Bills Digest No. 157 2000-01
Corporations (Securities Exchanges Levies) Bill 2001
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
Main Provisions
Endnotes
Contact Officer & Copyright Details
Corporations (Securities Exchanges Levies) Bill 2001
Date Introduced: 24 May
2001
House: House of Representatives
Portfolio: Treasury
Commencement: At the same time as the Corporations
Act 2001. It is intended that Act will commence on July 1 2001.
To impose levies for securities exchange
fidelity funds. This Bill, in substance, re-enacts the corresponding existing
provisions of the Corporations Law national scheme as a single piece of
Commonwealth legislation.
The principal Background to the issues giving rise to
this Bill can be found in the Bills Digests for the Corporations (Fees)
Bill 2001 and the Corporations Bill 2001(1).
Australia currently has three operational stock exchanges:
the Australian Stock Exchange (ASX), the Stock Exchange of Newcastle Limited
(NSX) and BSX Limited (located in Bendigo). At present, the ASX is the
only 'participating exchange'. It is a member of the Securities Exchange
Guarantee Corporation (SEGC) and is involved in the National Guarantee
Fund scheme(2).
Part 7.9 of the existing Corporations Law and the prospective
Corporations Act 2001 provide that non-participating exchanges
must establish and maintain a fidelity fund. The legislation provides
for initial membership, annual and additional levies to be paid to a securities
exchange as a fidelity fund contribution.
Clause 4 imposes initial membership, annual and
additional levies. The Explanatory Memorandum notes that these levies
are equivalent to those payable under section 902 of the Corporations
Law(3).
The relevant securities exchange is empowered to determine
the levy amounts. The limits on these levies are the same as currently
apply under the Corporations Law (clause 5). Liability to pay the
annual membership fidelity fund contribution will cease if the fund exceeds
$2 000 000 or a lower amount prescribed by regulation (clause
6).
Where a person has a liability to pay an annual fidelity
fund contribution or an additional contribution under section 902 of the
Corporations Law at the time of the commencement of the proposed Corporations
Act 2001, then subclauses 8(3) and (4) impose a new
liability to pay the levy. Determinations setting levy rates made prior
to the commencement of the proposed Corporations Act 2001 are preserved
by subclause 8(5).
- http://www.aph.gov.au/library/pubs/bd/2000-01/01BD140.htm
- The NGF is a compensation fund that is available to meet claims arising
from dealings with stockbrokers including where: a stockbroker transfers
securities without authority; or where the stockbroker becomes insolvent
and fails to meet its obligations to a person who had previously entrusted
property to it. For more information see: http://www.segc.com.au.
- p. 3.
Mark Tapley
15 June 2001
Bills Digest Service
Information and Research Services
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ISSN 1328-8091
© Commonwealth of Australia 2000
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Published by the Department of the Parliamentary Library, 2000.
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