Australian Securities and Investments Commission
Corporations Act 2001 — Subsections 655A(1), 669(1) and 673(1) — Variation
Under subsections 655A(1), 669(1) and 673(1) of the Corporations Act 2001 (the “Act”) and with effect from the commencement of Schedule 1 to the Financial Services Reform Act 2001, the Australian Securities and Investments Commission hereby varies Class Order [01/1542] by:
1. omitting from subparagraph 2(c):
(a) the words “providing financial services” (twice occurring) and substituting the words “the provision of financial accommodation by any means”; and
(b) the words “financial services provided” and substituting the words “financial accommodation provided”;
2. omitting from paragraph 3:
(a) the words “securities dealer” and substituting the words “financial services licensee”; and
(b) the word “dealer’s securities business” and substituting the words “licensee’s financial services business”; and
3. omitting from paragraph 6:
(a) the words “providing financial services” (thrice occurring) and substituting the words “the provision of financial accommodation by any means”; and
(b) the words “financial services provided” and substituting the words “financial accommodation provided”.
Dated this 4th day of March 2002
Signed by Brendan Byrne
as a delegate of the Australian Securities and Investments Commission
Overview
The Australian Securities and Investments Commission Corporations Act 2001 was enacted to address the need for comprehensive regulation of financial markets and services in Australia. This Act aimed to streamline and modernise the regulatory framework for financial services, addressing gaps in previous legislation and providing a more robust legal foundation for the supervision and enforcement of financial market activities. The Act was passed by the Parliament of Australia, with a policy objective to enhance investor protection, promote market integrity, and maintain confidence in the financial system. The legislative instrument, F2006B01593, issued under the authority of the Act, concerns specific variations to Class Order [01/1542]. These variations, effective from the commencement of Schedule 1 to the Financial Services Reform Act 2001, involve rephrasing certain terms related to financial services and financial accommodation to align with the updated regulatory terminology and scope of the Corporations Act 2001.
Scope and Application
The Australian Securities and Investments Commission Corporations Act 2001, through the legislative instrument F2006B011593, modifies Class Order [01/1542] by adjusting specific language to clarify the scope and application of financial services regulation. This variation applies to the provision of financial accommodation by any means and specifically pertains to entities and persons involved in financial services, particularly those who hold a financial services licence. The alterations in terminology from "providing financial services" to "the provision of financial accommodation by any means" and from "financial services provided" to "financial accommodation provided" reflect a broader jurisdictional reach, encompassing various forms of financial transactions. This change is effective under subsections 655A(1), 669(1), and 673(1) of the Corporations Act 2001, impacting the conduct and transactions of financial services licensees. The Act applies nationwide, impacting both Commonwealth and state jurisdictions, and aims to ensure consistency in the regulation of financial services businesses. This legislative instrument provides clarity and precision in defining the scope of financial services regulation, ensuring that the relevant provisions are applicable to all relevant entities and transactions across Australia.
Key Provisions
The key provisions of this legislative instrument, found in subsections 655A(1), 669(1) and 673(1) of the Corporations Act 2001, involve specific variations to Class Order [01/1542]. These variations adjust the terminology within the order, replacing instances of “providing financial services” and “financial services provided” with “the provision of financial accommodation by any means” and “financial accommodation provided” respectively. Additionally, the term “securities dealer” is replaced with “financial services licensee” and “dealer’s securities business” with “licensee’s financial services business”. These changes aim to align the language within the order to more accurately reflect the current regulatory environment and terminology related to financial services.
The obligations imposed by these provisions on the parties or entities governed by the Act are primarily related to the adaptation of their terminology and business descriptions to comply with the updated language specified in the variations. Financial services licensees and other entities subject to Class Order [01/1542] must ensure that their documentation, disclosures, and operational descriptions reflect the changes as outlined in the variations. This includes using the term “financial accommodation” instead of “financial services” and adjusting any related references accordingly. The intent is to maintain clarity and consistency in the regulatory framework, ensuring that all stakeholders are operating under the same understanding of key terms.
Failure to comply with the updated terminology and the specific changes mandated by the variations could result in various consequences. While the specific legislative instrument does not detail civil or criminal penalties for non-compliance, breaches of the Corporations Act 2001 provisions can generally lead to significant legal repercussions. Under the Corporations Act, breaches can result in fines, imprisonment, or both, depending on the severity and intent behind the non-compliance. The maximum penalties can vary widely, depending on the specific provision breached and the circumstances of the offence, but can include substantial fines for corporations and potential imprisonment for individuals responsible for the oversight of compliance. Therefore, it is crucial for entities governed by the Act to adhere strictly to the variations and ensure their practices are in line with the updated legal requirements.