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February 28, 2010

ASIC consults on market integrity rules

ASIC has released Consultation Paper 131 Proposed ASIC Market Integrity Rules – ASX and SFE Markets (CP 131) which proposes market integrity rules to apply to trading on ASX and SFE markets, based on the existing rules of these markets, while clarifying the supervisory responsibilities of ASIC and market operators.

The paper contains an outline of a proposed approach to dealing with breaches of the rules, including details of a Markets Disciplinary regime as similar as possible to the current ASX disciplinary tribunal, with penalties consistent with the current approach.

ASIC is seeking feedback on these market integrity rules proposals by 26 March 2010

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Posted 28th February 2010 by David Jacobson in Corporations Act

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February 25, 2010

Bills update

The Corporations Amendment (Financial Market Supervision) Bill 2010 and the National Consumer Credit Protection Amendment Bill 2010 were passed by the House of Representatives on 23 February and introduced into the Senate on 24 February.

The Fairer Private Health Insurance Incentives (Medicare Levy Surcharge) Bill 2009 [No. 2] and the Fairer Private Health Insurance Incentives (Medicare Levy Surcharge—Fringe Benefits) Bill 2009 [No. 2] were defeated by a majority vote in the Senate on 24 February. These bills meet the requirements for a simultaneous dissolution of both houses under s.57 of the Constitution.

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Posted 25th February 2010 by David Jacobson in Credit Code 2009, Financial Services, Insurance

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Senate committee supports Bankruptcy Amendment Bill

The Senate Legal and Constitutional Affairs Legislation Committee has recommended that the Senate pass the Bankruptcy Legislation Amendment Bill 2009 in its present form.

One of the most contentious issues was the creditor’s petition threshold.

The Report states:

the committee considers it appropriate to increase the existing $2,000 threshold for a creditor’s petition to $10,000. The threshold should recognise significant changes in personal debt levels over the past 14 years, as well as the cost and complexity of bankruptcy proceedings (as compared with other available debt collection methods), and the magnitude of the consequences that bankruptcy has for a debtor. The committee adds that, in this day and age, it would be harsh and punitive to bankrupt an individual on the basis of a debt as low as $2,000. The committee accepts that $10,000 is an amount that appropriately balances the interests of all relevant parties.

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Posted 25th February 2010 by David Jacobson in Financial Services

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Senate committee supports Do Not Call Register extension

The Senate Environment, Communications, Information Technology and the Arts Committee has recommended that the Do Not Call Register Legislation Amendment Bill 2009 be passed.

The Committee said that “On balance, the committee does not believe that the costs of complying with the bill will be excessive or prohibitive.” It considered that any concerns could be dealt with by ACMA.

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Posted 25th February 2010 by David Jacobson in Do Not Call Register, Marketing

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ASIC relief for group insurance arrangements

ASIC has issued Class Order [CO 10/116] Group purchasing bodies – variation of Class Order [CO 08/1] to provide certainty about who will be eligible for relief and to introduce greater flexibility for compliance with the conditions of AFS licensing relief for the insurance industry and some group purchasing bodies.

Class Order [CO 08/1] provides conditional exemptions from the Australian financial services (AFS) licensing and managed investment scheme registration requirements for certain group purchasing bodies that arrange cover for third parties under insurance (excluding certain foreign insurance).

Regulatory Guide 195 Group purchasing bodies for insurance and risk products (RG 195), which sets out ASIC’s policy on the relief in [CO 08/1] has been revised to include more specific guidance and more ‘real life’ examples.

Group purchasing bodies may be eligible for the relief if they are independent or are acting incidentally to their not-for-profit activities. Conditions apply to the relief to ensure that the risks to people who receive financial services from group purchasing bodies are minimised.

The class order includes a breach reporting obligation which will come into effect from the first time that the group purchasing body acquires, renews or renegotiates the terms of the insurance cover on or after 30 June 2010 but in any event not later than 30 June 2011.

Group purchasing bodies arrange or hold cover under risk management products for others but do not issue risk management products or provide any financial product advice other than as a result of providing certain general information.

As group purchasing bodies generally do not just obtain cover for members on a one-off basis, they may be carrying on a financial services business and therefore require an AFS licence. Some group purchasing bodies may enter into arrangements that constitute a managed investment scheme that requires registration under the Corporations Act.

ASIC considers that requiring all group purchasing bodies to hold an AFS licence and comply with the management investment scheme registration requirements would impose a disproportionate cost burden on group purchasing bodies. The relief will ensure that eligible group purchasing bodies can continue to enter group purchasing arrangements for the benefit of their members or clients.

