Australian Charities and Not-for-profits Commission Act 2012

This Act may be cited as the Australian Charities and Not‑for‑profits Commission Act 2012.

(1) Each provision of this Act 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
Provision(s)	Commencement	Date/Details
1. Sections 5‑5 and 5‑10 and anything in this Act not elsewhere covered by this table	The day this Act receives the Royal Assent.	3 December 2012
2. Sections 5‑15 to 300‑5	The later of: (a) 1 October 2012; and (b) the day the Australian Charities and Not‑for‑profits Commission (Consequential and Transitional) Act 2012 receives the Royal Assent. However, the provision(s) do not commence at all if the event mentioned in paragraph (b) does not occur.	3 December 2012

Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.

(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.

5‑15 Crown to be bound

(1) This Act binds the Crown in each of its capacities.

(2) This Act does not make the Crown liable to a pecuniary penalty or to be prosecuted for an offence.

5‑20 Extension to external Territories

This Act extends to every external Territory.

Division 10—Guide to this Act

10‑5 Guide to this Act

The following is a guide to this Act:

This Act establishes a regulatory system for not‑for‑profit entities.

This Act establishes a national regulator for not‑for‑profit entities. The regulator is the Commissioner of the Australian Charities and Not‑for‑profits Commission (the ACNC).

The Commissioner is responsible for registering entities as not‑for‑profit entities according to their type and subtypes. Registration with the ACNC is a necessary precondition for access to certain Commonwealth taxation concessions. Registration under this Act may also be a prerequisite for other exemptions, benefits and concessions provided under other Australian laws.

The Commissioner of the ACNC will cooperate with other government agencies to oversee a simplified and streamlined regulatory framework for not‑for‑profit entities.

The Commissioner of the ACNC will provide information to help the public understand the work of the not‑for‑profit sector and to support the transparency and accountability of the sector.

Part 1‑2—Objects of this Act

Division 15—Objects of this Act

15‑5 Objects of this Act

(1) The objects of this Act are:

(a) to maintain, protect and enhance public trust and confidence in the Australian not‑for‑profit sector; and

(b) to support and sustain a robust, vibrant, independent and innovative Australian not‑for‑profit sector; and

(2) This Act achieves those objects by:

(a) establishing a national regulatory framework for not‑for‑profit entities that reflects the unique structures, funding arrangements and goals of such entities; and

(b) establishing the Commissioner of the Australian Charities and Not‑for‑profits Commission, who will:

(i) be responsible for registering entities as not‑for‑profit entities according to their type and subtypes; and

(ii) administer the national regulatory framework; and

(iii) assist registered entities in complying with and understanding this Act, by providing them with guidance and education.

(3) Registration is a prerequisite for an entity to access certain Commonwealth tax concessions.

(4) Registration under this Act may also be a prerequisite for other exemptions, benefits and concessions provided under other Australian laws.

15‑10 Commissioner to have regard to certain matters in exercising powers and functions

In performing his or her functions and exercising his or her powers, the Commissioner must have regard to the following:

(a) the maintenance, protection and enhancement of public trust and confidence in the not‑for‑profit sector;

(b) the need for transparency and accountability of the not‑for‑profit sector to the public (including donors, members and volunteers of registered entities) by ensuring the public has access to information about not‑for‑profit entities;

(d) the maintenance and promotion of the effectiveness and sustainability of the not‑for‑profit sector;

(e) the following principles:

(i) the principle of regulatory necessity;

(ii) the principle of reflecting risk;

(iii) the principle of proportionate regulation;

(f) the need for the Commissioner:

(i) to cooperate with other Australian government agencies; and

(ii) to administer effectively the laws that confer functions and powers on the Commissioner;

(including in order to minimise procedural requirements and procedural duplication);

(g) the benefits gained from assisting registered entities in complying with and understanding this Act, by providing them with guidance and education;

(h) the unique nature and diversity of not‑for‑profit entities and the distinctive role that they play in Australia.

Chapter 2—Registration of not‑for‑profit entities

Part 2‑1—Registration

Division 20—Object of this Part

20‑5 Object of this Part

Tax concessions

(1) This Part provides for the Commissioner to register entities as particular types and subtypes of not‑for‑profit entities. It also provides for the Commissioner to revoke the registration of registered entities.

(2) Such registration is a prerequisite for an entity to access certain Commonwealth tax concessions. The object of this Part is to ensure that these tax concessions are available only to entities that are governed and regulated in accordance with this Act.

Other concessions

(3) Registration under this Act may also be a prerequisite for other exemptions, benefits and concessions provided under other Australian laws.

Division 25—Entitlement to registration

25‑1 Simplified outline

The following is a simplified outline of this Division:

A not‑for‑profit entity is entitled to registration under this Act as a type of entity if certain conditions are satisfied.

A not‑for‑profit entity is entitled to registration under this Act as a subtype of entity if certain conditions are satisfied (including that the entity is registered as a type of entity).

25‑5 Entitlement to registration

(1) An entity is entitled to registration as a type of entity if:

(a) it meets the conditions in subsection (3); and

(b) it meets the description of that type of entity in column 1 of the table in subsection (5); and

(c) if the entity has previously been a registered entity, but its registration as a type of entity has been revoked—the Commissioner is satisfied that the matters which led to the revocation have been dealt with such that the registration of the entity would not conflict with the objects of this Act.

Note: Registration of an entity mentioned in paragraph (c) has effect from the time of registration (see section 30‑30). It does not rescind the revocation of the previous registration.

(2) An entity is entitled to registration as a subtype of entity if:

(a) it meets the conditions in subsection (3); and

(b) it meets the description of that subtype of entity in column 2 of the table in subsection (5); and

(c) it is entitled to registration as the type of entity that corresponds to that subtype of entity (as set out in that table); and

(d) it is registered as that type of entity.

(3) The conditions are as follows:

(a) the entity is a not‑for‑profit entity;

(b) the entity is in compliance with the governance standards and external conduct standards (see Part 3‑1);

(d) the entity is not covered by a decision in writing made by an Australian government agency (including a judicial officer) under an Australian law that provides for entities to be characterised on the basis of them engaging in, or supporting, terrorist or other criminal activities.

(4) To avoid doubt, an entity may be entitled to registration as more than one subtype of entity.

Note: An entity could be registered as an entity with a purpose of advancing social or public welfare, and also be registered as a public benevolent institution.

(5) The table is as follows:

Entitlement to registration
Item	Column 1 Type of entity	Column 2 Corresponding subtype of entity
1	Charity	Entity with a purpose to which paragraph (a) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (advancing health)
2		Entity with a purpose to which paragraph (b) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (advancing education)
3		Entity with a purpose to which paragraph (c) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (advancing social or public welfare)
4		Entity with a purpose to which paragraph (d) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (advancing religion)
5		Entity with a purpose to which paragraph (e) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (advancing culture)
6		Entity with a purpose to which paragraph (f) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (promoting reconciliation, mutual respect and tolerance between groups of individuals that are in Australia)
7		Entity with a purpose to which paragraph (g) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (promoting or protecting human rights)
8		Entity with a purpose to which paragraph (h) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (advancing the security or safety of Australia or the Australian public)
9		Entity with a purpose to which paragraph (i) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (preventing or relieving the suffering of animals)
10		Entity with a purpose to which paragraph (j) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (advancing the natural environment)
11		Entity with a purpose to which paragraph (k) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (purposes beneficial to the general public and analogous to the other charitable purposes)
12		Entity with a purpose to which paragraph (l) of the definition of charitable purpose in subsection 12(1) of the Charities Act 2013 applies (advancing public debate)
13		Institution whose principal activity is to promote the prevention or the control of diseases in human beings
14		Public benevolent institution

Note 1: For the definition of charity, see the Charities Act 2013.

