989.

The title of the Act was amended by Item 4, Schedule 1 of the Financial Sector Reform ,(Amendments and Transitional Provisions) Act 1989.

Regulation 6 - Regulation 3 (Prescribed agency: paragraph 18(2)(d) of the Act)

Subsection 18(2) of the Australian Securities and Investments Commission Act 1989 empowers the Commission to give a copy of the whole or a part of a report of an investigation undertaken by it to certain named bodies or a prescribed agency.

Regulation 3 previously prescribed four agencies.

Regulation 6 adds two further bodies to this list - the Australian Competition and Consumer Commission and the Australian Prudential Regulation Authority - and updates the titles of other bodies in the list.

The Australian Competition and Consumer Commission is added because, given the additional functions in relation to consumer protection in the financial services area which the Australian Securities and Investments Commission has been given, it will need to work closely with the Australian Competition and Consumer Commission.

The Australian Securities and Investments Commission will also need to work closely with the Australian Prudential Regulation Authority which is responsible for the prudential regulation of bodies which ASIC regulates in other respects.

Regulations 7 and 8.4 - Regulation 5 and Form 2 (Notice to produce books)

A reference to section 32A has been inserted in Regulation 5 (which provides that a notice under particular sections to produce books must be in accordance with Form 2) and in Form 2.

Section 32A was inserted in the Australian Securities and Investments Commission Act 1989 by the Financial Sector Reform (Consequential Amendments) Act 1998 and relates to notices to produce books about financial services.

Regulation 8.1 - 8.3, 8.5 - 8.6 - Schedule 1 (Forms)

Regulations 8.1 to 8.3, 8.5 and 8.6 amend references to the Australian Securities Commission and the Australian Securities Commission Regulations in Forms 1 to 3 in Schedule 1 by:

*       omitting references to the Australian Securities Commission and substituting references to the Australian Securities and Investments Commission; and

*       updating the name of the regulations in the headings.