EXPLANATORY STATEMENT
Statutory Rules 1982 No. 366
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 accompanying regulation is identical in form and substance to the draft regulation approved by the Ministerial Council.
The purpose of the accompanying regulation is to amend the National Companies and Securities Commission Regulations (NCSC Regulations) by prescribing various superseded State and Territory legislation for the purposes of paragraph 47(2) (a) of the National Companies and Securities Commission Act 1979 (NCSC Act) so as to permit information obtained under co-operative scheme legislation to be used in furtherance of litigation commenced under the previous law.
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 acquired by reason of his employment otherwise than in the performance of his official duties. Paragraph 47(2)(a) of the NCSC Act provides that, notwithstanding this 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. Paragraph 3(3)(a) of the NCSC Act provides that a reference in that Act to an Act includes a reference to an Ordinance.
Present regulation 13 of the NCSC Regulations prescribes the following laws for the purposes of paragraph 47(2)(a):
- the Commonwealth Companies Act 1981
- the Companies (Application of Laws) Act of each State
- 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
The accompanying regulation prescribes the following additional laws for the purposes of paragraph 47(2)(a):
- the superseded Companies Acts of each State
- the superseded Companies Ordinance 1962 of the A.C.T.
- the superseded Company Take-overs Acts of Queensland, Western Australia and South Australia
- the superseded Securities Industry Acts of New South Wales, Queensland, South Australia, Victoria and Western Australia
- the superseded Securities Industry (Release of Sureties) Act 1977 of Western Australia
Overview
The National Companies and Securities Commission Regulations (Amendment) 2004 (C2004L01884) was enacted to amend the National Companies and Securities Commission Regulations, facilitating the use of certain information obtained under co-operative scheme legislation in litigation under previous laws. This regulation responds to a need identified within the co-operative scheme for company law and securities regulation between the Commonwealth and the states, as established by the 1978 Formal Agreement. The amendment was approved by the Ministerial Council for Companies and Securities and subsequently submitted to the Federal Executive Council for making by the Governor-General, as mandated by the Agreement. The objective of the regulation is to expand the scope of permissible disclosures of information by officials under the National Companies and Securities Commission Act 1979, ensuring that such information can be used in legal proceedings under both current and superseded state legislation.
Scope and Application
The National Companies and Securities Commission Regulations (Amendment) aims to broaden the scope of the existing regulations by including additional superseded State and Territory legislation. This amendment is designed to ensure that information obtained under the co-operative scheme can be used in litigation that is based on laws that have since been superseded. This regulation applies to individuals or entities appointed under the National Companies and Securities Commission Act 1979 or any other prescribed Act, as well as to the information they may acquire in their official capacities. The regulation is intended to operate across the Commonwealth, the States, and the Australian Capital Territory, reflecting the co-operative scheme's national reach. However, it does not alter the existing prohibitions on the disclosure of information except in specific legal proceedings as outlined in the Act. The regulation effectively extends the application of the NCSC Act by including more superseded legislation, thereby facilitating the use of previously acquired information in relevant legal contexts.
Key Provisions
The National Companies and Securities Commission Regulations (Amendment) Statutory Rules of 1982 No. 366 outline specific provisions under the National Companies and Securities Commission Act 1979 (NCSC Act) to facilitate the use of information obtained under the co-operative scheme in litigation. These regulations are a direct response to the need for a uniform system of law and administration across the Commonwealth and the states concerning company law and securities regulation, as outlined in the Formal Agreement executed on 22 December 1978.
These amendments specifically address paragraph 47(2)(a) of the NCSC Act, which allows for the use of information acquired by individuals appointed under the NCSC Act or related prescribed acts in court proceedings. Regulation 13 of the NCSC Regulations originally prescribed certain Commonwealth and State laws for these purposes, but the accompanying regulation expands this list to include various superseded State and Territory legislation. The intention is to ensure that information collected under the co-operative scheme can be used in legal proceedings, regardless of whether the laws in question are current or have been superseded.
The obligations imposed by these regulations require appointed individuals under the NCSC Act or related prescribed acts to adhere to the strict confidentiality provisions outlined in paragraph 47(1)(a) of the NCSC Act. This means they must not disclose or use information obtained in the course of their employment outside of their official duties. However, the amendments made by these regulations permit the production of documents to a court in specific circumstances, ensuring that the information collected can be used in litigation as necessary.
Failure to comply with the confidentiality provisions or misuse of information could result in significant legal consequences. Although the specific penalties for such breaches are not detailed in the explanatory statement, the general framework under the NCSC Act suggests that penalties could include fines or other civil or criminal sanctions, depending on the severity and intent of the breach. The regulations aim to balance the need for transparency and accountability in litigation with the protection of sensitive information obtained under the co-operative scheme.