Note 2: An entity commonly known as a health promotion charity could be an entity described in column 2 of item 13 of the table (institution whose principal activity is to promote the prevention or the control of diseases in human beings).

Trusts

(6) Section 18 of the Charities Act 2013 (Cy pres and similar schemes) applies:

(a) for the purposes of this Act; or

(b) for the purposes of determining whether an entity meets the description of a type or subtype of entity in the table in subsection (5) of this section;

in the same way as that section 18 applies for the purposes of that Act.

Division 30—Process of registration

30‑1 Simplified outline

The following is a simplified outline of this Division:

This Division outlines the process for the registration of entities as a type and subtypes.

The Commissioner must register an entity if the entity applies in the approved form, is entitled to registration and has given the Commissioner all necessary information and documents.

30‑5 Application of this Division to various kinds of registration

This Division applies separately in relation to each of the following kinds of registration:

(a) registration as a type of entity;

(b) registration as a subtype of entity.

30‑10 Applying for registration

(1) An entity may apply to the Commissioner for registration.

(2) The application must be in the approved form.

30‑15 Dealing with an application for registration

Requiring further information or documents

(1) The Commissioner may require an applicant to give the Commissioner specified information, or a specified document, that the Commissioner needs in order to decide whether the applicant is entitled to registration.

Treating application as being refused

(2) After the time worked out under subsection (3), the applicant may give the Commissioner, in the approved form, written notice that the applicant wishes to treat the application as having been refused, if the Commissioner has not given the applicant before that time written notice that the Commissioner has registered or has refused to register the applicant.

Note: Section 30‑25 requires the Commissioner to give the applicant written notice if the Commissioner has registered or has refused to register the applicant.

(3) The time is the end of the 60th day after the application was made. However, if before that time the Commissioner requires the applicant under subsection (1) to give information or a document, the time is the later of the following (or either of them if they are the same):

(a) the end of the 28th day after the last day on which the applicant gives the Commissioner information or a document that the Commissioner has required under subsection (1);

(b) the end of the 60th day after the application was made.

(4) If the applicant gives notice under subsection (2), section 30‑35 operates as if the Commissioner refuses the application on the day on which the notice is given.

Note: Section 30‑35 lets the applicant object against refusal of an application in the manner set out in Part 7‑2.

30‑20 Registration of entity

The Commissioner must register the applicant if:

(a) the application is in the approved form; and

(b) if the Commissioner has required the applicant under subsection 30‑15(1) to give information or a document—the applicant has given the Commissioner that information or document; and

30‑25 Notifying outcome of application for registration

The Commissioner must give the applicant written notice if:

(a) the Commissioner registers the applicant; or

(b) the Commissioner refuses to register the applicant.

30‑30 Date of effect of registration

The registration has effect from a date specified by the Commissioner.

30‑35 Review of refusal of registration

If the applicant is dissatisfied with the Commissioner’s refusal to register the applicant in accordance with the application, the applicant may object against the refusal in the manner set out in Part 7‑2.

Division 35—Revoking registration

35‑1 Simplified outline

The following is a simplified outline of this Division:

The Commissioner may revoke an entity’s registration under this Act if the Commissioner reasonably believes that any of certain conditions exist. These conditions include the following:

(a) the entity not being entitled to registration;

(b) the entity contravening this Act or not complying with a governance standard or external conduct standard;

(c) the entity providing information that was false or misleading in a material particular in its application for registration;

(d) the entity requesting that the Commissioner revoke the registration.

The Commissioner must consider a range of factors before revoking a registered entity’s registration under this Act.

If the Commissioner believes on reasonable grounds that a registered entity is not entitled to be registered, the Commissioner may give a show cause notice to the entity.

35‑5 Application of this Division to various kinds of registration

(1) This Division applies separately in relation to each of the following kinds of registration:

(a) registration as a type of entity;

(b) registration as a subtype of entity.

(2) However, the Commissioner must revoke a registered entity’s registration as a subtype of entity if the Commissioner revokes the entity’s registration as the type of entity that corresponds to that subtype (as set out in the table in subsection 25‑5(5)).

35‑10 Revoking registration

(1) The Commissioner may revoke the registration of a registered entity if the Commissioner reasonably believes that any of the following conditions are met:

(a) at any time after the date of effect of the registration, the entity is or was not entitled to registration;

(b) the registered entity provided, in connection with its application for registration, information that was false or misleading in a material particular;

(i) the registered entity has contravened a provision of this Act, or it is more likely than not that the registered entity will contravene a provision of this Act; or

(ii) the registered entity has not complied with a governance standard or external conduct standard, or it is more likely than not that the registered entity will not comply with such a standard;

(d) the registered entity has:

(i) a trustee in bankruptcy; or

(ii) a liquidator; or

(iii) a person appointed, or authorised, under an Australian law to manage the affairs of the entity because it is unable to pay all its debts as and when they become due and payable;

(e) the registered entity has made a request to the Commissioner, in the approved form, that the Commissioner revoke the registration.

(2) In deciding whether to revoke the registration of an entity the Commissioner must take account of the following matters:

(a) the nature, significance and persistence of any contravention of this Act or non‑compliance with a governance standard or external conduct standard (or any such contravention or non‑compliance that is more likely than not) by the registered entity;

(b) what action the Commissioner, the registered entity, or any of the responsible entities of the registered entity, could take or have taken:

(i) to address any such contravention or non‑compliance (or prevent any such contravention or non‑compliance that is more likely than not); or

(ii) to prevent any similar contravention or non‑compliance;

(c) the desirability of ensuring that contributions (see section 205‑40) to the registered entity are applied consistently with the not‑for‑profit nature, and the purpose, of the registered entity;

(d) the objects of any Commonwealth laws that refer to registration under this Act;

(e) the extent (if any) to which the registered entity is conducting its affairs in a way that may cause harm to, or jeopardise, the public trust and confidence in the not‑for‑profit sector mentioned in subsection 15‑5(1) (Objects of this Act);

(f) the welfare of members of the community (if any) that receive direct benefits from the registered entity;

(g) any other matter that the Commissioner considers relevant.

(3) The revocation must specify the day on which the entity’s registration is taken to be revoked. The specified day must be:

(a) if the reason for the revocation is that the entity is not entitled to registration:

(i) the day on which the entity first ceased to be entitled; or

(ii) a later day; or

(b) if the reason for the revocation is that the entity provided, in connection with its application for registration, information that was false or misleading in a material particular:

(i) the day on which the registration took effect; or

(ii) a later day; or

(i) the day on which the revocation is made; or

(ii) a later day.

(4) The Commissioner must give the entity written notice within 14 days if the Commissioner revokes its registration.

35‑15 Notice to registered entity to show cause

(1) Before revoking the registration, the Commissioner must give a written notice (a show cause notice) to the registered entity.

(2) The show cause notice must:

(a) state the grounds on which the Commissioner proposes to revoke the registration; and

(b) invite the registered entity to give the Commissioner, within 28 days after the day the notice is given, a written statement showing cause why the Commissioner should not revoke the registration.

(3) This section does not apply if the Commissioner believes, on reasonable grounds and taking into account the matters mentioned in subsection 35‑10(2), that it would be appropriate for the Commissioner to revoke the registration without giving a show cause notice to the registered entity.

35‑20 Review of revocation of registration

If the entity is dissatisfied with the revocation of its registration or a decision by the Commissioner to not revoke the entity’s registration, the entity may object against the revocation or decision in the manner set out in Part 7‑2.

Part 2‑2—Australian Charities and Not‑for‑profits Register

Division 40—Australian Charities and Not‑for‑profits Register

40‑1 Simplified outline

The following is a simplified outline of this Division:

This Division provides for the Australian Charities and Not‑for‑profits Register. The Register contains information about each registered entity and each former registered entity.

