Banking (Foreign Exchange) Regulations 1959 - Exemption (subregulation 34(1)) (21/06/1984)

Overview

The Banking (Foreign Exchange) Regulations Exemption F2006B11736, enacted in 1984, was introduced by the Reserve Bank of Australia in order to amend existing regulations concerning foreign exchange transactions. This legislative instrument revokes a previous exemption dated 30 August 1973 and replaces it with new provisions that exempt certain activities involving foreign securities from specific regulatory requirements. The objective is to provide relief to individuals and residents involved in transactions with foreign securities, both within and outside Australia, while maintaining oversight and control over such financial activities through the Reserve Bank of Australia. The instrument came into operation on 25 June 1984, signifying a shift in the regulatory approach towards foreign exchange transactions involving securities.

Scope and Application

The Banking (Foreign Exchange) Regulations, as amended by the Legislative Instrument F2006B11736, primarily address the exemptions from certain regulatory requirements concerning foreign exchange transactions within Australia. Specifically, the Regulations exempt certain transactions involving foreign securities from the purview of sub-regulation 34(1). This exemption applies to any individual who engages in the buying, borrowing, selling, lending, or exchanging of foreign securities located within Australia, as well as any person acting on behalf of another individual in such transactions. Additionally, it exempts residents of Australia, or persons acting on behalf of a resident, who engage in similar activities involving foreign securities that are situated outside Australia. These exemptions are intended to streamline certain foreign exchange operations and reduce bureaucratic hurdles for affected individuals and entities. The instrument revokes a previously established exemption dated 30 August 1973, replacing it with the current provisions, which came into operation on 25 June 1984.

Key Provisions

The main operative sections of the Banking (Foreign Exchange) Regulations Exemption, dated 21 June 1984, include the revocation of an exemption dated 30 August 1973 (section 1) and the establishment of new exemptions from the application of sub-regulation 34(1) (section 2). Specifically, section 1 revokes an earlier exemption, while section 2 introduces new exemptions for certain activities involving foreign securities. Under section 2(a), any person buying, borrowing, selling, lending, or exchanging foreign securities in Australia, or dealing with such securities in Australia, is exempt from sub-regulation 34(1). Additionally, section 2(b) exempts any resident, or any person acting on behalf of a resident, from sub-regulation 34(1) when buying, borrowing, selling, lending, or exchanging foreign securities outside Australia, or dealing with such securities outside Australia. The obligations and requirements imposed by the Act are primarily concerned with the activities of individuals and entities involved in the buying, borrowing, selling, lending, or exchanging of foreign securities. The exemptions detailed in section 2 mean that certain transactions involving foreign securities are not subject to the requirements of sub-regulation 34(1). This includes transactions taking place both within Australia and overseas. Essentially, the Act removes specific regulatory burdens from those involved in foreign securities transactions, provided they fall under the exemptions outlined in section 2. Regarding potential breaches and the associated consequences, the Act itself does not explicitly detail offences, penalties, or consequences for non-compliance with the exemptions. However, the Banking (Foreign Exchange) Regulations, of which this exemption is a part, may contain provisions for penalties in the event of non-compliance. Typically, breaches of banking and financial regulations in Australia can result in both civil and criminal penalties, depending on the nature and severity of the breach. Civil penalties might include fines, while criminal penalties could result in imprisonment, particularly if the breach is deemed to be of a serious nature or involves intentional misconduct. The exact penalties would be determined in accordance with the broader regulatory framework governing the Banking (Foreign Exchange) Regulations.