Acts of Parliament assented to - Act No. 43 to 59 of 2017

Overview

The Australian Parliament enacted the ASIC Supervisory Cost Recovery Levy Act 2017 to address the financial sustainability of the Australian Securities and Investments Commission (ASIC), the regulatory body responsible for overseeing financial markets and ensuring compliance with financial laws. This legislation was introduced to establish a levy on entities regulated by ASIC, ensuring that the organisation could effectively fund its regulatory activities without relying solely on government appropriations. The policy objective was to provide ASIC with a more reliable and predictable funding source, enabling it to maintain and enhance its regulatory functions. The ASIC Supervisory Cost Recovery Levy (Collection) Act 2017 and the ASIC Supervisory Cost Recovery Levy (Consequential Amendments) Act 2017 were also enacted concurrently to facilitate the implementation and integration of the levy system into existing legal frameworks.

Scope and Application

The ASIC Supervisory Cost Recovery Levy Act 2017 applies to entities that are regulated by the Australian Securities and Investments Commission (ASIC). This includes a wide range of financial services entities, such as financial services licensees, responsible managers, and credit licensees, among others. The geographic reach of this Act is Commonwealth-wide, impacting entities across Australia. The Act imposes a levy on these entities to cover the costs incurred by ASIC in performing its regulatory functions. Exclusions and exemptions from the levy may be specified in subordinate legislation or regulations that extend or further define the application of the Act. The ASIC Supervisory Cost Recovery Levy (Collection) Act 2017 complements the primary Act by providing the mechanisms for the collection of the levy imposed under the ASIC Supervisory Cost Recovery Levy Act 2017, ensuring that the regulatory costs are effectively recovered from the entities involved.

Key Provisions

The ASIC Supervisory Cost Recovery Levy Act 2017 (section 4) imposes a levy on persons regulated by the Australian Securities and Investments Commission (ASIC). This levy is intended to recover costs associated with ASIC’s regulatory activities, ensuring that the financial burden of regulating the financial sector is shared equitably by the entities subject to ASIC’s oversight. The levy is calculated based on the financial size of the regulated entity, reflecting the principle that larger entities bear a proportionate share of the costs. The ASIC Supervisory Cost Recovery Levy (Collection) Act 2017 (section 5) outlines the mechanisms for collecting these levies, establishing the procedures and timeframes for assessment and payment, and ensuring that the collection process is efficient and transparent. The obligations imposed by these Acts on regulated entities include timely reporting of relevant financial information to ASIC, necessary for the accurate calculation of the levy (section 6). Entities must ensure they meet their obligations under these Acts by providing accurate and complete financial data within the specified deadlines. Failure to comply with these reporting requirements can result in penalties and interest charges on the unpaid levy. Furthermore, the ASIC Supervisory Cost Recovery Levy (Consequential Amendments) Act 2017 (section 7) ensures that existing legislation is updated to accommodate the new levy, avoiding any legal ambiguities or inconsistencies. In terms of consequences for non-compliance, the Acts establish both administrative and financial penalties. For instance, under the ASIC Supervisory Cost Recovery Levy Act 2017, failure to pay the levy when due can result in substantial financial penalties, including interest and additional charges (section 8). Additionally, repeated non-compliance or significant breaches may lead to more severe consequences, such as ASIC taking legal action against the entity. The severity of penalties is intended to encourage compliance and ensure that the regulatory costs are effectively recovered.