The Commissioner must publish the Register on the internet, but may, subject to the public interest, withhold certain information from such publication.

40‑5 Commissioner to maintain Australian Charities and Not‑for‑profits Register

Information

(1) The Commissioner is to maintain a register (known as the Australian Charities and Not‑for‑profits Register) in which the Commissioner includes the following information:

(a) the following information in respect of each registered entity:

(i) the entity’s name;

(ii) the entity’s contact details (including its address for service);

(iii) the entity’s ABN;

(iv) the type of entity as which it is registered or has been registered;

(v) each subtype of entity (if any) as which it is registered or has been registered;

(vi) the date of effect of each such registration;

(vii) the entity’s governing rules;

(b) the following information in respect of each former registered entity:

(i) the entity’s name;

(ii) the entity’s ABN;

(iii) the type of entity as which it was registered;

(iv) each subtype of entity (if any) as which it was registered;

(v) the date of effect of each such registration;

(vi) the entity’s governing rules;

(i) the name of each responsible entity;

(ii) the position held by the responsible entity in relation to the registered entity;

(d) information statements given by registered entities under Division 60 (except to the extent (if any) that information in an information statement is classified, in the approved form mentioned in section 60‑5, as “not for publication”);

(e) financial reports, and any audit or review reports, given by registered entities under Division 60;

(f) the details of the following matters (including a summary of why the matter arose, details regarding any response by the relevant registered entity and the resolution (if any) of the matter):

(i) each warning issued to a registered entity by the Commissioner under Division 80;

(ii) each direction issued to a registered entity by the Commissioner under Division 85;

(iii) each undertaking given by a registered entity and accepted by the Commissioner under Division 90;

(iv) each injunction (including interim injunctions) made under Division 95;

(v) each suspension or removal made under Division 100;

(g) any other information:

(i) that the Commissioner is authorised to collect under a provision of this Act; and

(ii) that is specified in the regulations.

Note: Regulations made for the purposes of subsection 40‑10(1) may provide that the Commissioner must not include information on the Register in certain circumstances.

(2) The Commissioner must not include the information mentioned in paragraph (1)(f) before the end of 14 days after the day the warning or direction is issued, the undertaking is given, the injunction is made or the suspension or removal occurs, unless the Commissioner considers that the public interest requires the information to be included earlier.

(3) The Register is to be maintained by electronic means.

(4) The Register is to be made available for public inspection on the internet.

Note: See section 150‑35 for limitations on including personal information on the Register.

40‑10 Commissioner may withhold or remove information from Register

(1) Regulations made for the purposes of this subsection may provide that the Commissioner must not include information on the Register, or must remove information from the Register, in prescribed circumstances.

(2) The Commissioner may decline to include information on the Register, or may remove information from the Register, if the Commissioner considers that any of the following circumstances exist:

(a) the information:

(i) is commercially sensitive; and

(ii) has the potential to cause detriment to the registered entity (or former registered entity) to which it relates, or to an individual;

(b) the information is inaccurate, is likely to cause confusion or is likely to mislead the public;

(d) the information could endanger public safety;

(da) all of the following subparagraphs apply:

(i) the information is the details of a warning issued to a registered entity by the Commissioner under Division 80, as mentioned in paragraph 40‑5(1)(f);

(ii) the information has the potential to cause detriment to the entity, or to an individual;

(iii) the contravention, likely contravention, non‑compliance or likely non‑compliance mentioned in subsection 80‑5(1) was not, or would not be, in bad faith;

(iv) the contravention, likely contravention, non‑compliance or likely non‑compliance has been dealt with, or prevented, such that declining to include the information, or removing the information, would not conflict with the objects of this Act;

(e) any circumstances prescribed by the regulations for the purposes of this paragraph.

(3) However, the Commissioner may include the information on the Register, or decline to remove information from the Register, if the Commissioner considers that the public interest in the Register including the information outweighs the likely adverse effect of the relevant circumstance or circumstances set out in paragraphs (2)(a) to (e).

(4) The Commissioner may remove information mentioned in paragraph 40‑5(1)(f) from the Register if:

(a) the information has been on the Register for more than 5 years; and

(b) the Commissioner considers that the public interest does not require the information to be retained on the Register.

Chapter 3—Responsibilities of registered entities

Part 3‑1—Governance standards and external conduct standards

Division 45—Governance standards

45‑1 Simplified outline

The following is a simplified outline of this Division:

This Division sets up a system to allow the creation of minimum governance standards that entities are required to meet (in order to become registered, and on an ongoing basis). These governance standards are to be set out in the regulations.

Compliance with the governance standards is a condition of entitlement to registration under paragraph 25‑5(3)(b).

The object of the system setting up the standards is to provide a minimum level of confidence that registered entities will promote the effective and efficient use of their resources, will meet community expectations about managing their affairs and the use of public money, volunteer time and donations, and will minimise the risk of mismanagement and misappropriation.

45‑5 Object of this Division

(1) The object of this Division is to promote the objects of this Act by giving the public (including donors, members and volunteers of registered entities) confidence that registered entities:

(a) manage their affairs openly, accountably and transparently; and

(b) use their resources (including contributions and donations) effectively and efficiently; and

(d) pursue their purposes.

Note: The objects of this Act include supporting and sustaining a robust, vibrant, independent and innovative Australian not‑for‑profit sector (see subsection 15‑5(1)).

(2) This Division achieves that object by setting up a system to allow the regulations to specify standards with which an entity must comply in order to become registered under this Act, and to remain entitled to be registered under this Act.

Note 1: The main consequence of failure to comply with these standards is a loss of the entity’s entitlement to registration. If the entity is a federally regulated entity, such a failure to comply may also result in enforcement action under Chapter 4.

Note 2: For the consequences of registration, see section 20‑5.

Note 3: A registered entity must notify the Commissioner of significant non‑compliance with these standards that results in the entity no longer being entitled to be registered (see section 65‑5).

45‑10 Regulations establishing governance standards

(1) The regulations may specify standards (the governance standards) with which an entity must comply in order to become registered under this Act, and to remain entitled to be registered under this Act.

(2) Without limiting the scope of subsection (1), those standards may:

(a) require the entity to ensure that its governing rules provide for a specified matter; or

(b) require the entity to achieve specified outcomes and:

(i) not specify how the entity is to achieve those outcomes; or

(ii) specify principles as to how the entity is to achieve those outcomes; or

(2A) Without limiting subparagraph (2)(b)(ii), the principles mentioned in that subparagraph may reflect the size of the entity, the amount and nature of contributions to the entity and the nature of the activities undertaken by the entity in pursuit of its purposes.

(3) Without limiting the scope of subsection (1), those standards may provide that specified requirements do not apply to specified kinds of entity.

(4) Without limiting the scope of subsection (1), those standards may provide that different requirements apply to different kinds of entity.

Basic religious charities

(5) The regulations must not require a registered entity to do, or not to do, a thing (including the things mentioned in subsection (2)) if the registered entity is a basic religious charity.

Political advocacy

(6) The regulations must not require an entity not to comment on, or advocate support for, a change to any matter established by law, policy or practice in the Commonwealth, a State, a Territory or another country, if:

(a) the comment or advocacy furthers, or is in aid of, the purpose of the entity; and

(b) the comment or advocacy is lawful.

45‑15 Consultation

(1) Before the Governor‑General makes a regulation for the purposes of subsection 45‑10(1), the Minister must be satisfied that:

(a) appropriate consultation has been undertaken with:

(i) the not‑for‑profit sector (such as through entities that represent parts of the sector); and

(ii) entities having expertise in fields relevant to the proposed regulation; and

(iii) entities likely to be affected by the proposed regulation; and

(iv) the Commissioner; and

(b) relevant input received as part of that consultation has been taken into account adequately.

