National Companies and Securities Commission Regulations (Amendment)

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EXPLANATORY STATEMENT

STATUTORY RULES 1982 No.123

Issued by the authority of the Attorney-General.

 

NATIONAL COMPANIES AND SECURITIES COMMISSION REGULATIONS (AMENDMENT)

On 22 December 1978 the Commonwealth and the States executed a Formal Agreement that provides the framework for a co-operative Commonwealth-State scheme for a uniform system of law and administration in relation to company law and the regulation of the securities industry in the six States and the Australian Capital Territory.

Under clause 32 of the Formal Agreement, the National Companies and Securities Commission (NCSC) is to have responsibility for the entire area of policy and administration with respect to company law and the regulation of the securities industry, subject to directions by the Ministerial Council for Companies and Securities. The Ministerial Council consists of Commonwealth and State Ministers responsible for administering the law relating to companies and the regulation of the securities industry, or their delegates, or the Ministers acting in their office (Formal Agreement, clauses 19 and 20).


Under sub-clause 45(1) of the Formal Agreement, the Ministerial Council may consider a proposal for the amendment of regulations made under the Commonwealth Acts enacted for the purposes of the co-operative scheme. Should the Ministerial Council approve any draft amending regulation which gives effect to such a proposal, the Commonwealth is then required, under sub-clause 45(2) of the Agreement, to submit the draft regulation to the Federal Executive Council for making by the Governor-General.

The Ministerial Council has passed the following resolutions:

“1. The Ministerial Council resolved unanimously pursuant to paragraph 8(1)(b) of the Formal Agreement that:-

Commonwealth

(A)                    Companies Regulations (Amendment)

The draft Companies Regulations (Amendment) being as set out in the print dated 10th May, 1982;

and

(b) Companies (Transitional Provisions) Regulations

The draft Companies (Transitional Provisions) Regulations being as set out in the print dated 10th May, 1982;

be approved.


2. The Ministerial Council resolved pursuant to clause 45 of the Formal Agreement that:-

Commonwealth

(A) National Companies and Securities Commission Regulations (Amendment) (S.R. No. 73/82)

The draft National Companies and Securities Commission Regulations (Amendment) (S.R. No. 73/82) being as set out in the print dated 11th May, 1982;

(B) Securities Industry Regulations (Amendment) (S.R. No. 394/81)

The draft Securities Industry Regulations (Amendment) (S.R. No. 394/81) being as set out in the print dated 11th May, 1982;

and

(C) Securities Industry Regulations (Amendment) (S.R. No. 50/82)

The draft Securities Industry Regulations (Amendment) (S.R. No. 50/82) being as set out in the print dated 11th May, 1982;

be respectively approved.”


The purpose of the accompanying regulations is to amend the National Companies and Securities Commission Regulations (NCSC Regulations) by adding the Commonwealth Companies Act 1981 to the list of Acts and Ordinances already prescribed for the purposes of various provisions of the NCSC Act.

Regulation 1 of the accompanying regulations provides that these Regulations are to come into operation on 1 July 1982, which is the date that the Ministerial Council has agreed will be the commencement date of the Commonwealth Companies Act 1981.

Sub-section 41(4) of the NCSC Act provides that a person appointed for the purposes of the NCSC Act or any other prescribed Act is not liable for acts done or omitted to be done in good faith in the performance of his duty. Present regulation 11 prescribes the Commonwealth Securities Industry Act 1980 and the ACT Corporate Affairs Commission Ordinance 1980 for the purposes of sub-section 41(4) of the NCSC Act. Regulation 2 of the accompanying regulations ensures that a person appointed for the purposes of the Commonwealth Companies Act 1981 will be given the same protection against liability as a person appointed for the purposes of the Commonwealth Securities Industry Act 1980 or the ACT Corporate Affairs Commission Ordinance 1980.

Paragraph 47(1)(a) of the NCSC Act prohibits a person who is, or has at any time been, appointed for the purposes of the NCSC Act or any other prescribed Act from divulging or making use of information by reason of his employment otherwise than in the


performance of his official duties. Present regulation 12 prescribes the Commonwealth Securities Industry Act 1980 ana the ACT Corporate Affairs Commission Ordinance 1980 for the purposes of paragraph 47(1)(a). Regulation 3 of the accompanying regulations imposes the same obligations of secrecy on a person appointed for the purposes of the Companies Act 1981 as are already imposed on a person appointed for the purposes of the Commonwealth Securities Industry Act 1980, or the ACT Corporate Affairs Commission Ordinance 1980.

Paragraph 47(2)(a) of the NCSC Act provides that, notwithstanding the above prohibition, a person is not precluded from producing a document to a court in the course of criminal proceedings or in the course of any proceedings under the NCSC Act, any other prescribed Act or any prescribed State Act. Present regulation 13 prescribes the following laws for the purposes of paragraph 47(2)(a):

- the Commonwealth Companies (Acquisition of Shares) Act 1980

- the Companies (Acquisition of Shares) (Application of Laws) Act of each State

- the National Companies and Securities Commission (State Provisions) Act of each State

- the Commonwealth Securities Industry Act 1980

- the Securities Industry (Application of Laws) Act of each State.


In addition to the laws prescribed by present regulation 13, regulation 4 of the accompanying regulations prescribes the Commonwealth Companies Act 1981 and the Companies (Application of Laws) Act of each State (apart from Tasmania which has not yet enacted its Companies (Application of Laws) Act) for the purposes of paragraph 47(2)(a) of the NCSC Act.

