ASIC CLASS ORDER [CO 11/519]
EXPLANATORY STATEMENT
Prepared by the Australian Securities and Investments Commission
Corporations Act 2001
The Australian Securities and Investments Commission (ASIC) makes ASIC Class
Order [CO 11/519] under paragraphs 601QA(1)(a) and 911A(2)(l) of the Corporations Act 2001 (the Act).
Paragraph 601QA(1)(a) of the Act provides that ASIC may exempt a class of persons from the provisions of Chapter 5C of the Act.
Paragraph 911A(2)(l) of the Act provides that ASIC may exempt a class of persons from the requirement to hold an Australian financial services licence (AFS licence).
1. Background
ASIC Class Order [CO 08/1], the principal class order, gives conditional relief from the AFS licensing regime and Chapter 5C of the Act for some group purchasing bodies (GPBs) who arrange or hold risk management products (insurance) for the benefit of third parties. GPBs include sporting and other not-for-profit organisations which arrange insurance for third parties (e.g. players or volunteers).
ASIC Class Order [CO 08/1] provides conditional relief to a limited class of
GPBs that organise insurance on a non-commercial basis. The transitional period for compliance with the breach reporting conditions in [CO 08/1] was scheduled to end on 30 June 2011.
Treasury has indicated to ASIC that it may be appropriate for the regulation of GPBs and the terms of any exemption to be addressed by regulation. Treasury is still consulting on the issue.
2. Purpose of the class order
ASIC Class Order [CO 11/519], an amending class order, extends the transitional period for compliance with the breach reporting conditions in [CO 08/1] by another 6 months while Treasury consults on the issue. That is, until the first time that the body acquires, renews or renegotiates the terms of, the risk management product on or after 31 December 2011 but before 31 December 2012.
3. Operation of the class order
Paragraph 4 of the amending class order amends [CO 08/1] by substituting ‘31 December 2011’ in place of ‘30 June 2011’ and substituting '31 December 2012' in place of '30 June 2012' in subparagraphs 10(f)(i) and (ii), respectively. This means that on or after 31 December 2011, GPBs relying on relief under [CO 08/1] will need to report any breaches of the conditions of [CO 08/1] to ASIC under subparagraph 10(f) but by no later than 31 December 2012.
4. Consultation
In preparing [CO 11/519] ASIC has taken account of Treasury's consultation process.