(2) Without limiting, by implication, the form that consultation mentioned in paragraph (1)(a) might take, consultation to which all of the following paragraphs apply is appropriate consultation:

(a) the consultation involves consultation with the public;

(b) the consultation involves:

(i) notifying, directly and by advertisement, the entities mentioned in paragraph (1)(a) of the consultation; and

(ii) inviting them to make submissions by a specified date and, where necessary, to participate in public hearings to be held concerning the proposed regulation;

(3) The fact that consultation does not occur, or that input is not taken into account, does not affect the validity or enforceability of the regulation.

(4) Section 17 (consultation) of the Legislation Act 2003 does not apply to a regulation proposed to be made for the purposes of subsection 45‑10(1) of this Act.

45‑20 Parliamentary scrutiny of standards

Despite subsection 12(1) of the Legislation Act 2003, a provision of a regulation made for the purposes of subsection 45‑10(1) of this Act does not commence until the day after the earlier of:

(a) if both Houses of the Parliament pass a resolution approving the provision—the day the resolution is passed by the second House to do so; and

(b) the last day on which the regulation could be disallowed in either House, unless:

(i) the regulation is disallowed; or

(ii) either House passes a resolution disapproving the provision;

on or before that day.

Division 50—External conduct standards

50‑1 Simplified outline

The following is a simplified outline of this Division:

This Division sets up a system to allow the creation of minimum external conduct standards that entities are required to meet (in order to become registered, and on an ongoing basis). These external conduct standards are to be set out in the regulations and must deal only with:

(a) matters external to Australia; or

(b) matters not external to Australia but that are closely related to, or have or will have a significant impact on, entities, things or matters external to Australia.

Compliance with the external conduct standards is a condition of entitlement to registration under paragraph 25‑5(3)(b).

50‑5 Object of this Division

(1) The object of this Division is to give the public (including donors, members and volunteers of registered entities) confidence that:

(a) funds sent outside Australia by registered entities:

(i) are reaching legitimate beneficiaries; and

(ii) are being used for legitimate purposes; and

(iii) are not contributing to terrorist, or other criminal, activities; and

(b) activities engaged in outside Australia by registered entities are not contributing to terrorist, or other criminal, activities.

(2) This Division achieves that object by setting up a system to allow the regulations to specify standards:

(a) with which an entity must comply in order to become registered under this Act, and to remain entitled to be registered under this Act; and

(b) regulating funds sent outside Australia by registered entities, and activities engaged in outside Australia by registered entities.

Note 1: The main consequence of failure to comply with these standards is a loss of the entity’s entitlement to registration. Such a failure to comply may also result in enforcement action under Chapter 4.

Note 2: For the consequences of registration, see section 20‑5.

50‑10 External conduct standards

(1) The regulations may specify standards (the external conduct standards) with which an entity must comply in order to become registered under this Act, and to remain entitled to be registered under this Act.

(2) Without limiting the scope of subsection (1), those standards may:

(a) require the entity to ensure that its governing rules provide for a specified matter; or

(b) require the entity to achieve specified outcomes and:

(i) not specify how the entity is to achieve those outcomes; or

(ii) specify principles as to how the entity is to achieve those outcomes; or

(3) However, the external conduct standards must deal only with:

(a) matters external to Australia; or

(b) matters not external to Australia but that are closely related to, or have or will have a significant impact on, entities, things or matters external to Australia.

50‑15 Consultation

(1) Before the Governor‑General makes a regulation for the purposes of subsection 50‑10(1), the Minister must be satisfied that:

(a) appropriate consultation has been undertaken with:

(i) the not‑for‑profit sector (such as through entities that represent parts of the sector); and

(ii) entities having expertise in fields relevant to the proposed regulation; and

(iii) entities likely to be affected by the proposed regulation; and

(iv) the Commissioner; and

(b) relevant input received as part of that consultation has been taken into account adequately.

(2) Without limiting, by implication, the form that consultation mentioned in paragraph (1)(a) might take, consultation to which all of the following paragraphs apply is appropriate consultation:

(a) the consultation involves consultation with the public;

(b) the consultation involves:

(i) notifying, directly and by advertisement, the entities mentioned in paragraph (1)(a) of the consultation; and

(ii) inviting them to make submissions by a specified date and, where necessary, to participate in public hearings to be held concerning the proposed regulation;

(3) The fact that consultation does not occur, or that input is not taken into account, does not affect the validity or enforceability of the regulation.

(4) Section 17 (consultation) of the Legislation Act 2003 does not apply to a regulation proposed to be made for the purposes of subsection 50‑10(1) of this Act.

50‑20 Parliamentary scrutiny of standards

Despite subsection 12(1) of the Legislation Act 2003, a provision of a regulation made for the purposes of subsection 50‑10(1) of this Act does not commence until the day after the earlier of:

(a) if both Houses of the Parliament pass a resolution approving the provision—the day the resolution is passed by the second House to do so; and

(b) the last day on which the regulation could be disallowed in either House, unless:

(i) the regulation is disallowed; or

(ii) either House passes a resolution disapproving the provision;

on or before that day.

Part 3‑2—Record keeping and reporting

Division 55—Record keeping

55‑1 Simplified outline

The following is a simplified outline of this Division:

This Division sets out record keeping obligations for registered entities under this Act.

55‑5 Registered entities must keep records

Registered entities must keep records

(1) A registered entity must keep written financial records that:

(a) correctly record and explain its transactions and financial position and performance; and

(b) enable true and fair financial statements to be prepared and to be audited;

so as to enable any recognised assessment activity to be carried out in relation to the entity.

(2) A registered entity must also keep written records that correctly record its operations, so as to enable any recognised assessment activity to be carried out in relation to the entity.

(3) The records must be:

(a) in English; or

(b) readily accessible and easily convertible into English.

Registered entities must retain records

(4) Subject to subsection (5), the registered entity must retain the records for 7 years after the transactions, operations or acts covered by the records are completed.

(5) The Commissioner may notify the entity in writing that it does not need to retain certain records under subsection (4).

Offence

(6) A registered entity commits an offence if the entity does not comply with this section.

Penalty: 20 penalty units.

(7) An offence against subsection (6) is an offence of strict liability.

Note: For strict liability, see section 6.1 of the Criminal Code.

55‑10 Recognised assessment activity

A recognised assessment activity, in relation to a registered entity, is:

(a) an activity carried out by the Commissioner involving assessment of the entity’s entitlement to registration as a type or subtype of entity; or

(b) an activity carried out by the Commissioner involving assessment of the entity’s compliance with this Act and the regulations; or

(c) an activity carried out by the Commissioner of Taxation involving assessment of the entity’s compliance with any taxation law.

Division 60—Reporting

Subdivision 60‑A—Overview

60‑1 Simplified outline

The following is a simplified outline of this Division:

This Division sets out the reporting obligations for registered entities based upon the entity’s size and determined according to whether the entity is a small, medium or large registered entity.

All registered entities must provide the Commissioner with an annual information statement.

Medium and large entities must also provide the Commissioner with a financial report. Generally, financial reports need to be reviewed for medium entities or audited for large entities.

Additional reporting obligations may be placed on registered entities by the Commissioner in special circumstances, for example, if the Commissioner is concerned about an entity’s compliance with this Act.

Subdivision 60‑AA—Object of this Division

60‑3 Object of this Division

(1) The object of this Division is to promote:

(a) the transparency and accountability of registered entities; and

(b) the reduction of reporting obligations of registered entities under other Australian laws.

(2) The Division does this by requiring registered entities to provide information to the Commissioner that:

(a) relates to this Act or the taxation law; and

(b) the Commissioner:

(i) will use for the purposes of this Act; or

(ii) may pass on to other Australian government agencies, removing the need for those agencies to require the information from the registered entities; or

(iii) will make publicly available by publishing it on the Register.

