Terrorism Insurance (Payments) Direction 2020
I, Michael Sukkar, Minister for Housing and Assistant Treasurer, give the following direction to the Australian Reinsurance Pool Corporation.
Dated 8 September 2020
Michael Sukkar
Minister for Housing
Assistant Treasurer
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 Insurance (Payments) Direction 2020.
2 Commencement
(1) Each provision of this 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Note: This table relates only to the provisions of this instrument as originally made.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 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 Insurance Act 2003 as in force from time to time.
In this instrument:
the Act means the Terrorism 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;
(b) $35 million, as a capital holding fee;
(c) $10 million, as a temporary dividend.
(2) The payments are to be made to the Commonwealth on or before 31 March 2021 by electronic transfer to:
Account name—Department of the Treasury Official Administered Receipts Account
BSB—092-009
Account Number—918 379
Overview
The Terrorism Insurance (Payments) Direction 2020I, enacted by Michael Sukkar, Minister for Housing and Assistant Treasurer, was introduced to address a financial shortfall arising from the Terrorism Insurance Act 2003. This notifiable instrument is made under the authority of the Terrorism Insurance Act 2003 and is intended to direct the Australian Reinsurance Pool Corporation to make specific payments to the Commonwealth. The objective of the direction is to ensure that the Commonwealth receives the necessary funds to cover certain fees and dividends as stipulated under the Act. The payments include a guarantee fee of $55 million, a capital holding fee of $35 million, and a temporary dividend of $10 million, all of which are to be made by electronic transfer to a designated account by 31 March 2021.
Scope and Application
The Terrorism Insurance (Payments) Direction 2020I, issued by Michael Sukkar, Minister for Housing and Assistant Treasurer, applies to the Australian Reinsurance Pool Corporation, directing it to make specific payments to the Commonwealth. This direction is made under the Terrorism Insurance Act 2003 and involves payments totalling $100 million, including $55 million as a guarantee fee, $35 million as a capital holding fee, and $10 million as a temporary dividend, all to be made by electronic transfer to a designated account by 31 March 2021. The legislation, which came into effect the day after its registration, is intended to address financial obligations arising from terrorism insurance arrangements. While the primary focus is on directing payments by the Australian Reinsurance Pool Corporation, the scope of the Act itself extends to cover terrorism insurance arrangements and related financial obligations, with specific provisions detailed in the Terrorism Insurance Act 2003. This direction does not alter the broader application of the Act, which remains in force as originally enacted.
Key Provisions
The Terrorism Insurance (Payments) Direction 2020I, issued by Michael Sukkar, Minister for Housing and Assistant Treasurer, outlines specific payments to be made by the Australian Reinsurance Pool Corporation to the Commonwealth. According to section 2 of the Direction, the instrument comes into effect the day after it is registered. The Direction is made under the Terrorism Insurance Act 2003, as stated in section 3, and it incorporates definitions from that Act, as clarified in section 4. Section 5 of Part 2 details the specific payments to be made: $55 million as a guarantee fee, $35 million as a capital holding fee, and $10 million as a temporary dividend. These payments are mandated to be completed by 31 March 2021, with electronic transfer details provided for the Department of the Treasury's Official Administered Receipts Account.
The Terrorism Insurance (Payments) Direction 2020I imposes specific obligations on the Australian Reinsurance Pool Corporation. Primarily, it requires the Corporation to remit specified sums to the Commonwealth by a defined deadline. This obligation is clearly articulated in section 5 of the Direction, which mandates payments of $55 million for a guarantee fee, $35 million for a capital holding fee, and $10 million for a temporary dividend. These payments must be made electronically to the Department of the Treasury's Official Administered Receipts Account by 31 March 2021, as per the details provided. Failure to comply with these payment obligations could lead to legal repercussions, as outlined in the Terrorism Insurance Act 2003.
The Terrorism Insurance (Payments) Direction 2020I does not explicitly outline offences, penalties, or specific consequences for non-compliance within the Direction itself. However, the Terrorism Insurance Act 2003, under which the Direction is made, likely encompasses provisions for breaches of such obligations. Non-compliance with the Act's provisions could result in civil or criminal penalties, including fines or imprisonment, depending on the nature and severity of the breach. The specific penalties would be determined by the courts, taking into account the particular circumstances of the case.