Corporations (Fees) Amendment Regulations 2001 (No. 1) 2001 No. 320
EXPLANATORY STATEMENT
Statutory Rules 2001 No. 320
Issued by the authority of the Minister for Financial Services and Regulation
Corporations (Fees) Act 2001
Corporations (Fees) Amendment Regulations 2001 (No. 1)
Section 8 of the Corporations (Fees) Act 2001 (the Fees Act) empowers the Governor-General to make regulations for the purposes of sections 5 and 6 of that Act. Section 5 provides that, subject to section 6, the regulations may prescribe fees for chargeable matters and that fees prescribed by the regulations for chargeable matters are imposed, and are so imposed as taxes. Section 6 provides, among other things, that the regulations may prescribe a fee for a chargeable matter by specifying an amount as the fee or by specifying a method for calculating the amount of the fee.
The purpose of the regulations is to support the reforms to the regulation of the financial services industry which are included in the Financial Services Reform Act 2001 and associated legislation, and to make certain miscellaneous amendments.
The responsible Ministers of the States and the Northern Territory on the Ministerial Council for Corporations have been consulted about the regulations as required for the current Corporations Agreement which was reached by State, Northern Territory and Commonwealth Ministers who had responsibilities in relation to corporate regulation in June 1990. This Agreement formed the political compact on which the national companies and securities scheme, which operated from 1 January 1991 to 14 July 2001, was based. That scheme was superseded by a new legislative scheme which commenced on 15 July 2001. The new scheme is based on Commonwealth legislation enacted with the assistance of relevant power referred by the States. It is envisaged that a new Agreement, reflecting the changed constitutional basis of the relevant law, will be signed but meanwhile the Commonwealth, States and the Northern Territory consider themselves bound by the proposed new agreement. The new Agreement also requires that the Council be consulted in relation to amendments to the Fees Regulations, but does not require the Council's approval.
The Financial Services Reform Act 2001 amends the Corporations Act 2001 and the Australian Securities and Investments Commission Act 2001, and will provide:
• a single licensing regime for financial sales, advice and dealings in relation to financial products;
• consistent and comparable financial product disclosure; and
• a single authorisation procedure for financial exchanges and clearing and settlement facilities.
The Financial Services Reform Act 2001 repeals Chapters 7 and 8 of the Corporations Act 2001 and substitutes a new Chapter 7.
The amendments to the Fees Regulations omit the fees which are payable in relation to various provisions of Chapters 7 and 8 as they currently stand and replace these items with the fees payable in relation to comparable activity under the Chapter 7 which the Financial Services Reform Act 2001 will insert into the Corporations Act 2001.
The fees set relate to such matters as:
• lodging an application for ail relevant licence;
• inspecting registers kept by ASIC for the purpose of the new provisions;
• lodging a Product Disclosure Statement.
The amount of each fee is comparable to that which would have been charged for a similar service under the current provisions.
The regulations will commence at the same time as Item 1 of Schedule 1 of the Financial Services Reform Act 2001 commences.
Overview
The Corporations (Fees) Amendment Regulations 2001 (No. 1) were enacted to align with the reforms introduced by the Financial Services Reform Act 2001. This legislation was necessary to address gaps in the financial services regulation framework that had arisen due to the transition from the old national companies and securities scheme to a new legislative regime. Issued under the authority of the Minister for Financial Services and Regulation, these regulations amend the Corporations (Fees) Act 2001 to establish new fees for activities such as applying for a financial services licence, inspecting registers kept by the Australian Securities and Investments Commission, and lodging a Product Disclosure Statement. The aim of these amendments is to support the new licensing regime, consistent financial product disclosure, and unified authorisation procedures for financial exchanges and clearing facilities. The regulations were developed in consultation with the Ministerial Council for Corporations, reflecting the shared governance approach under the current Corporations Agreement, and are set to commence alongside the Financial Services Reform Act 2001.
Scope and Application
The Corporations (Fees) Amendment Regulations 2001 (No. 1) apply to the imposition of fees for chargeable matters under the Corporations (Fees) Act 2001. These regulations are particularly relevant to entities within the financial services industry, including companies and financial product issuers, as well as the Australian Securities and Investments Commission (ASIC) which administers the fees. They govern the fees associated with the application for financial services licenses, the inspection of registers, and the lodging of product disclosure statements. These amendments align with the reforms introduced by the Financial Services Reform Act 2001, which established a single licensing regime for financial products and services, consistent financial product disclosure, and a unified authorisation procedure for financial exchanges. The regulations reflect the new legislative framework, replacing fees under the repealed Chapters 7 and 8 of the Corporations Act 2001 with those applicable under the new Chapter 7. The fees prescribed are comparable to those previously charged under the existing provisions, and the regulations commence concurrently with the commencement of the Financial Services Reform Act 2001.
Key Provisions
The Corporations (Fees) Amendment Regulations 2001 (No. 1) primarily amend the fees associated with the financial services industry as part of the broader reforms introduced by the Financial Services Reform Act 2001. These amendments, outlined in the explanatory statement, are designed to align the fees with the new legislative scheme that commenced on 15 July 2001. Section 8 of the Corporations (Fees) Act 2001 allows for the creation of these regulations, which prescribe fees for chargeable matters, imposing them as taxes (section 5). The fees can be specified either by a set amount or by a method of calculation (section 6). These regulations support the reforms by adjusting the fees payable for activities such as lodging an application for a relevant licence, inspecting registers kept by the Australian Securities and Investments Commission (ASIC) for new provisions, and lodging a Product Disclosure Statement.
The regulations impose specific obligations on entities and individuals within the financial services industry. They must comply with the new fee structures when lodging applications, inspecting registers, and submitting statements. The fees set forth in the regulations are intended to mirror the costs that would have been incurred under the previous legislative framework, ensuring continuity and predictability in financial obligations. The regulations also require entities to adapt to the new licensing regime, consistent financial product disclosure, and single authorisation procedure for financial exchanges and clearing and settlement facilities, as provided for in the Financial Services Reform Act 2001.
Failure to comply with the provisions of these regulations may result in various civil and criminal consequences. While the regulations themselves do not explicitly detail penalties for non-compliance, breaches of related provisions in the Corporations Act 2001 and the Australian Securities and Investments Commission Act 2001 can attract significant penalties. For instance, under the Corporations Act 2001, penalties for non-compliance can include substantial fines and, in serious cases, imprisonment. The exact penalties depend on the nature and severity of the breach, with maximum penalties often reflecting the potential impact on the financial system and public confidence in financial services.