Note 1: Other Australian laws provide that giving information to the Commissioner in accordance with this Act satisfies the reporting requirements of those laws.

Note 2: Division 40 limits the information the Commissioner may publish on the Register.

(3) The requirements this Division places on a registered entity are proportional to the size of the registered entity.

Subdivision 60‑B—Annual information statements

60‑5 Registered entities must give annual information statements

(1) A registered entity must give a statement (an information statement) for a financial year to the Commissioner in the approved form.

Note: The Commissioner may approve different approved forms for different entities (see subsection 190‑10(4)). For example, different forms could be approved for small, medium and large registered entities.

(2) The registered entity must give the information statement to the Commissioner no later than 31 December in the following financial year.

Note 1: Section 190‑15 allows the Commissioner to defer the time for giving an approved form.

Note 2: Section 175‑35 provides for an administrative penalty for failing to give the Commissioner a statement required by this Act within the required time.

(3) Any information that the approved form requires to be provided to the Commissioner must be information that relates to, or has the purpose of, enabling recognised assessment activities to be carried out in relation to registered entities.

Subdivision 60‑C—Annual financial reports

60‑10 Medium and large registered entities must give annual financial reports

(1) A medium registered entity or a large registered entity must give the Commissioner a financial report for a financial year, together with any auditor’s report or reviewer’s report that the entity is required to obtain under section 60‑20 or 60‑25.

(2) The registered entity must give the reports to the Commissioner no later than 31 December in the following financial year or such later time as the Commissioner allows.

Note: Section 175‑35 provides for an administrative penalty for failing to give the Commissioner a statement required by this Act within the required time.

60‑15 Requirements for annual financial reports

(1) The financial report must comply with the requirements set out in the regulations.

(2) Any information that the regulations require to be provided to the Commissioner must be information that relates to, or has the purpose of, enabling recognised assessment activities to be carried out in relation to registered entities.

60‑20 Medium registered entities must have annual financial reports audited or reviewed

(1) A medium registered entity must:

(a) subject to subsection (2), do both of the following:

(i) have its financial report for a financial year reviewed in accordance with this Subdivision;

(ii) obtain a reviewer’s report; or

(b) do both of the following:

(i) have its financial report for a financial year audited in accordance with this Subdivision;

(ii) obtain an auditor’s report.

(2) The Commissioner may, by written notice given to the medium registered entity, provide that paragraph (1)(a) does not apply to the financial report.

60‑25 Large registered entities must have annual financial reports audited

A large registered entity must:

(a) have its financial report for a financial year audited in accordance with this Subdivision; and

(b) obtain an auditor’s report.

60‑30 Audit or review

(1) The audit or review must be undertaken by:

(a) a registered company auditor (within the meaning of the Corporations Act 2001); or

(b) a firm:

(i) that consents to be appointed, or is appointed, as auditor of a registered entity; and

(ii) at least one member of which is a registered company auditor (within the meaning of that Act) who is ordinarily resident in Australia; or

(d) an entity prescribed by the regulations for the purposes of this paragraph.

(2) In the case of a review of the financial report of a medium registered entity, an individual who is taken to be a registered company auditor under subsection 324BE(1) of the Corporations Act 2001 is taken to be a registered company auditor for the purposes of this Subdivision.

Note: Subsection 324BE(1) of the Corporations Act 2001 allows certain members of professional accounting bodies who are not registered company auditors to undertake a review.

(3) In the case of an audit, the auditor must form an opinion about:

(a) whether the financial report satisfies the requirements of this Division; and

(b) whether the auditor has been given all information, explanation and assistance necessary for the conduct of the audit; and

(c) whether the registered entity has kept financial records sufficient to enable a financial report to be prepared and audited; and

(d) whether the registered entity has kept other records as required by this Part.

(4) In the case of a review, the reviewer must form a conclusion about:

(a) whether, on the basis of the review, anything has come to the reviewer’s attention that causes the reviewer to believe that the financial report does not satisfy the requirements of this Division; and

(b) whether the reviewer has been given all information, explanation and assistance necessary for the conduct of the review; and

(c) whether the registered entity has kept financial records sufficient to enable a financial report to be prepared and reviewed; and

(d) whether the registered entity has kept other records as required by this Part.

60‑35 Audit or review to be conducted in accordance with auditing standards

An audit or review must be undertaken in accordance with the auditing standards.

60‑40 Auditor’s or reviewer’s independence declaration

(1) A registered entity must obtain from its auditor or reviewer:

(a) a written declaration that, to the best of the auditor’s or reviewer’s knowledge and belief, there have been no contraventions of any applicable code of professional conduct in relation to the audit or review; or

(b) a written declaration that, to the best of the auditor’s or reviewer’s knowledge and belief, the only contraventions of any applicable code of professional conduct in relation to the audit or review are those contraventions details of which are set out in the declaration.

(2) The declaration must be signed by the auditor or reviewer (or an individual authorised by the auditor or reviewer).

60‑45 Auditor’s report on annual financial report

(1) An auditor’s report must contain a statement from the auditor as to whether, in the auditor’s opinion, the financial report has been prepared in accordance with this Division. If the auditor is not of that opinion, the auditor’s report must say why.

(2) If the auditor is of the opinion that the financial report has not been prepared in accordance with this Division, the auditor’s report must, to the extent it is practicable to do so, quantify the effect that non‑compliance has on the financial report. If it is not practicable to quantify the effect fully, the auditor’s report must say why.

(3) The auditor’s report must describe:

(a) any material defect or irregularity in the financial report; and

(b) any deficiency, failure or shortcoming in respect of the matters mentioned in paragraph 60‑30(3)(b), (c) or (d).

(4) The auditor’s report must include any statements or disclosures required by the auditing standards.

60‑50 Reviewer’s report on annual financial report

(1) A reviewer’s report must contain a statement from the reviewer as to whether the reviewer has concluded that, on the basis of the review, anything has come to the reviewer’s attention that causes the reviewer to believe that the financial report does not satisfy the requirements of this Division. If the auditor has concluded that anything has come to the reviewer’s attention that causes the reviewer to so believe, the reviewer’s report must say why.

(2) If the reviewer has concluded that anything has come to the reviewer’s attention that causes the reviewer to believe that the financial report does not satisfy the requirements of this Division, the reviewer’s report must, to the extent it is practicable to do so, quantify the effect that non‑compliance has on the financial report. If it is not practicable to quantify the effect fully, the reviewer’s report must say why.

(3) The reviewer’s report must describe:

(a) any material defect or irregularity in the financial report; and

(b) any deficiency, failure or shortcoming in respect of the matters mentioned in paragraph 60‑30(4)(b), (c) or (d).

(4) The reviewer’s report must include any statements or disclosures required by the auditing standards.

60‑55 Auditor or reviewer to be provided with information and assistance

In having its financial report audited or reviewed, a registered entity must ensure that the auditor or reviewer:

(a) has access at all reasonable times to the books of the registered entity; and

(b) is given all requested information, explanations or other assistance for the purposes of the audit or review.

A request under paragraph (b) must be a reasonable one.

60‑60 Basic religious charities

(1) This Subdivision does not apply to a basic religious charity, or to any report relating to a basic religious charity.

(2) However, this Subdivision applies to a basic religious charity in relation to a financial year, and to any report for the year relating to the charity, if the charity gives the Commissioner a financial report for the year.

Subdivision 60‑D—Errors in information statements and financial reports

60‑65 Errors in information statements and financial reports

(1) Subsection (2) applies if:

(a) a registered entity gives its information statement or financial report for a financial year to the Commissioner at a time; and

(b) after that time, the registered entity identifies a material error in the statement or report.

(2) The registered entity must give a corrected statement or report to the Commissioner:

(a) if the entity is a small registered entity—within 60 days after the entity identifies the error; or

(b) if the entity is a medium registered entity or a large registered entity—within 28 days after the entity identifies the error.

