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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