Overview

The Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2005 was enacted to address the allocation of levy revenue towards the costs incurred by the Commonwealth in providing market integrity and consumer protection functions for prudentially regulated institutions. This determination was made under the authority granted by subsection 50(1) of the Australian Prudential Regulation Authority Act 1998, enabling the Treasurer to specify the amount of levy revenue available for this purpose. The determination came into effect on 1 July 2005, for the 2005-06 financial year, and superseded the Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2004. The primary objective of this legislation is to allocate specific amounts of levy revenue under various financial sector levy imposition Acts to the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO) to support their activities in ensuring market integrity and consumer protection for prudentially regulated institutions. This allocation is intended to cover the costs associated with these functions, thereby ensuring the efficient operation of the regulatory framework.

Scope and Application

The Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2005 applies to the allocation of levy revenue collected from prudentially regulated institutions to cover the Commonwealth's costs for market integrity and consumer protection functions provided by the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO). This determination specifies the amounts of levy revenue to be retained for these purposes for the 2005-06 financial year, replacing the Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2004. The funds are allocated under various financial sector levy imposition Acts, with specified amounts directed to ASIC and the ATO for their respective roles in overseeing and protecting consumers within the prudentially regulated sectors. The determination specifies the exact amounts allocated to each agency under each levy imposition Act, ensuring clarity on the financial resources available for these regulatory activities. It is a disallowable instrument under section 46A of the Acts Interpretation Act 1901, meaning its validity can be challenged and annulled through parliamentary scrutiny.

Key Provisions

The Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2005, made under section 50(1) of the Australian Prudential Regulation Authority Act 1998, sets out the allocation of levy revenue to cover the costs of providing market integrity and consumer protection functions for prudentially regulated institutions. This determination, which took effect on 1 July 2005 for the 2005-06 financial year, specifies the amounts to be retained from various financial sector levies and allocated to the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO). For example, the Authorised Deposit-taking Institutions Supervisory Levy Imposition Act 1998 allocates $2,210,000 to ASIC, while the Superannuation Supervisory Levy Imposition Act 1998 allocates $9,144,000 to ASIC and $2,945,000 to the ATO. These funds are intended to support the activities of ASIC and the ATO in performing their respective functions for the Commonwealth. Entities such as ASIC and the ATO are subject to specific obligations under this Determination. They must use the allocated funds solely for activities related to providing market integrity and consumer protection services for prudentially regulated institutions. This includes using the funds for operational expenses, personnel costs, and other related expenditures necessary to carry out these functions effectively. The determination ensures that the levy revenue is appropriately directed to support the mandated activities, thereby maintaining the integrity of the financial markets and protecting consumers. Failure to comply with the provisions of this determination may lead to various consequences, including financial penalties. While the determination itself does not explicitly detail penalties for non-compliance, breaches of related legislation or regulatory requirements could attract penalties under other Acts. For instance, breaches of the Australian Prudential Regulation Authority Act 1998 or any of the levy imposition Acts could result in significant fines. In addition, civil or criminal liability may arise depending on the nature and severity of the breach, with penalties varying according to the specific Act and the jurisdiction in which the breach occurs.