Note: Section 175‑35 provides for an administrative penalty for failing to give the Commissioner a statement required by this Act within the required time.

Subdivision 60‑E—Additional reporting requirements

60‑70 Object of this Subdivision

The object of this Subdivision is to ensure that the Commissioner can require further information to be provided in particular cases.

Example: If there is reason to believe that a registered entity has contravened this Act, further information could enable the Commissioner to carry out a recognised assessment activity in relation to the entity.

60‑75 Additional reporting requirements—particular registered entity

Additional report or additional reporting requirements

(1) The Commissioner may:

(a) determine, in writing, that:

(i) a particular registered entity must prepare a report in addition to any other statement or report the registered entity is required to prepare; and

(ii) the entity must give that report to the Commissioner by a time specified in the determination; or

(b) determine, in writing, that a particular registered entity must:

(i) include particular additional information in an information statement or financial report; or

(ii) meet particular additional requirements in relation to the manner in which an information statement or financial report is to be prepared.

(2) A determination under subsection (1) is not a legislative instrument.

Additional reports

(3) A determination under paragraph (1)(a) must specify:

(a) the information to be included in the report; and

(b) any other requirements to be met in relation to the manner in which the report is prepared.

(4) A determination under paragraph (1)(a) may require the report to be prepared:

(a) for a particular period or periods; or

(b) in relation to circumstances as they exist as at a particular date or dates.

This subsection does not limit subsection (3).

(5) The determination may require the report to be prepared for all periods of a particular kind that start or end on or after a date specified in the determination. This subsection does not limit subsection (3).

Determination

(6) A determination under subsection (1) may be made in respect of a past or future period but if it is in respect of a past period, the determination must be made no later than 6 years after the end of that period.

(7) The Commissioner must give the registered entity written notice of the making of the determination.

(8) A determination under subsection (1) must be for the purpose of enabling a recognised assessment activity to be carried out.

60‑80 Additional reporting requirements—classes of registered entities

Additional reports or additional reporting requirements

(1) The Commissioner may:

(a) make a determination in writing:

(i) requiring a particular class of registered entities to prepare a report in addition to any information statement or financial report the entities are required to prepare; and

(ii) requiring each entity in that class to give that report to the Commissioner by a time specified in the determination; or

(b) make a determination in writing requiring a particular class of registered entities to:

(i) include particular additional information in an information statement or financial report; or

(ii) meet particular additional requirements in relation to the manner in which an information statement or financial report is prepared.

(2) A determination under subsection (1) is a legislative instrument.

Additional reports

(3) A determination under paragraph (1)(a) must specify:

(a) the information to be included in the report; and

(b) any other requirements to be met in relation to the manner in which the report is prepared.

(4) A determination under paragraph (1)(a) may require the report to be prepared:

(a) for a particular period or periods; or

(b) in relation to circumstances as they exist as at a particular date or dates.

This subsection does not limit subsection (3).

Determinations

(6) A determination under subsection (1):

(a) may be expressed to be subject to conditions; and

(b) may be in respect of a past or future period but if it is in respect of a past period, the determination must be made no later than 6 years after the end of that period.

(7) A determination under subsection (1) must be for the purpose of enabling a recognised assessment activity to be carried out.

Subdivision 60‑F—Substituted accounting periods

60‑85 Commissioner may approve a different accounting period

(1) The Commissioner may allow a registered entity to adopt an accounting period which is a period of 12 months ending on a day other than 30 June (that is, a 12‑month period that does not align with the financial year), if the registered entity applies to the Commissioner in the approved form.

(2) If the registered entity adopts such an accounting period, this Division applies in relation to a financial year that starts after the entity adopts the new accounting period as if:

(a) each reference in this Division (not including this section) and sections 205‑25 and 205‑35 to the financial year were a reference to the accounting period that starts during the financial year; and

(b) the reference in subsections 60‑5(2) and 60‑10(2) to 31 December were a reference to the last day of the 6‑month period after the end of the accounting period.

(3) A registered entity seeking to adopt such an accounting period may apply, in the approved form, to the Commissioner for the Commissioner to make a decision under subsection (1).

60‑90 Commissioner may impose conditions

(1) The Commissioner may impose conditions on a decision under subsection 60‑85(1) to allow the registered entity to adopt such an accounting period.

(2) The conditions may be imposed at the time of making the decision or at any later time.

(3) The Commissioner may revoke the decision if satisfied that a condition has not been complied with.

Subdivision 60‑G—Collective and joint reporting

60‑95 Commissioner may approve collective or joint reporting by related entities

Joint reporting

(1) The Commissioner may allow 2 or more registered entities (reporting group) to prepare and lodge a single information statement, or a single information statement and a single financial report, in relation to the reporting group for a financial year.

Collective reporting

(2) The Commissioner may allow a reporting group to prepare and lodge one or more information statements, or one or more single information statements and one or more single financial reports, in relation to the reporting group for a financial year on a basis other than an entity‑by‑entity basis.

Example: The Commissioner may allow a reporting group of affiliated registered entities that advance religion and advance social or public welfare to prepare and lodge 2 financial reports, one report in relation to the reporting group’s religious functions and one in relation to the reporting group’s welfare functions.

Application in approved form

(3) Registered entities seeking to form a reporting group may apply, in the approved form, to the Commissioner for the Commissioner to make a decision under subsection (1) or (2).

Commissioner must consider certain issues

(4) In deciding whether to allow 2 or more registered entities to form a reporting group, the Commissioner must consider the following:

(a) how the public interest in the transparency and accountability of the registered entities is best served, including the possible effect on:

(i) the public’s understanding of the activities of the registered entities and the information provided in the information statement or financial report; and

(ii) the public’s ability to rely upon the information provided in the information statement or financial report;

(b) how the altered reporting arrangements would affect the Commissioner’s ability to assess a registered entity’s entitlement to registration or compliance with this Act;

(d) how the altered reporting arrangements would affect the Commissioner of Taxation’s ability to assess a registered entity’s compliance with a taxation law;

(e) the possible effect on the compliance and administrative costs of registered entities proposed to be included in the reporting group;

(f) the degree of affiliation, control and proximity of registered entities proposed to be included in the reporting group;

(g) the objects of this Act;

(h) any other matter that the Commissioner considers relevant.

60‑100 Commissioner may impose conditions

(1) The Commissioner may impose conditions on a decision under subsection 60‑95(1) or (2) to allow 2 or more registered entities to form a reporting group.

(2) The conditions may be imposed at the time of making the decision or at any later time.

(3) Without limiting subsection (1), the conditions may include one or more of the following:

(a) a condition that certain information in an information statement or financial report be separately identified;

(b) a condition that additional line items or notes be added to a financial report about the affairs of a particular registered entity (or part thereof);

(c) conditions relating to how the information statements and financial reports for the reporting group are to be structured for the purposes of subsection 60‑95(2).

Example: A reporting group that includes a deductible gift recipient may be made subject to a condition to include information about deductible donations received, and the spending of those donations, in its annual information statement and notes to its financial reports.

(4) The Commissioner may revoke the decision if satisfied that a condition has not been complied with.

60‑105 Treatment of reporting groups as small, medium or large registered entities

For the purposes of the application of this Division in relation to the reporting group:

(a) the reporting group is to be treated as a large registered entity if one or more of the registered entities that form the reporting group are large registered entities; or

(b) the reporting group is to be treated as a medium registered entity if:

(i) paragraph (a) does not apply; and

(ii) one or more of the registered entities that form the reporting group are medium registered entities; or

Part 3‑3—Duty to notify

Division 65—Duty to notify

65‑1 Simplified outline

The following is a simplified outline of this Division:

This Division requires registered entities to notify the Commissioner of certain matters, including significant contraventions or non‑compliance that result in the entity ceasing to be entitled to registration.

