Cheques and Payment Orders Regulations (Amendment) 1997 No. 276
EXPLANATORY STATEMENT
Statutory Rules 1997 No. 276
Issued by the Authority of the Treasurer
Cheques and Payment Orders Act 1986
Cheques and Payment Orders Regulations (Amendment)
Section 119 of the Cheques and Payment Orders Act 1986 (the Act) provides that the Governor-General may make regulations prescribing matters which are required or permitted by the Act to be prescribed.
The definition of a 'non-bank financial institution' in subsection 3(1) of the Act provides for the prescription of a registered corporation within the meaning of the Financial Corporations Act 1974 as a 'non-bank financial institution' for the purposes of that definition.
Section 100 of the Act regulates the use of certain 'agency' cheques issued by non-bank financial institutions and governs the rights and liabilities of non-bank financial institutions and their customers in relation to such cheques. In addition, section 98 of the Act allows nonbank financial institutions to take advantage of certain protections when collecting cheques for customers and section 97 imposes obligations on non-bank financial institutions to ensure that cheques lodged with them are presented promptly.
To date, four corporations, Westfarmers Limited, Elders Rural Finance Limited, Westralian Farmers Co-operative Limited and Dalgety Farmers Limited, have been prescribed as nonbank financial institutions under the Act.
A further corporation, Primac Elders Limited, has applied to be prescribed as a non-bank financial institution under the Act. Primac Elders Limited is a registered corporation within the meaning of Financial Corporations Act 1974.
The purpose of the proposed regulations is to prescribe Primac Elders Limited as a non-bank financial institution for the purposes of paragraph (b) of the definition of 'non-bank financial institution' in subsection 3(1) of the Act.
The proposed regulations also substitute the reference to Dalgety Farmers Limited in the Cheques and Payment Orders Regulations with a reference to Wesfarmers Dalgety Limited to reflect a name change.
Details of the proposed Regulations are set out in the Attachment.
The regulations commence on the date of gazettal.
ATTACHMENT
Regulation 1
Amendment
Regulation 1 provides that the regulations amend the Cheques and Payment Orders Regulations.
Regulation 2
Regulation 2 (Non-bank financial institution)
Regulation 2 omits existing regulation 2A and substitutes proposed new regulation 2A.
Under existing regulation 2A, which commenced on 19 April 1994 (Statutory Rules 1994 No 100), Westralian Farmers Co-operative Limited and Dalgety Farmers Limited were, each prescribed as a 'non-bank financial institution' for the purposes of the Act.
Under new regulation 2A, Primac Elders Limited will be listed in alphabetical order together with the four corporations, Elders Rural Finance Limited, Wesfarmers Limited, Westralian Farmers Co-operative Limited and Dalgety Farmers Limited, prescribed under existing regulation 2A.
New regulation 2A also amends the Cheques and Payment Orders Regulations by substituting the reference to Dalgety Farmers Limited with a reference to Wesfarmers Dalgety Limited to reflect a name change.
Each corporation will be prescribed by new regulation 2A as a 'non-bank financial institution' for the purposes of paragraph (b) of that definition in subsection 3(1) of the Act.
Overview
The Cheques and Payment Orders Regulations (Amendment) 1997 No. 276 was enacted to address the need to update the list of corporations prescribed as non-bank financial institutions under the Cheques and Payment Orders Act 1986. This amendment was necessary to incorporate Primac Elders Limited as a non-bank financial institution, reflecting its status as a registered corporation under the Financial Corporations Act 1974. Furthermore, the regulations also adjust the reference to Dalgety Farmers Limited to Wesfarmers Dalgety Limited, aligning with the company’s recent name change. The objective of these regulations, issued by the authority of the Treasurer, is to ensure the accuracy and currency of the prescribed entities, thereby maintaining the integrity and effectiveness of the regulatory framework governing cheques and payment orders. These amendments are intended to streamline the administration of cheque-related activities and uphold the statutory protections and obligations set forth in the Act.
Scope and Application
The Cheques and Payment Orders Regulations (Amendment) 1997 No. 276 applies to the definition of a 'non-bank financial institution' under the Cheques and Payment Orders Act 1986. This Act governs cheques and payment orders and is of a Commonwealth nature. The regulations amend the existing list of corporations prescribed as non-bank financial institutions to include Primac Elders Limited and update the name of Dalgety Farmers Limited to Wesfarmers Dalgety Limited, reflecting corporate changes. The amendment thus extends the application of the Act to these specific entities by prescribing them as non-bank financial institutions. The regulations do not exclude or exempt any particular entity or transaction from their purview and come into effect on the date of gazettal, as specified.
Key Provisions
The primary operative sections of the Cheques and Payment Orders Regulations (Amendment) 1997 No. 276 include Regulation 2, which prescribes Primac Elders Limited as a 'non-bank financial institution' and updates the name of Dalgety Farmers Limited to Wesfarmers Dalgety Limited. This amendment is made pursuant to section 119 of the Cheques and Payment Orders Act 1986, which allows the Governor-General to make regulations for matters required or permitted by the Act. Regulation 2 specifically addresses the definition of a 'non-bank financial institution' in subsection 3(1) of the Act, incorporating the prescribed corporations under this category.
The obligations imposed by these regulations primarily concern the entities prescribed as non-bank financial institutions. These institutions, now including Primac Elders Limited and Wesfarmers Dalgety Limited, must adhere to the provisions outlined in sections 97, 98, and 100 of the Act. Section 97 mandates that non-bank financial institutions ensure that cheques lodged with them are presented promptly. Section 98 allows these institutions to take advantage of certain protections when collecting cheques for their customers. Meanwhile, section 100 governs the use of certain 'agency' cheques issued by these institutions and their associated rights and liabilities.
In terms of consequences for breach, the Cheques and Payment Orders Regulations (Amendment) 1997 No. 276 does not explicitly state penalties for non-compliance with the regulations. However, non-compliance with the underlying Cheques and Payment Orders Act 1986 may result in civil or criminal consequences. Under section 102 of the Act, a person who contravenes certain sections may be liable for a civil penalty, which could be significant depending on the nature and severity of the breach. Additionally, section 103 imposes potential criminal penalties for fraudulent behaviour related to cheques and payment orders, which can include substantial fines and imprisonment. These penalties underscore the importance of compliance with the regulatory framework governing non-bank financial institutions.