Commonwealth Numbered Regulations - Explanatory Statements

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INSURANCE REGULATIONS (AMENDMENT) 1997 NO. 235

STATUTORY RULES 1997 NO. 235

Issued by the authority of the Assistant Treasurer

Insurance Act 1973

Insurance Regulations (Amendment)

The Insurance Act 1973 (the Act) and the Insurance Regulations (the Principal Regulations) establish a scheme of prudential supervision of the general insurance industry.

Section 132 of the Act provides that the Governor-General may make Regulations for the purposes of the Act.

Section 126 of the Act provides for secrecy in respect of information acquired for purposes of the Act. The Financial Laws Amendment Act 1997, which commenced on 30 June 1997, amended Section 126 such that information may be disclosed to prescribed financial sector supervisory agencies, law enforcement agencies and overseas financial sector supervisory agencies.

The regulations amend the Principal Regulations to prescribe financial sector supervisory agencies, law enforcement agencies and overseas financial sector supervisory agencies to whom a compliance officer, pursuant to Section 126 of the Act, may disclose protected information or documents acquired in the course of performing his or her duties.

Section 126 and the amendments to the Principal Regulations are aimed at facilitating the ability of the Insurance and Superannuation Commission to act quickly to exchange information to prevent and/or manage a crisis situation within financial conglomerates.

The regulations are described in detail in the attachment.

ATTACHMENT

Regulation 1- Amendment

Regulation 1 is explanatory, and includes a note that these regulations commence on gazettal.

Regulation 2 - New Regulations 30, 31 and 32

Regulation 2 inserts three new regulations, 30, 31 and 32 into the Principal Regulations, for the purposes of Section 126 of the Act.

Regulation 30 - Financial sector supervisory agency

Section 126 of the Act generally prohibits a compliance officer from disclosing protected information or producing protected documents, other than for the purposes of the Act or any other Act administered by the Insurance and Superannuation Commissioner, that have been acquired by the compliance officer in the course of performing his or her duties as a compliance officer.

Certain exceptions to this general rule are provided for in section 126. Paragraph 126(4)(c) provides that protected information may be disclosed, or protected documents produced, to a financial sector supervisory agency for the purposes of the performance of any of the agency's functions or the exercise of any of its powers.

'Financial sector supervisory agency' is defined in subsection 126(1) of the Act as meaning 'a person or body declared by the regulations to be a financial sector supervisory agency for the purposes of this section'.

Regulation 30 prescribes the financial sector supervisory agencies for the purposes of subsection 126(1) of the Act.

Regulation 31 - Law enforcement agency

Section 126 of the Act generally prohibits a compliance officer from disclosing protected information or producing protected documents, other than for the purposes of the Act or any other Act administered by the Insurance and Superannuation Commissioner, that have been acquired by the compliance officer in the course of performing his or her duties as a compliance officer.

Certain exceptions to this general rule are provided for in section 126. Paragraph 126(5)(a) and subsection 126(6) provide that protected information may be disclosed, or protected documents produced, to a law enforcement agency for the purposes of the performance by the agency of its functions in relation to an offence or alleged offence against a law of the Commonwealth, of a State or of a Territory.

'Law enforcement agency' is defined in subsection 126(1) of the Act as meaning 'a, person or body declared by the regulations to be a law enforcement agency for the purposes of this section'.

Regulation 31 prescribes the law enforcement agencies for the purposes of subsection 126(1) of the Act.

Regulation 32 - Overseas financial sector supervisory agency

Section 126 of the Act generally prohibits a compliance officer from disclosing protected information or producing protected documents, other than for the purposes of the Act or any other Act administered by the Insurance and Superannuation Commissioner, that have been acquired by the compliance officer in the course of performing his or her duties as a compliance officer.

Certain exceptions to this general rule are provided for in section 126. Paragraph 126(4)(d) provides that protected information may be disclosed, or protected documents produced, to an overseas financial sector supervisory agency for the purposes of the performance of any of the agency's functions or the exercise of any of its powers.

'Overseas financial sector supervisory agency' is defined in subsection 126(1) of the Act as meaning 'a person or body declared by the regulations to be an overseas financial sector supervisory agency for the purposes of this section'.

Regulation 30 prescribes the financial sector supervisory agencies for the purposes of subsection 126(1) of the Act.