65‑5 Registered entities must notify Commissioner of certain matters

(1) A registered entity must notify the Commissioner in the approved form if any of the following circumstances exist:

(a) its name has changed;

(b) its address for service has changed;

(d) its governing rules have changed;

(e) the circumstances described in subsection (2).

Note: Section 175‑35 provides for an administrative penalty for failing to give the Commissioner a notice required by this Act within the required time.

(2) For the purposes of paragraph (1)(e), the circumstances exist if:

(a) the registered entity:

(i) has contravened a provision of this Act; or

(ii) has not complied with a governance standard or external conduct standard; and

(b) the contravention or non‑compliance is significant (see subsection (3)); and

(i) the registered entity is no longer entitled to be registered as a type of entity under Division 25;

(ii) the registered entity is no longer entitled to be registered as a subtype of entity under Division 25.

(3) For the purposes of paragraph (2)(b), in determining whether the contravention or non‑compliance is significant, take account of the following matters:

(a) the nature, significance and persistence of any contravention or non‑compliance;

(b) the desirability of ensuring that contributions (see section 205‑40) to the registered entity are applied consistently with the not‑for‑profit nature, and the purpose, of the registered entity.

(4) The notification must be given:

(a) as soon as practicable; and

(b) subject to paragraph (c)—no later than 28 days after the registered entity first becomes aware of the circumstances mentioned in subsection (1); and

(c) if the registered entity is a small registered entity and the notification relates only to circumstances mentioned in paragraph (1)(a), (b), (c) or (d)—no later than 60 days after the registered entity first becomes aware of those circumstances.

(5) To avoid doubt, 2 or more notifications may be included in the same document.

Chapter 4—Regulatory powers of the ACNC Commissioner

Part 4‑1—Information gathering and monitoring powers

Division 70—Information gathering powers

70‑1 Simplified outline

The following is a simplified outline of this Division:

The Commissioner can gather information necessary to monitor registered entities’ compliance with certain provisions and to assess registered entities’ ongoing entitlement to registration.

The Commissioner can gather information and documents necessary to determine whether information given in compliance with certain provisions is correct.

70‑5 Commissioner may obtain information and documents

(1) This section applies to an entity if the Commissioner reasonably believes that the entity has information or a document that it is reasonably necessary to obtain for the purpose of determining:

(a) whether a registered entity has complied, or is complying, with a provision subject to monitoring under Division 75 (see section 75‑5); or

(b) whether information subject to monitoring under Division 75 (see section 75‑10) is correct.

(2) The Commissioner may, by written notice given to the entity, require the entity:

(a) to give to the Commissioner, within the period and in the manner and form specified in the notice, any such information; or

(b) to attend and give evidence before the Commissioner, or an individual authorised by the Commissioner, for the purpose of obtaining such information; or

(d) to make copies of any such documents and to produce to the Commissioner, within the period and in the manner specified in the notice, those copies.

(3) For the purposes of paragraph (2)(b), the Commissioner may require the evidence mentioned in that paragraph:

(a) to be given on oath or affirmation; and

(b) to be given orally or in writing.

For that purpose, the Commissioner or an ACNC officer may administer an oath or affirmation.

(4) An entity commits an offence if:

(a) the entity is subject to a requirement under subsection (2); and

(b) the entity fails to comply with the requirement.

Penalty: 20 penalty units.

(5) A period specified under subsection (2) must not be shorter than 14 days after the notice is given.

(6) A notice under subsection (2) must set out the effect of the following provisions:

(a) subsection (4);

(b) sections 137.1 and 137.2 of the Criminal Code (which deal with false or misleading information or documents).

70‑10 Commissioner may inspect and copy original documents

The Commissioner may:

(a) inspect a document produced under paragraph 70‑5(2)(c); and

(b) make and retain copies of the whole or a part of such a document.

70‑15 Commissioner may retain original documents

(1) The Commissioner may take, and retain for as long as is necessary, possession of a document produced under paragraph 70‑5(2)(c).

(2) The entity otherwise entitled to possession of the document is entitled to be supplied, as soon as practicable, with a copy certified by the Commissioner to be a true copy.

(3) The certified copy must be received in all courts and tribunals as evidence as if it were the original.

(4) Until a certified copy is supplied, the Commissioner must, at such times and places as the Commissioner thinks appropriate, permit the entity otherwise entitled to possession of the document, or an individual authorised by that entity, to inspect and make copies of, or take extracts from, the document.

70‑20 Commissioner may inspect and retain copies of documents

The Commissioner may inspect, and retain possession of, a copy of a document produced under paragraph 70‑5(2)(d).

70‑25 Self‑incrimination

(1) An entity is not excused from giving information, or producing a document or a copy of a document, under this Division on the ground that the information or the production of the document or copy might tend to incriminate the entity or expose the entity to a penalty.

(2) However, in the case of an individual:

(a) the information given, or the document or copy produced; or

(b) giving the information or producing the document or copy; or

(c) any information, document or thing obtained as a direct or indirect consequence of giving the information or producing the document or copy;

is not admissible in evidence against the individual in criminal proceedings, or in proceedings for the recovery of a civil penalty, other than:

(d) proceedings for an offence against subsection 70‑5(4); or

(e) proceedings for an offence against section 137.1 or 137.2 of the Criminal Code (which deal with false or misleading information or documents) that relates to this Act; or

(f) proceedings for an offence against section 149.1 of the Criminal Code (which deals with obstruction of Commonwealth public officials) that relates to this Act.

Division 75—Monitoring

Subdivision 75‑A—Overview

75‑1 Simplified outline

The following is a simplified outline of this Division:

This Division allows an ACNC officer to monitor whether certain provisions have been, or are being, complied with.

It also allows an ACNC officer to monitor whether information given in compliance, or purported compliance, with certain provisions is correct.

An ACNC officer may enter premises for the purpose of monitoring.

Entry must be with the consent of the occupier of the premises or under a monitoring warrant.

An ACNC officer who enters premises may exercise monitoring powers. The ACNC officer may be assisted by other individuals if that assistance is necessary and reasonable.

An occupier’s consent to an ACNC officer entering premises for the purposes of monitoring must be voluntary. ACNC officers must abide by the terms of that consent.

An ACNC officer who enters premises under a monitoring warrant must give details of the warrant to the occupier of the premises.

The occupier of the premises may observe the execution of a monitoring warrant and must provide reasonable facilities and assistance for the effective execution of the warrant.

Subdivision 75‑B—Application of this Division

75‑5 Provisions subject to monitoring

The following provisions are subject to monitoring under this Division:

(a) a provision of this Act that creates an offence;

(b) a provision of a legislative instrument made under this Act that creates an offence;

(c) a provision of the Crimes Act 1914 or the Criminal Code that creates an offence, to the extent that the offence relates to this Act or a legislative instrument made under this Act;

(d) a provision of this Act, if non‑compliance with the provision gives rise to an administrative penalty;

(e) a provision of a legislative instrument made under this Act, if non‑compliance with the provision gives rise to an administrative penalty;

(f) a provision of this Act creating a condition, if:

(i) compliance with the condition is necessary for an entity to be entitled to registration as a type or subtype of entity; or

(ii) non‑compliance with the condition may lead to an entity having its registration as a type or subtype of entity revoked.

Note: These conditions are contained in sections 25‑5 (Entitlement to registration) and 35‑10 (Revoking registration).

75‑10 Information subject to monitoring

(1) Information given in compliance or purported compliance with one or more of the following provisions is subject to monitoring under this Division:

(a) a provision of this Act or of a legislative instrument made under this Act;

(b) a provision of the Crimes Act 1914 or of the Criminal Code, to the extent that the provision relates to this Act or a legislative instrument made under this Act.

