EXPLANATORY STATEMENT
Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2008
Subsection 50(1) of the Australian Prudential Regulation Authority Act 1998 enables the Minister to make a determination on the amount of levy revenue that is to be available to cover the costs to the Commonwealth of providing market integrity and consumer protection functions for prudentially regulated institutions. This can be done either by specifying one retainable amount or by specifying a retainable amount for each class of levy.
This determination commences on 1 July 2008 and relates to the 2008‑09 financial year. The Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2007 is revoked upon commencement of this determination.
This determination states the amount of levy revenue allocated under each of the various levy imposition Acts to the Australian Securities and Investments Commission (ASIC) and to the Australian Taxation Office (ATO) in 2008‑09. These funds are allocated to ASIC and ATO activities in so far as those agencies provide, on behalf of the Commonwealth, relevant market integrity and consumer protection functions for prudentially regulated institutions. They will contribute towards the costs of ASIC and the ATO undertaking those functions.
The following table details the amounts allocated to activities undertaken by ASIC and the ATO under each of the financial sector levy imposition Acts.
Legislation | Allocated to ASIC ($) | Allocated to ATO ($) |
Authorised Deposit-taking Institutions Supervisory Levy Imposition Act 1998 | 2,300,000 | 0 |
Authorised Non-operating Holding Companies Supervisory Levy Imposition Act 1998 | 0 | 0 |
General Insurance Supervisory Levy Imposition Act 1998 | 1,500,000 | 0 |
Life Insurance Supervisory Levy Imposition Act 1998 | 1,800,000 | 0 |
Retirement Savings Account Providers Supervisory Levy Imposition Act 1998 | 0 | 0 |
Superannuation Supervisory Levy Imposition Act 1998 | 9,000,000 | 6,400,000 |
Total | 14,600,000 | 6,400,000 |
The finance sector has been consulted on the 2008‑09 supervisory levies, including the allocation of costs to ASIC and the ATO, through a Treasury and Australian Prudential Regulation Authority Consultation Paper released on 28 May 2008 and a number of follow-up meetings to discuss the issues in the paper.
This determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Overview
The Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2008 was enacted to specify the amount of levy revenue allocated to cover the costs of providing market integrity and consumer protection functions for prudentially regulated institutions by the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO) for the 2008–09 financial year. The Australian Prudential Regulation Authority Act 1998 empowered the Minister to make this determination, which came into effect on 1 July 2008 and revoked the 2007 equivalent. The policy objective of this determination was to allocate specific funds under various financial sector levy imposition Acts to ASIC and ATO to support their activities in providing relevant services on behalf of the Commonwealth. This determination reflects the outcome of consultations with the finance sector, facilitated by the Treasury and the Australian Prudential Regulation Authority, aimed at ensuring a clear and equitable allocation of costs associated with prudential supervision.
Scope and Application
The Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2008 applies to the allocation of funds derived from various financial sector levies to the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO) for the financial year 2008-09. This determination is made under the authority granted by subsection 50(1) of the Australian Prudential Regulation Authority Act 1998, which allows the Minister to specify the amount of levy revenue available to cover the Commonwealth's costs of providing market integrity and consumer protection functions for prudentially regulated institutions. The determination revokes the Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2007 and details the allocation of funds under each of the financial sector levy imposition Acts, contributing to the costs incurred by ASIC and the ATO in undertaking their specified functions. This legislation pertains specifically to the Commonwealth and its financial regulatory agencies, focusing on the distribution of funds derived from financial sector levies to support their operational costs.
Key Provisions
The Australian Prudential Regulation Authority (Commonwealth Costs) Determination 2008 (No. 1) (F2008L02365) specifies the allocation of levy revenues for the financial year 2008-09 to cover the costs of providing market integrity and consumer protection functions for prudentially regulated institutions. Under subsection 50(1) of the Australian Prudential Regulation Authority Act 1998, this determination allocates specific amounts to the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO) from various levy imposition acts. The determination outlines the amounts to be allocated from different financial sector levies, such as the Authorised Deposit-taking Institutions Supervisory Levy Imposition Act 1998, General Insurance Supervisory Levy Imposition Act 1998, and others, with total allocations of $14,600,000 to ASIC and $6,400,000 to the ATO.
The Act imposes specific obligations on the entities it governs by detailing the financial allocations from each levy to ASIC and the ATO. This involves ensuring that the specified amounts from each levy are properly collected and directed to the respective agencies. The funds are intended to support the activities of ASIC and the ATO in providing market integrity and consumer protection functions on behalf of the Commonwealth for prudentially regulated institutions. This allocation is crucial for ensuring that these agencies can effectively perform their regulatory duties without additional financial strain on the Commonwealth.
Breaches of the provisions in this determination could potentially lead to civil or administrative penalties, although the specific offences and penalties are not detailed in this particular determination. Typically, such breaches might involve failure to comply with the specified allocations or misuse of the allocated funds. The penalties could vary based on the nature and severity of the breach but would generally be enforced under the relevant Acts governing the financial sector and administrative law. The consequences of non-compliance could include financial penalties, corrective actions, or other administrative measures to ensure adherence to the determination's requirements.