EXPLANATORY STATEMENT
 

Issued by authority of the Minister for Home Affairs

under the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024

Anti-Money Laundering and Counter-Terrorism Financing Transitional Amendment (Reporting Obligations) Rules 2026

Legislative authority

The Anti-Money Laundering and Counter-Terrorism Financing Transitional Amendment (Reporting Obligations) Rules 2026 (Transitional Amendment Rules) are made by the Minister for Home Affairs under Schedule 12 of the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 (AML/CTF Amendment Act).

Schedule 12 provides that the Minister may, by legislative instrument, make rules prescribing matters of a transitional nature (including prescribing any saving or application provisions) relating to the amendments or repeals made by the AML/CTF Amendment Act. This modification power is limited to four years beginning on the commencement of Schedule 12 of the AML/CTF Amendment Act to address unforeseen issues that arise after enactment.

purpose

The Transitional Amendment Rules make administrative amendments to the Anti-Money Laundering and Counter-Terrorism Financing Transitional Rules 2026 (Transitional Rules) to ensure the effective operation of the ‘Modification of reporting obligations before IVTS reporting transition date’ rules under section 10 of the Transitional Rules. The Transitional Amendment Rules also ensure that subsection 10(5) applies to international funds transfer instruction (IFTI) reports provided from 31 March 2026 onwards, including reports given before or after commencement of the amendment.

The Transitional Amendment Rules are distinct from the Anti-Money Laundering and Counter-Terrorism Financing Rules 2025 (AML/CTF Rules) made by the Australian Transaction Reports and Analysis Centre (AUSTRAC) Chief Executive Officer (CEO) and are separate from any further amendments to the AML/CTF Rules that may be made by AUSTRAC.

background

The Transitional Rules make transitional provisions under the AML/CTF Amendment Act, which amended the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act). The Transitional Rules are intended to support implementation of the reforms introduced under the AML/CTF Amendment Act. The Transitional Rules will allow periods of time for reporting entities to adjust their business and processes to comply with certain obligations, while still managing their money laundering and terrorism financing risk.

consultation

The Transitional Amendment Rules were informed by consultation with AUSTRAC, who support the amendments.

detail and operation

The Transitional Amendment Rules are a legislative instrument for the purposes of the Legislation Act 2003. The Transitional Amendment Rules commence on the day after the instrument is registered.

Details of the Instrument are set out in Attachment A.

A Statement of Compatibility with Human Rights (the Statement) is at Attachment B. The Statement was completed in accordance with the Human Rights (Parliamentary Scrutiny) Act 2011. The Instrument is compatible with human rights as it does not raise any human rights issues.

Attachment A

Details of the Anti-Money Laundering and Counter-Terrorism Financing Transitional Amendment (Reporting Obligations) Rules 2026

Section 1 Name

1.        Section 1 provides that the name of the instrument is the Anti-Money Laundering and Counter-Terrorism Financing Transitional Amendment (Reporting Obligations) Rules 2026.

Section 2  Commencement

1.        Section 2 provides that the instrument commences on the day after the instrument is registered.

Section 3 Authority

1.        Section 3 notes that the instrument is made under the Anti-Money Laundering and Counter‑Terrorism Financing Amendment Act 2024.

Section 4 Schedules

1.        Section 4 provides that each instrument that is specified in the Schedules to this instrument is amended or repealed as set out in the applicable items in the Schedules, and any other item in a Schedule to this instrument has effect according to its terms.

Schedule 1—Amendments

Item 1  Subsection 10(5)

1.        Part 4 of the Transitional Rules delays the commencement of the IVTS reporting framework and retains the existing IFTI reporting framework, and its operation, until the commencement of the IVTS framework. As noted in the Explanatory Statement to the Transitional Rules, reporting entities that were subject to IFTI reporting obligations as at 30 March 2026 will continue to submit IFTI reports until they transition to the new IVTS reporting framework. Accordingly, Part 4 is intended to preserve the operation of sections relevant to the existing IFTI reporting regime.
2.        Current subsection 10(5) of the Transitional Rules provides that section 48A of the Principal Act (being the AML/CTF Act), which deals with amending or withdrawing reports, is taken to apply to information communicated to the AUSTRAC CEO in accordance with section 10 of the Transitional Rules. Given that section 48A deals with amending and withdrawing IVTS reports, and not IFTI reports, subsection 10(5) does not enable the AUSTRAC CEO to request that a reporting entity amend or withdraw an IFTI report made for the purposes of this subsection.
3.        This item amends subsection 10(5) of the Transitional Rules to omit ‘Section 48A of the Principal Act’ and replace it with reference to ‘Division 3A of Part 9 of the Anti‑Money Laundering and Counter-Terrorism Financing Rules 2025’.
4.        Division 3A of Part 9 of the AML/CTF Rules is made for the purposes of subsection 48A(1) of the AML/CTF Act and relates to the amending or withdrawing of reports. Section 9-9B of the AML/CTF Rules provides that a report can only be amended or withdrawn if requested by the AUSTRAC CEO.
5.        Referring to Division 3A of Part 9 of the AML/CTF Rules means that if the AUSTRAC CEO amends this Division in the future, the amendments will be applied to reports of the type that are made under the Transitional Rules.
6.    This amendment is administrative in nature and will ensure the effective operation of section 10 of the Transitional Rules.

Item 2  At the end of the instrument

1.    This item inserts, at the end of the Transitional Rules, a new Part 10 that sets out application, saving and transitional provisions for the amendments made by the Transitional Amendment Rules.
2.    New section 21 provides that subsection 10(5) of the Transitional Rules, as amended by the Transitional Amendment Rules, applies in relation to a report given to the AUSTRAC CEO whether the report was given before or after the amendment commenced.
3.    This will ensure that the AUSTRAC CEO may request for any IFTI report to be amended or withdrawn if it relates to a report given on or after 31 March 2026, consistent with the commencement of the Transitional Rules.

ATTACHMENT B

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Anti-Money Laundering and Counter-Terrorism Financing Transitional Rules 2026

This Disallowable Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Disallowable Legislative Instrument

The Anti-Money Laundering and Counter-Terrorism Financing Transitional Amendment (Reporting Obligation) Rules 2026 (Transitional Amendment Rules) are made by the Minister for Home Affairs under Schedule 12 of the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act (AML/CTF Amendment Act). Schedule 12 provides that the Minister may, by legislative instrument, make rules prescribing matters of a transitional nature (including prescribing any saving or application provisions) relating to the amendments or repeals made by the AML/CTF Amendment Act. This modification power is limited to four years to address unforeseen issues that arise after enactment.

The Transitional Amendment Rules make administrative amendments to ensure the effective operation of the ‘Modification of reporting obligations before IVTS reporting transition date’ rules under Section 10 of the Transitional Rules. The Transitional Amendment Rules also ensure that subsection 10(5) applies to international funds transfer instruction (IFTI) reports provided before or after the amendment commenced.

Human rights implications

This Disallowable Legislative Instrument does not engage any of the applicable rights or freedoms.

Conclusion

This Disallowable Legislative Instrument is compatible with human rights as it does not raise any human rights issues.

The Hon Tony Burke MP

Minister for Home Affairs