The class order will commence after it has been gazetted.

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Posted 25th February 2010 by David Jacobson in Financial Services, Insurance

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COAG performance report released

The COAG Reform Council has released its first report to the Council of Australian Governments (COAG) on performance against the National Partnership Agreement to Deliver a Seamless National Economy.

The National Partnership Agreement to Deliver a Seamless National Economy is an agreement by all Australian governments to deliver more consistent, better regulation across Australia, and reduce compliance costs on business, restrictions on competition, and distortions in the allocation of resources across the country.

The report by the COAG Reform Council is an assessment of the performance of the Commonwealth, State and Territory governments against the 2008–09 implementation milestones—across the 36 streams of business regulation and competition reform which all nine governments agreed to implement.

The CRC report:
• notes that overall, there has been good or satisfactory progress against 18 of the 27 deregulation priorities and four of the eight competition reforms;
• makes four recommendations aimed at making elements of the NP reform agenda more transparent, meaningful and measureable (which COAG has agreed to adopt); and
• incorporates in its progress assessment several National Reform Agenda priorities previously agreed by COAG in 2006 and 2007 (in relation to the trade measurement, rail safety, national construction code and energy competition reforms) that it considers have not been met and are relevant to some of the NP Implementation Plan milestones.

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Posted 25th February 2010 by David Jacobson in Deregulation_

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February 23, 2010

Proposed Changes to the Do Not Call Register Act

The Do Not Call Register Legislation Amendment Bill was introduced to Parliament late last year. It proposes to broaden the scope of the Do Not Call Register.

The Senate Environment, Communications and the Arts Legislation Committee is due to report on the Bill on 24 February.

The Do Not Call Register has been in operation since May 2007 and enables Australians to opt out of receiving unsolicited commercial marketing calls by registering fixed line and mobile telephone numbers that are primarily used for private and domestic purposes. The Register currently does not allow people to register phone numbers that are not used primarily for private or domestic purposes and dedicated fax lines.

The Bill proposes to broaden the scope of the Register to:

• allow the registration of all telephone and fax numbers, including numbers used by businesses and government departments;
• prohibit the sending of unsolicited marketing faxes to numbers on the Register; and
• allow new registrants the ability to choose whether they wish to either expressly consent to receiving phone calls or faxes from particular industry classifications or instead to opt out of receiving any marketing calls or faxes.

It will be an exception to an offence of making an unsolicited marketing call or sending an unsolicited marketing fax if the recipient had registered consent to receive marketing calls or faxes about an activity covered by a specific industry.

Article by Katrina Nitschke

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Posted 23rd February 2010 by David Jacobson in Do Not Call Register

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February 19, 2010

AML penalty moratorium to end

The relief granted for AML/CTF civil penalty breaches of the ongoing customer due diligence requirements and reporting of suspicious matters, threshold transactions and general reporting provisions during the transition period under the Policy (Civil Penalty Orders) Principles 2006 will end on 11 March 2010.

Under the Principles, relief from civil penalties for breaches of these provisions is given unless the AUSTRAC CEO is satisfied that the reporting entity has failed to take reasonable steps to comply with the provision.

Relief from breaches of the international funds transfer instructions requirements ends on 12 September 2010.

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Posted 19th February 2010 by David Jacobson in Anti-money laundering

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February 18, 2010

Insurance regulatory update

The Assistant Treasurer has given a regulatory update to the Insurance Council.

The update highlights the implications of the 2010 Integenerational Report, the Australian Financial Centre Forum and the Independent Tax Review for the insurance industry.

APRA Insurance update

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Posted 18th February 2010 by David Jacobson in Insurance

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February 16, 2010

Government proposes further regulatory reforms

The Government has released its Response to the OECD Report – Towards a Seamless National Economy, 2009 Review of Regulatory Reform: Australia .

The Australian Government ‘s response includes:

•further improving the Australian Government’s engagement with business to identify regulatory reform opportunities and concerns through establishing a formal consultation forum with business and using web 2.0 technologies;
•subject to the agreement of state and territory governments, developing approaches to identifying and managing new regulatory proposals at the local level which could affect the operation of national markets;
•a number of initiatives to improve the effectiveness of regulatory impact assessment; and
•enhancing the transparency of regulation‑making by requiring regulatory agencies to report publicly on how they will ensure regulations do not impose unnecessary costs on business.

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Posted 16th February 2010 by David Jacobson in Deregulation_

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