Financial Claims Scheme (ADIs) Levy Act 2008

Administered by Department of the Treasury

Legislation au C2008A00103 In force Act

Legislation content

 

 

 

 

 

 

Financial Claims Scheme (ADIs) Levy Act 2008

 

No. 103, 2008

 

 

 

 

 

An Act to provide for the imposition of a levy on liabilities of authorised deposit‑taking institutions to their depositors

 

 

 

Contents

1 Short title

2 Commencement

3 Definitions

4 Regulations may impose levies

5 Amount of levy

6 Regulations

 

 

 

Financial Claims Scheme (ADIs) Levy Act 2008

No. 103, 2008

 

 

 

An Act to provide for the imposition of a levy on liabilities of authorised deposit‑taking institutions to their depositors

[Assented to 17 October 2008]

The Parliament of Australia enacts:

1  Short title

  This Act may be cited as the Financial Claims Scheme (ADIs) Levy Act 2008.

2  Commencement

 (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

 

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

1.  Sections 1 and 2 and anything in this Act not elsewhere covered by this table

The day on which this Act receives the Royal Assent.

17 October 2008

2.  Sections 3 to 6

The later of:

(a) the start of the day on which this Act receives the Royal Assent; and

(b) the commencement of Schedule 1 to the Financial System Legislation Amendment (Financial Claims Scheme and Other Measures) Act 2008.

However, the provision(s) do not commence at all if the event mentioned in paragraph (b) does not occur.

18 October 2008

Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.

 (2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.

3  Definitions

  In this Act:

ADI has the same meaning as in the Banking Act 1959.

APRA has the same meaning as in the Banking Act 1959.

APRA’s financial claims scheme costs for an ADI in relation to which Subdivision C of Division 2AA of Part II of the Banking Act 1959 applies or applied means the sum of:

 (a) entitlements under that Subdivision relating to the ADI; and

 (b) the costs of the following:

 (i) the administration of that Division in relation to the ADI;

 (ii) the exercise of APRA’s powers under that Division in relation to the ADI;

 (iii) the performance of APRA’s functions under that Division in relation to the ADI; and

 (c) the costs of any borrowing under section 54E of the Australian Prudential Regulation Authority Act 1998 connected with the application of that Subdivision in relation to the ADI.

levy means levy imposed under this Act.

4  Regulations may impose levies

 (1) In connection with the application of Subdivision C of Division 2AA of Part II of the Banking Act 1959 in relation to an ADI, the regulations may impose levy on the liabilities that:

 (a) are liabilities of ADIs in a class prescribed by the regulations to their depositors; and

 (b) exist at the end of a financial year or other 12‑month accounting period used instead of a financial year.

 (2) The regulations must prescribe the class for the purposes of paragraph (1)(a) so as to exclude all ADIs in relation to which that Subdivision applies.

5  Amount of levy

 (1) The amount of levy is the amount worked out in accordance with the regulations.

 (2) However, the amount of levy on an ADI’s liabilities to its depositors cannot be more than 0.5% of the amount, worked out in accordance with the regulations, of those liabilities.

 (3) The regulations may prescribe:

 (a) different ways of working out for the purposes of subsection (1) the amount of levy on liabilities of ADIs in different classes prescribed by the regulations; and

 (b) different ways of working out for the purposes of subsection (2) the amounts of liabilities of ADIs in different classes prescribed by the regulations.

6  Regulations

 (1) The Governor‑General may make regulations prescribing matters required or permitted by this Act to be prescribed.

 (2) Before the Governor‑General makes a regulation affecting the imposition or amount of a levy connected with the application of Subdivision C of Division 2AA of Part II of the Banking Act 1959 in relation to an ADI, the Minister must be satisfied the regulation will help achieve the objective in subsection (3) of this section.

 (3) The objective is that the total amount of levy connected with the application of that Subdivision in relation to the ADI equal the excess of APRA’s financial claims scheme costs for the ADI over the sum of amounts paid to APRA by the ADI in connection with that Division or in the winding up of the ADI.

 

 

 

 

[Minister’s second reading speech made in—

House of Representatives on 15 October 2008

Senate on 16 October 2008]

(205/08)

 

Overview

The Financial Claims Scheme (ADIs) Levy Act 2008 was enacted by the Parliament of Australia to provide a mechanism for imposing a levy on the liabilities of authorised deposit-taking institutions (ADIs) to their depositors. This legislation aims to ensure that the costs associated with the Australian Prudential Regulation Authority's (APRA) financial claims scheme are adequately covered. The Act was assented to on 17 October 2008 and certain provisions commenced on 18 October 2008, contingent on the commencement of Schedule 1 to the Financial System Legislation Amendment (Financial Claims Scheme and Other Measures) Act 2008. The primary objective of the Act is to facilitate the imposition of a levy that aligns with APRA's financial claims scheme costs for ADIs, ensuring these costs do not exceed the total levies imposed on the ADIs.

Scope and Application

The Financial Claims Scheme (ADIs) Levy Act 2008 applies to authorised deposit-taking institutions (ADIs) as defined in the Banking Act 1959, allowing for the imposition of a levy on their liabilities to depositors. The Act's primary purpose is to ensure that the Australian Prudential Regulation Authority (APRA) can cover the costs associated with its financial claims scheme through these levies. The Act came into force on 17 October 2008, with specific sections related to the levy itself commencing on 18 October 2008, contingent on the commencement of Schedule 1 to the Financial System Legislation Amendment (Financial Claims Scheme and Other Measures) Act 2008. The Act's geographic reach is national, applying across Australia, and it is administered by the Commonwealth Government. The Act extends its application through subordinate regulations, which may specify the classes of ADIs subject to the levy, methods of calculating the levy amount, and other necessary details, subject to the Minister's satisfaction that these regulations help achieve the objective of covering APRA’s financial claims scheme costs.

Key Provisions

The Financial Claims Scheme (ADIs) Levy Act 2008 (sections 1-6) provides a legislative framework for imposing a levy on certain authorised deposit-taking institutions (ADIs) to fund the Australian Prudential Regulation Authority's (APRA) financial claims scheme. The Act specifies that the levy can be imposed on liabilities of ADIs to their depositors (section 4(1)). The amount of the levy is determined in accordance with regulations, with a cap of 0.5% of the liabilities (section 5(1)-(3)). Regulations may vary the calculation methods for different classes of ADIs (section 6(1)-(2)). The Act also outlines the legislative process for making these regulations, ensuring they align with the objective of covering APRA's financial claims scheme costs (section 6(3)). The Act imposes obligations on the Governor-General to make regulations as required by the Act (section 6(1)). It mandates that the Minister must be satisfied that any regulation affecting the levy will help achieve the specified objective before the Governor-General can make such a regulation (section 6(2)). The objective is that the total levy should cover the excess of APRA's financial claims scheme costs over any amounts already paid by the ADIs (section 6(3)). The regulations must also ensure that all ADIs in relation to which the financial claims scheme applies are excluded from the levy (section 4(1)(a)). Breaching the provisions of this Act may result in various penalties and consequences. While the Act does not explicitly detail specific penalties, it implies that non-compliance with the regulatory framework established by the Act may lead to legal actions or other regulatory measures. The potential civil or criminal consequences for breach would depend on the nature and severity of the non-compliance, as well as other relevant laws and regulations governing financial institutions in Australia. The maximum penalties, if applicable, would be determined in accordance with other pertinent legislative provisions.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.