Australian Securities Commission Regulations (Amendment) 1994 No. 301
EXPLANATORY STATEMENT
Statutory Rules 1994 No. 301
Issued by the Authority of the Attorney-General
Australian Securities Commission Act 1989
Australian Securities Commission Regulations (Amendment)
Section 251 of the Australian Securities Commission Act 1989 (the Act) empowers the GovernorGeneral to make regulations not inconsistent with the Act prescribing matters:
(a) required or permitted by the Act (other than the non-applied provisions) to be prescribed by regulations., or
(b) necessary or convenient to be prescribed by such regulations for carrying out or giving effect to the Act (other than the non-applied provisions).
The 'non-applied' provisions are specified in section 5 of the Act and are not relevant for present purposes.
The purpose of the accompanying Regulations is to amend the Australian Securities Commission Regulations (the ASC Regulations) to specify certain bodies corporate to which the Australian Securities Commission (ASC) may disclose information.
Details of the accompanying Regulations are as follows.
Regulation 1 : Amendment
This regulation provides that the Regulations amend the Australian Securities Commission Regulations.
Regulation 2: New regulation 8A
This regulation inserts a new regulation 8A after regulation 8. The amendment provides that the bodies corporate listed in Schedule 3 of the Regulations are specified for the purposes of subsection 127(4C) of the Act.
Subsection 127(1) of the Act provides that the ASC shall take all reasonable measures to protect from unauthorised use or disclosure information given to it in confidence or in connection with the performance of its functions or the exercise of its powers under a national scheme law. 'National scheme law' is defined in section 5 of the Act to mean the Act, the Corporations Law of the Australian Capital Territory and the Corporations Act 1989 and corresponding Corporations Acts and Laws in the States and the Northern Territory.
As a result of amendments made by the Corporate Law Reform Act 1994, which will commence operation on 5 September 1994 as a result of subsection 2(3) of that Act, new subsection 127(4B) provides that the disclosure of information by the ASC to a body corporate specified in regulations under subsection (4C) is authorised use and disclosure of the information if the Chairman of the ASC is satisfied that the information will enable or assist the body corporate to monitor compliance with, enforce, or perform its functions or exercise its powers under the Corporations Law or its business rules or listing rules.
New subsection 1.27(4C) provides that the regulations may specify a body corporate for the purposes of subsection (4B) if, and only if, the body corporate conducts a stock market or a futures market or is the securities clearing house or a clearing house for a futures exchange.
Regulation 3 : New Schedule 3
Subregulation 3.1 inserts a new Schedule 3 after Schedule 2. The new Schedule specifies the bodies corporate to which the ASC may disclose information for the purposes of subsection 127(4C) of the Act.
These bodies are:
(a) ASX Futures Exchange Pty Ltd, a subsidiary of Australian Stock Exchange Limited, which has approval under section 1126 of the Corporations Law to conduct a futures market;
(b) ASX Settlement and Transfer Corporation Pty Ltd, the clearing house for Australian Stock Exchange Limited;
(c) Australian Stock Exchange Limited, which conducts a stock market;
(d) Options Clearing House Pty Limited, the clearing house for the Australian Options Market of the Australian Stock Exchange Limited;
(e) Sydney Futures Exchange Clearing House Pty Limited, the clearing house for Sydney Futures Exchange Limited,
(f) Sydney Futures Exchange Limited, which conducts a futures market.
Overview
The Australian Securities Commission Regulations (Amendment) 1994, Statutory Rules 1994 No. 301, were enacted under the authority of the Attorney-General and pursuant to section 251 of the Australian Securities Commission Act 1989. The primary purpose of this amendment is to address the need for the Australian Securities Commission (ASC) to disclose certain confidential information to specific bodies corporate, in line with the requirements of the amended national scheme laws. The regulations specify certain bodies corporate to which the ASC may disclose information, enabling them to monitor compliance with, enforce, or perform their functions or exercise their powers under the Corporations Law or their business rules or listing rules. This amendment reflects the policy objective of facilitating effective oversight and regulation of the financial markets, while ensuring that sensitive information is disclosed only to authorised entities.
Scope and Application
The Australian Securities Commission Regulations (Amendment) 1994 No. 301, issued under the Australian Securities Commission Act 1989, amends the Australian Securities Commission Regulations to specify certain bodies corporate to which the Australian Securities Commission may disclose information. This amendment applies to entities involved in stock markets, futures markets, and clearing houses for such markets, specifically entities that conduct or clear these markets. The amendment is necessary to allow the Australian Securities Commission to share information with these bodies to enable them to monitor compliance with, enforce, or perform their functions or exercise their powers under Corporations Law or their business rules or listing rules. The amendment applies to specific corporations listed in Schedule 3 of the Regulations, including ASX Futures Exchange Pty Ltd, ASX Settlement and Transfer Corporation Pty Ltd, Australian Stock Exchange Limited, Options Clearing House Pty Limited, and Sydney Futures Exchange Clearing House Pty Limited and Sydney Futures Exchange Limited. The regulations ensure that the disclosure of confidential information is authorised and authorised use or disclosure of the information if the Chairman of the Australian Securities Commission is satisfied that the information will enable or assist these specified bodies to perform their functions or exercise their powers. The regulations extend the application of the Act by specifying additional entities through subordinate instruments, thus broadening the scope of authorised information disclosure under certain conditions.
Key Provisions
The Australian Securities Commission Regulations (Amendment) 1994 No. 301 amends the Australian Securities Commission Regulations to specify certain bodies corporate to which the Australian Securities Commission (ASC) may disclose information. The primary sections that facilitate this are Regulation 2, which introduces a new regulation 8A, and Regulation 3, which introduces a new Schedule 3. Regulation 2 inserts a new regulation 8A into the ASC Regulations, specifying the bodies corporate listed in Schedule 3 that the ASC can disclose information to for the purposes of subsection 127(4C) of the Australian Securities Commission Act 1989 (the Act). Regulation 3 creates a new Schedule 3 that lists these bodies, ensuring compliance with the Act's requirements for authorised disclosure.
The obligations imposed on the ASC by the amended regulations include taking all reasonable measures to protect confidential information received under the Act, as stipulated in subsection 127(1). The ASC must also ensure that any disclosure of this information to specified bodies corporate is authorised under new subsection 127(4B). This means that the Chairman of the ASC must be satisfied that the disclosure will enable or assist the specified body corporate to monitor compliance with, enforce, or perform its functions or exercise its powers under the relevant Corporations Law or business rules. The specified bodies corporate must meet the criteria outlined in new subsection 127(4C), which requires them to conduct a stock market, a futures market, or be a clearing house for a futures exchange.
Failure to comply with the requirements of the amended regulations can result in various consequences, although the specific penalties are not detailed in the explanatory statement. Breaches of the Act's provisions regarding the protection and disclosure of information could potentially lead to civil or criminal penalties, depending on the nature and severity of the breach. The maximum penalties for such breaches are not explicitly stated in the explanatory statement, but they could include fines or imprisonment under the relevant legislative framework.