Paragraph 48(1)(a) of the NCSC Act prohibits a person who is, or has at any time been, appointed for the purposes of the NCSC Act or any other prescribed Act from dealing in securities if he has price sensitive information that is not generally available. Present regulation 14 prescribes the Commonwealth Securities Industry Act 1980 and the ACT Corporate Affairs Commission Ordinance 1980 for the purposes of paragraph 48(1)(a). Regulation 5 of the accompanying regulations ensures that a person appointed for the purposes of the Commonwealth Companies Act 1981 will be subject to the same restrictions on dealing in securities as a person appointed for the purposes of the Commonwealth Securities Industry Act 1980 or the ACT Corporate Affairs Commission Ordinance 1980.

Sub-section 49(1) of the NCSC Act provides that a person (other than a member or acting member of the NCSC or its staff) appointed for the purposes of the NCSC Act or any other prescribed Act must inform the NCSC if, in the course of his duties, he is required to consider certain matters where a potential conflict of interest may arise e.g. a matter relating to a body corporate in which he has a relevant interest. Present

regulation 15 prescribes the Commonwealth Securities Industry Act 1980 and the ACT Corporate Affairs Commission Ordinance 1980 for the purposes of sub-section 49(1). Regulation 6 of the accompanying regulations will ensure that a person appointed for the purposes of the Commonwealth Companies Act 1981 will be under the same obligations to notify the NCSC of relevant interests as a person appointed for the purposes of the Commonwealth Securities Industry Act 1980 or the ACT Corporate Affairs Commission Ordinance 1980.

S.R. No. 73/82

Overview

The National Companies and Securities Commission Regulations (Amendment) 1982 was enacted to address the need for updating the regulatory framework governing company law and securities regulation in Australia. This legislative amendment was introduced to align the National Companies and Securities Commission Regulations with the new Commonwealth Companies Act 1981. The problem it sought to resolve was the integration of the Commonwealth Companies Act 1981 into the existing regulatory framework, ensuring that the new act was properly incorporated within the broader co-operative scheme established by the Commonwealth and the States through the Formal Agreement of 1978. The enacting body for these regulations was the Federal Executive Council, acting on the approval of the Ministerial Council for Companies and Securities, in accordance with the provisions of the Formal Agreement. The policy objective was to maintain consistency and uniformity in the regulation of company law and securities across the Commonwealth and the States, ensuring that all relevant acts and regulations were properly integrated and that appointed personnel were subject to the same obligations and protections.

Scope and Application

The National Companies and Securities Commission Regulations (Amendment) Statutory Rules 1982 No. 123, issued by the authority of the Attorney-General, amend the National Companies and Securities Commission Regulations to incorporate the Commonwealth Companies Act 1981 into the list of Acts and Ordinances prescribed for various provisions of the National Companies and Securities Commission Act 1981. These regulations apply to individuals appointed under the Act or any other prescribed Act, ensuring they are granted the same protections against liability and obligations of secrecy as those appointed under the Commonwealth Securities Industry Act 1980 or the ACT Corporate Affairs Commission Ordinance 1980. The regulations also extend to the application of laws, including the Companies (Acquisition of Shares) Act 1980 and the Companies (Application of Laws) Act of each State, for the purposes of disclosure obligations in court proceedings and restrictions on dealing in securities based on price-sensitive information. Additionally, the regulations impose the same notification requirements for potential conflicts of interest on persons appointed under the Companies Act 1981 as those appointed under other relevant Acts. The amendments come into operation on 1 July 1982, aligning with the commencement date of the Commonwealth Companies Act 1981. The regulations extend across the Commonwealth, and while they do not explicitly state exclusions, they operate within the framework set by the Ministerial Council for Companies and Securities, which includes Commonwealth and State Ministers.

Key Provisions

The National Companies and Securities Commission Regulations (Amendment) primarily aim to incorporate the Commonwealth Companies Act 1981 into the existing regulatory framework. Specifically, section 1 of these regulations establishes the commencement date of 1 July 1982, aligning with the implementation of the Companies Act 1981. Section 2 ensures that individuals appointed under the new Companies Act receive the same legal protections against liability as those appointed under the Commonwealth Securities Industry Act 1980 and the ACT Corporate Affairs Commission Ordinance 1980. This includes immunity for actions taken in good faith and within the scope of their duties, as outlined in sub-section 41(4) of the NCSC Act. The regulations impose several obligations on parties governed by them. For instance, section 3 mandates that appointees under the Companies Act 1981 adhere to the same confidentiality requirements as those under the Securities Industry Act 1980 and the ACT Ordinance 1980. This includes prohibiting the disclosure of information obtained during their employment, except when required in the performance of their official duties, as stipulated in paragraph 47(1)(a) of the NCSC Act. Additionally, section 4 extends the scope of permissible document production in legal proceedings to include the Companies Act 1981 and the Companies (Application of Laws) Act of each State, except Tasmania, as outlined in paragraph 47(2)(a). Further obligations include restrictions on securities trading for appointees with price-sensitive, non-public information, as provided in paragraph 48(1)(a) of the NCSC Act and detailed in section 5. This section ensures that individuals appointed under the Companies Act 1981 face the same trading restrictions as those under the Securities Industry Act 1980 and the ACT Ordinance 1980. Finally, section 6 mandates that appointees under the Companies Act 1981 must notify the NCSC of any potential conflicts of interest, aligning with sub-section 49(1) of the NCSC Act. The regulations also establish consequences for non-compliance. For instance, violations of confidentiality obligations under paragraph 47(1)(a) of the NCSC Act may lead to criminal penalties. Similarly, breaches of the securities trading restrictions under paragraph 48(1)(a) could result in fines and other civil penalties as prescribed by the relevant Acts. Failure to declare potential conflicts of interest under sub-section 49(1) may also incur penalties, including administrative sanctions and potential disqualification from office. The exact penalties for these offences are detailed in the respective Acts and may vary, but they underscore the importance of compliance with these regulatory requirements.

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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.