Explanatory Statement
Statutory Rules 1990, No. 266
Issued by Authority of the Treasurer
Amendment of the Banking (Foreign Exchange) Regulations
Section 39 of the Banking Act 1959 provides that, where the Governor General considers it expedient to do so, he may make regulations for purposes related to:
(a) foreign exchange or the foreign exchange resources of Australia;
(b) the protection of the currency or the protection of the public credit or revenue of Australia; or
(c) foreign investment in Australia, Australian investment outside Australia, foreign ownership or control of property in Australia or of Australian property outside Australia or Australian ownership or control of property outside Australia or of foreign property in Australia.
The Banking (Foreign Exchange) Regulations are administered by the Reserve Bank of Australia on behalf of the Government.
On 6 August 1990 the Government announced a package of wide-ranging sanctions against Iraq in response to its invasion of Kuwait. Subsequently, the United Nations Security Council adopted a resolution which requires members of the United Nations to implement economic measures against Iraq and to protect the assets of the legitimate Government of Kuwait and its agencies.
The Banking (Foreign Exchange) Regulations provide the Reserve Bank with powers which may be used to protect the assets of the legitimate government of Kuwait and to restrict transfers of funds from residents of Australia to residents of Iraq and Kuwait. The amendment to the Regulations would ensure that they may be used to give effect to the Government’s announcement in respect of Iraq and to meet Australia’s obligations under the Security Council resolution.