Bills Digest no. 110 2009–10
Corporations (Fees) Amendment Bill
2010
WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments. This Digest does not have
any official legal status. Other sources should be consulted to determine
the subsequent official status of the Bill.
CONTENTS
Passage history
Purpose
Background
Financial implications
Main provisions
Concluding comments
Contact officer & copyright details
Passage history
Corporations (Fees) Amendment Bill
2010
Date introduced: 10 February 2010
House: House of Representatives
Portfolio: Treasury
Commencement: Sections 1–3 of the Bill commence on the day of Royal
Assent. The remaining provisions of this Bill commence at the same time as the
provisions of Schedule 1 of the Corporations Amendment (Financial Market
Supervision) Act 2010 (when enacted), commence.
Links: The relevant links to the Bill, Explanatory Memorandum
and second reading speech can be accessed via BillsNet, which is at http://www.aph.gov.au/bills/. When Bills have been passed they can
be found at ComLaw, which is at http://www.comlaw.gov.au/.
The Corporations (Fees) Amendment Bill
2010 (the Bill) supports the Corporations Amendment (Financial Market
Supervision) Bill 2010 (the Primary Bill).
The Bill amends the Corporations (Fees) Act 2001 (the
Fees Act) to enable ASIC to impose a fee on financial market operators in
relation to ASIC’s new market supervisory functions proposed in the Primary
Bill.[1]
For further information about the policy commitment behind
proposals in the Primary Bill, see the Bills Digest relating to the Primary
Bill.[2]
On 30 May 1996, the Treasurer of the time, announced an
Inquiry into Australia’s financial system (the Wallis Inquiry).[3]
In its report, the Wallis Inquiry recommended that
regulatory agencies should be self-funding by collecting sufficient revenue
from the financial entities that they regulate.[4] According to the Wallis Inquiry, the costs of regulation should be borne by
those who benefit by the regulation.[5]
As at 18 February 2010, the Standing Committee on the
Scrutiny of Bills had not yet released any comments on the Bill.
However, the Scrutiny of Bills Committee is likely to draw
attention to item 4 of this Bill, which provides that either the amount of the
fee for market supervision, or the method for calculating that fee, is to be
prescribed by regulation.
In addition, as at 18 February 2010, the Senate Standing
Committee on the Selection of Bills had not yet resolved whether to refer the
Bill to a parliamentary committee.
Major concerns for stakeholders are that the Bill does not
provide for sufficient transparency and accountability in proposed cost
recovery processes and that cost efficiencies that flow from existing
arrangements may, in fact, be lost in the new arrangements.[6]
The Government does not expect any financial impact on the
Government arising from proposed amendments in the Bill and expects that the
costs of levies imposed by the Bill will be off-set by market operators having
lower operational costs as they would no longer be supervising trading on their
markets.[7]
The Fees Act provides for fees and taxes to be imposed for
things done under the Corporations Act 2001.
‘Chargeable matter’ is defined in section 4 of the Fees Act
and item 1 of the Bill proposes to amend that definition by adding to it
ASIC’s supervision of financial markets functions as proposed in the Primary
Bill.
Section 6 of the Fees Act provides for matters
relating to the amount of fees in relation to chargeable matters as defined in
the Act.
Item 3 of the Bill proposes to amend section 6 by
inserting new subsection 6(6) into the Fees Act, to the effect that
section 6 would not apply to ASIC’s supervision of financial markets functions
as proposed in the Primary Bill.
Item 4 of the Bill then proposes to insert new
section 6A into the Fees Act, providing that regulations may prescribe a
fee for ASIC’s supervision of financial markets functions as proposed in the
Primary Bill, by specifying either a fee amount or a method of calculating such
amount.
The Explanatory Memorandum states that the Bill does not
place a cap on fee amounts because:
… the amount it will cost to supervise the market, and
therefore also the amount it will be necessary for ASIC to recover, will change
dramatically as financial markets enter and leave Australia, and as the amount
of trades executed on markets in Australia fluctuate in response to market
conditions. The formula for calculation of the levy on market operators will be
set out in the Regulations and will be consulted upon with industry before
being introduced.[8]
Section 7 of the Fees Act provides for liability to
pay fees for chargeable matters and time when such liability is incurred. Item
5 of the Bill proposes to amend subsection 7(1) of the Fees Act by specifying that licensed market operators would be liable for paying fees
and the regulations will specify when fees will be imposed.
Concluding
comments
The Bill further implements the recommendation made by the
Wallis Inquiry. However, as in the Primary Bill, the detail is yet to be seen
and cannot be commented on at this stage.
Members, Senators and
Parliamentary staff can obtain further information from the Parliamentary
Library on (02) 6277 2442.
Sharon Scully
22 February 2010
Bills Digest Service
Parliamentary Library
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