EXPLANATORY STATEMENT
STATUTORY RULES 1982 No. 125
Issued by the authority of the Attorney-General
AMENDMENT OF THE SECURITIES INDUSTRY REGULATIONS
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. The Agreement is set out in the Schedule to the National Companies and Securities Commission Act 1979 (NCSC Act). The purpose of the NCSC Act is to establish the National Companies and Securities Commission (NCSC).
Under clause 32 of the Formal Agreement, the 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 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;
(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 make a number of minor amendments to the Securities Industry Regulations.
Regulation 1 of the accompanying regulations omits sub-regulations 6(1) and (2) of the Securities Industry Regulations. Those sub-regulations provide that for the purposes of paragraphs 5(4)(e) and 5(7)(c) of the Securities Industry Act 1980 the prescribed percentage (of voting shares in a body corporate) is 20%. The sub-regulations have become superfluous since the addition of sub-section 5(12) of the Securities Industry Act 1980 by proclamation in October 1981. (See Securities Industry Amendment Act (No. 2) 1981, paragraph 4(b)). Sub-section 5(12) provides that a reference in section 5 to the prescribed percentage is a reference to 20% or such lesser percentage as is prescribed by the Regulations.
Regulation 2(a) of the accompanying regulations amends item 1 of the directions specified in Form 2 of the Securities Industry Regulations. Item 1 sets out the terms of sub-section 19(8) of the Securities Industry Act 1980. The proposed amendment takes account of the amendment made to sub-section 19(8) by section 13 of the Securities Industry Amendment Act (No. 2) 1981, which has been proclaimed to come into operation from 1 October 1981.
Regulations 2(b) to (e) inclusive of the accompanying regulations make amendments to form 9 of the Securities Industry Regulations, a notice which a licence holder under the Securities Industry Act 1980 is required to lodge with the NCSC within 21 days of a cessation or change in relation to his licence. The amendments will make it necessary to indicate on what day the changes
referred to in paragraphs 3(c), (d), (e) and (f) of Form 9 occurred. Paragraph 3(c) of Form 9 requires a dealer or investment adviser to state any change of address of his principal place of business. Paragraph 3(d) requires a dealer or investment adviser to state any change of address of the place or places, other than the principal place of business, at which his business is carried on. Paragraph 3(e) requires a dealer or investment adviser to state any change in the name or style of his business, where that name or style is different from his own name. Paragraph 3(f) requires a dealer or investment adviser to state whether he has ceased to be a partner in a certain firm and whether he has become a partner in another firm.
Regulation 2(f) of the accompanying regulations substitutes the word “licensee’s” for “applicant’s” in paragraph (1)(d) of Form 11 of the Securities Industry Regulations (the annual statement by a dealer or investment adviser that is a corporation) since the rest of that Form is directed towards the “licensee” rather than the “applicant”.