EXPLANATORY STATEMENT
Select Legislative Instrument 2008 No. 163
Issued by authority of the Minister for Superannuation and Corporate Law for the Attorney‑General
Electronic Transactions Act 1999
Electronic Transactions Amendment Regulations 2008 (No. 2)
Section 16 of the Electronic Transactions Act 1999 (the Act) provides that the Governor‑General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.
The objects of the Act include facilitating the use of electronic transactions and enabling business and the community to use electronic communications in their dealings with the Government. The Act generally provides that if a Commonwealth law requires or permits transactions to be in written form that requirement is met if the transaction is made in electronic form.
However, under subsection 13(3) of the Act, certain laws of the Commonwealth may be exempted from the operation of Division 2 of the Act by being specified in regulations. The effect of the exemption is that requirements in those laws for writing, signature and production and retention of documents cannot be met in an electronic form. The Electronic Transactions Regulations 2000 (the Principal Regulations) specify those laws that are exempt from Division 2.
Schedule 1 to the Principal Regulations sets out the laws of the Commonwealth to which certain provisions of the Act do not apply.
The Regulations insert a reference to the First Home Saver Accounts Act 2008 (the FHSA Act) into Schedule 1, so that Part 7 of the FHSA Act is exempt from the requirements of subsection 8(1), Division 2 of Part 2 and sections 14 and 15 of the Act.
The effect of the amendment is that First Home Saver Account (FHSA) providers submitting certain applications and notices under the FHSA Act to the Australian Prudential Regulation Authority (APRA) need to provide hard copies of these documents.
Under Part 7 of the FHSA Act, account providers that are registrable superannuation entity (RSE) licensees must apply to APRA for authorisation before offering FHSAs. Account providers that are authorised deposit-taking institutions and life insurance companies are required to submit a notice to APRA before offering FHSAs.
These applications and notices require signatures, but APRA does not currently have the technology to accept electronic signatures. An electronic signature is intended to take the place of a traditional handwritten signature in a document. Its purpose is to identify the person, provide certainty that the person was involved in signing/approving the document and associate the person with the content of the document. An example of an electronic signature is a digitised version of a handwritten signature. At present, APRA does not have the technology in place to convert handwritten signatures into a digitised version and will continue to require a handwritten signature on its forms.
The exemption is consistent with exemptions provided to other prudential laws (the Banking Act 1959, the Insurance Act 1973, the Life Insurance Act 1995 and the Superannuation Industry (Supervision) Act 1993).
The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The Regulations commenced on the day after they were registered on the Federal Register of Legislative Instruments.
These Regulations form part of a package of amendments relating to the introduction of the First Home Saver Accounts scheme. As part of consultation for the package of regulations, the Government has consulted industry representatives through a Technical Reference Group, the Attorney-General’s Department and the Australian Prudential Regulation Authority in making these regulations.
Additionally, as part of a public consultation on the proposed scheme, APRA sent a letter to authorised deposit-taking institutions, life companies and RSE licensees seeking comments in June 2008. The letter included a draft of the Application for Authorisation form for RSE licensees who wish to provide FHSAs.
Overview
The Electronic Transactions Amendment Regulations 2008 (No. 2) were introduced to address the gap in the Electronic Transactions Act 1999, specifically concerning the ability of the Australian Prudential Regulation Authority (APRA) to accept electronic signatures on certain forms. Enacted by the Parliament of Australia, this legislation aims to facilitate the use of electronic transactions while ensuring compliance with existing regulatory requirements. The policy objective is to enable the use of electronic communications in dealings with the Government while accommodating specific technological limitations within APRA that prevent the acceptance of electronic signatures. The regulations exempt certain provisions of the Electronic Transactions Act to ensure that First Home Saver Account (FHSA) providers continue to submit hard copies of necessary documents to APRA. This amendment aligns with exemptions for other prudential laws and ensures a consistent approach to document submission across regulated entities.
Scope and Application
The Electronic Transactions Amendment Regulations 2008 (No. 2) applies to entities within the Commonwealth of Australia, specifically targeting First Home Saver Account (FHSA) providers who are either registrable superannuation entity (RSE) licensees, authorised deposit-taking institutions, or life insurance companies. These entities are required to comply with certain provisions of the Electronic Transactions Act 1999 when submitting applications and notices to the Australian Prudential Regulation Authority (APRA). The Act generally facilitates the use of electronic transactions by providing that if a Commonwealth law requires or permits transactions to be in written form, that requirement can be met if the transaction is made in electronic form. However, these Regulations exempt Part 7 of the First Home Saver Accounts Act 2008 from this general provision, meaning that FHSA providers must submit hard copies of specific documents to APRA due to the absence of technology to accept electronic signatures. This exemption aligns with similar provisions in other prudential laws, ensuring consistency in regulatory practices across related sectors.
Key Provisions
The Electronic Transactions Amendment Regulations 2008 (No. 2) amend the Electronic Transactions Regulations 2000 by inserting the First Home Saver Accounts Act 2008 into Schedule 1 (section 3). This amendment means that certain provisions of the Electronic Transactions Act 1999 (the Act) do not apply to Part 7 of the First Home Saver Accounts Act 2008 (the FHSA Act). This change is significant as it requires First Home Saver Account (FHSA) providers, when submitting applications and notices to the Australian Prudential Regulation Authority (APRA), to provide hard copies of these documents, as APRA does not currently accept electronic signatures. The Electronic Transactions Act 1999 generally allows for transactions to be conducted electronically where Commonwealth laws require or permit written form (section 8(1)), but certain laws can be exempted from this provision through regulation (subsection 13(3)). The Regulations effectively exempt the FHSA Act from this flexibility, meaning that specific requirements under Part 7 of the FHSA Act cannot be met in electronic form.
The obligations imposed by the Regulations on FHSA providers are specific and centre around the submission of physical, handwritten documents to APRA. For instance, registrable superannuation entity (RSE) licensees that are FHSA providers must submit applications for authorisation to APRA in hard copy, complete with handwritten signatures (section 3). Similarly, authorised deposit-taking institutions and life insurance companies that wish to offer FHSAs must submit notices to APRA, also in hard copy and with handwritten signatures. This requirement ensures that there is a tangible, verifiable record of the submission, which is crucial for compliance and oversight purposes.
The Regulations do not specify particular offences or penalties for non-compliance with the requirement to submit hard copies of documents. However, failure to adhere to the provisions of the First Home Saver Accounts Act 2008 or the regulations made under it could potentially result in legal consequences under those Acts. For example, the FHSA Act includes provisions for civil penalties and enforcement actions against providers who fail to comply with the requirements for FHSAs. While the specific penalties are not detailed in the Regulations, they could include fines, corrective actions, or even revocation of authorisation to offer FHSAs. Compliance with these requirements is crucial to avoid any adverse actions from APRA or other relevant authorities.