Terrorism and Cyclone Insurance (Payments) Direction 2023
I, Stephen Jones, Assistant Treasurer and Minister for Financial Services, give the following direction to the Australian Reinsurance Pool Corporation.
Dated 23 March 2023
Stephen Jones
Assistant Treasurer
Minister for Financial Services
Contents
Part 1—Preliminary
1 Name
2 Commencement
3 Authority
4 Definitions
Part 2—Direction to make payments
5 Payments to the Commonwealth
Part 1—Preliminary
1 Name
This instrument is the Terrorism and Cyclone Insurance (Payments) Direction 2023.
2 Commencement
(1) Each provision of instrument 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 |
Provisions | Commencement | Date/Details |
1. The whole of this instrument | The day after this instrument is registered. | |
Note: This table relates only to the provisions of this instrument as originally made. It will not be amended to deal with any later amendments of this instrument.
(2) Any information in column 3 of the table is not part of this instrument. Information may be inserted in this column, or information in it may be edited, in any published version of this instrument.
3 Authority
This instrument is made under the Terrorism and Cyclone Insurance Act 2003.
4 Definitions
Note: Paragraph 13(1)(b) of the Legislation Act 2003 has the effect that expressions have the same meaning in this instrument as in the Terrorism and Cyclone Insurance Act 2003 as in force from time to time.
In this instrument:
the Act means the Terrorism and Cyclone Insurance Act 2003.
Part 2—Direction to make payments
5 Payments to the Commonwealth
(1) Under section 38 of the Act, the Corporation is directed to make each of the following payments to the Commonwealth:
(a) $55 million, as a guarantee fee; and
(b) $35 million, as a capital holding fee.
(2) The payments are to be made to the Commonwealth on or before 31 March 2023 by electronic transfer to:
Account name—Department of the Treasury Official Administered Receipts Account
BSB—092-009
Account Number—918 379
Overview
The Terrorism and Cyclone Insurance (Payments) Direction 2023 was enacted to facilitate specific payments to the Commonwealth as outlined under the Terrorism and Cyclone Insurance Act 2003. This notifiable instrument, issued by Stephen Jones, Assistant Treasurer and Minister for Financial Services, is designed to direct the Australian Reinsurance Pool Corporation to make two payments totalling $90 million to the Commonwealth. The instrument, which commenced on the day after its registration, was issued under the authority of the aforementioned Act and defines key terms as per the definitions in the Act. The policy objective, as inferred from the context, is to ensure that the necessary financial resources are directed towards the Commonwealth to support specific obligations related to terrorism and cyclone insurance.
This legislative direction aims to address the financial requirements stipulated by the Terrorism and Cyclone Insurance Act 2003. By mandating the Australian Reinsurance Pool Corporation to make these payments, the direction ensures that the Commonwealth receives the necessary funds to meet its obligations under the Act. The payments, comprising a guarantee fee of $55 million and a capital holding fee of $35 million, are to be made by electronic transfer to the specified Department of the Treasury account by 31 March 2023.
Scope and Application
The Terrorism and Cyclone Insurance (Payments) Direction 2023 applies to the Australian Reinsurance Pool Corporation, directing it to make specified payments to the Commonwealth. The direction is issued under the authority of the Terrorism and Cyclone Insurance Act 2003 and aims to facilitate the transfer of funds by the Corporation to the Department of the Treasury. The Act itself governs the obligations and transactions involving terrorism and cyclone insurance, with the direction serving to operationalise these obligations by directing particular payments. The direction has a national jurisdictional reach, applying to entities within Australia and those engaged in activities covered by the Act. The specified payments, amounting to $55 million as a guarantee fee and $35 million as a capital holding fee, must be completed by electronic transfer to the Department of the Treasury's designated account by 31 March 2023. This direction extends the application of the Terrorism and Cyclone Insurance Act through the issuance of specific payment instructions, thereby enforcing the Act's financial stipulations.
Key Provisions
The Terrorism and Cyclone Insurance (Payments) Direction 2023I, made under the Terrorism and Cyclone Insurance Act 2003, directs the Australian Reinsurance Pool Corporation to make specific payments to the Commonwealth. Section 38 of the Act mandates these payments, which include a guarantee fee of $55 million and a capital holding fee of $35 million. The direction specifies that these payments must be made by electronic transfer to the Department of the Treasury Official Administered Receipts Account, with the BSB number 092-009 and account number 918 379, by 31 March 2023.
The obligations imposed by this direction are clear and straightforward. The Australian Reinsurance Pool Corporation must ensure that the specified payments are made on time, to the correct account, and using the prescribed method of electronic transfer. This involves coordinating with financial institutions to facilitate the timely transfer of funds to the Department of the Treasury. The Corporation must also ensure that the necessary documentation and records are maintained to demonstrate compliance with the direction.
Failure to comply with the provisions of this direction could have legal consequences. While the direction itself does not explicitly outline specific penalties for non-compliance, breaches of statutory directions can lead to civil or criminal penalties under the Terrorism and Cyclone Insurance Act 2003 or other applicable legislation. The potential penalties may include fines, legal action, or other enforcement measures, depending on the severity and impact of the non-compliance. The exact penalties would be determined in the context of any legal proceedings resulting from a breach.