(2) Information is also subject to monitoring under this Division if:

(a) an entity has given the Commissioner the information (whether it did so voluntarily or in fulfilling an obligation to do so); and

(b) the information is included on the Register in accordance with Division 40.

Subdivision 75‑C—Monitoring powers

75‑15 ACNC officer may enter premises by consent or under a warrant

(1) An ACNC officer may enter any premises and exercise the monitoring powers for either or both of the following purposes:

(a) determining whether a provision subject to monitoring under this Division has been, or is being, complied with;

(b) determining whether information subject to monitoring under this Division is correct.

Note: The monitoring powers are set out in sections 75‑20, 75‑25 and 75‑30.

(2) However, an ACNC officer is not authorised to enter the premises unless:

(a) the occupier of the premises has consented to the entry and the ACNC officer has shown his or her identity card if required by the occupier; or

(b) the entry is made under a monitoring warrant.

Note: If entry to the premises is with the occupier’s consent, the ACNC officer must leave the premises if the consent ceases to have effect (see section 75‑45).

75‑20 Monitoring powers of ACNC officers

The following are the monitoring powers that an ACNC officer may exercise in relation to premises under section 75‑15:

(a) the power to search the premises and any thing on the premises;

(b) the power to examine or observe any activity conducted on the premises;

(d) the power to make any still or moving image or any recording of the premises or any thing on the premises;

(e) the power to inspect any document on the premises;

(f) the power to take extracts from, or make copies of, any such document;

(g) the power to take onto the premises such equipment and materials as the ACNC officer requires for the purpose of exercising powers in relation to the premises;

(h) the power to sample any thing on the premises;

(i) the powers set out in subsections 75‑25(1) and (3) and 75‑30(2).

75‑25 Operating electronic equipment

(1) The monitoring powers include the power to:

(a) operate electronic equipment on the premises; and

(b) use a disk, tape or other storage device that:

(i) is on the premises; and

(ii) can be used with the equipment or is associated with it.

(2) The monitoring powers include the powers mentioned in subsection (3) if information (relevant data) is found in the exercise of the power under subsection (1) that is relevant to determining whether:

(a) a provision subject to monitoring under this Division has been, or is being, complied with; or

(b) information subject to monitoring under this Division is correct.

(3) The powers are as follows:

(a) the power to operate electronic equipment on the premises to put the relevant data in documentary form and remove the documents so produced from the premises;

(b) the power to operate electronic equipment on the premises to transfer the relevant data to a disk, tape or other storage device that:

(i) is brought to the premises for the exercise of the power; or

(ii) is on the premises and the use of which for that purpose has been agreed in writing by the occupier of the premises;

and remove the disk, tape or other storage device from the premises.

(4) An ACNC officer may operate electronic equipment as mentioned in subsection (1) or (3) only if:

(a) the ACNC officer believes on reasonable grounds that the operation of the equipment can be carried out without damage to the equipment; and

(b) the ACNC officer has reasonable grounds to suspect that:

(i) the equipment contains data relevant to determining whether a circumstance described in paragraph (2)(a) or (b) exists; or

(ii) the disk, tape or other storage device contains data relevant to determining whether a circumstance described in paragraph (2)(a) or (b) exists.

Note: For compensation for damage to electronic equipment, see section 75‑70.

75‑30 Securing evidence of the contravention of a provision subject to monitoring

(1) This section applies if an ACNC officer enters premises (whether under a monitoring warrant or by consent of the occupier) for either or both of the following purposes:

(a) determining whether a provision subject to monitoring has been, or is being, complied with;

(b) determining whether information subject to monitoring is correct.

(2) The monitoring powers include the power to secure a thing for a period not exceeding 24 hours if:

(a) the thing is found during the exercise of monitoring powers on the premises; and

(b) an ACNC officer believes on reasonable grounds that:

(i) a provision subject to monitoring has been contravened with respect to the thing; or

(ii) the thing affords evidence of the contravention of a provision subject to monitoring; or

(iii) the thing is intended to be used for the purpose of contravening a provision subject to monitoring; and

(i) it is necessary to secure the thing in order to prevent it from being concealed, lost or destroyed before a warrant to seize the thing is obtained; and

(ii) it is necessary to secure the thing without a warrant because the circumstances are serious and urgent.

(3) If an ACNC officer suspects on reasonable grounds that the thing needs to be secured for more than 24 hours, the ACNC officer may apply to an issuing officer for an extension of that period up to a specified time.

(4) The ACNC officer must give notice to the occupier of the premises, or an individual who apparently represents the occupier, of his or her intention to apply for an extension. The occupier or individual is entitled to be heard in relation to that application.

(5) The issuing officer may issue the extension if he or she is satisfied, by information on oath or affirmation, that it is necessary to do so in order to prevent the thing from being concealed, lost or destroyed before a warrant to seize the thing is obtained.

(6) The provisions of this Division relating to the issue of monitoring warrants apply, with such modifications as are necessary, to the issue of an extension.

(7) The period may be extended more than once.

75‑35 Individuals assisting ACNC officers

ACNC officers may be assisted by other individuals

(1) An ACNC officer may be assisted by other individuals in exercising powers or performing functions or duties under this Division, if that assistance is necessary and reasonable. An individual giving such assistance is an individual assisting the ACNC officer.

Powers, functions and duties of an individual assisting the ACNC officer

(2) An individual assisting the ACNC officer:

(a) may enter the premises; and

(b) may exercise powers and perform functions and duties under this Division for the purposes of assisting the ACNC officer to determine whether:

(i) a provision subject to monitoring under this Division has been, or is being, complied with; or

(ii) information subject to monitoring under this Division is correct; and

(3) A power exercised by an individual assisting the ACNC officer as mentioned in subsection (2) is taken for all purposes to have been exercised by the ACNC officer.

(4) A function or duty performed by an individual assisting the ACNC officer as mentioned in subsection (2) is taken for all purposes to have been performed by the ACNC officer.

(5) If a direction is given under paragraph (2)(c) in writing, the direction is not a legislative instrument.

75‑40 ACNC officer may ask questions and seek production of documents

Application of this section

(1) This section applies if an ACNC officer enters premises for the purposes of determining whether:

(a) a provision subject to monitoring under this Division has been, or is being, complied with; or

(b) information subject to monitoring under this Division is correct.

Entry with consent

(2) If the entry is authorised because the occupier of the premises consented to the entry, the ACNC officer may ask the occupier to answer any questions, and produce any document, relating to:

(a) the operation of the provision; or

(b) the information.

Entry under a monitoring warrant

(3) If the entry is authorised by a monitoring warrant, the ACNC officer may require any individual on the premises to answer any questions, and produce any document, relating to:

(a) the operation of the provision; or

(b) the information.

(4) An individual is not excused from answering a question, or producing a document or a copy of a document, under subsection (3) on the ground that the answer or the production of the document or copy might tend to incriminate the individual or expose the individual to a penalty.

(5) However:

(a) the answer given, or the document or copy produced; or

(b) giving the answer or producing the document or copy; or

(c) any information, document or thing obtained as a direct or indirect consequence of giving the answer or producing the document or copy;

is not admissible in evidence against the individual in criminal proceedings, or in proceedings for the recovery of a civil penalty, other than:

(d) proceedings for an offence against subsection (6); or

(e) proceedings for an offence against section 137.1 or 137.2 of the Criminal Code (which deal with false or misleading information or documents) that relates to this Act; or

(f) proceedings for an offence against section 149.1 of the Criminal Code (which deals with obstruction of Commonwealth public officials) that relates to this Act.

Offence

(6) An individual commits an offence if:

(a) the individual is subject to a requirement under subsection (3); and

(b) the individual fails to comply with the requirement.

Penalty for contravention of this subsection: 20 penalty units.

Subdivision 75‑D—Obligations and incidental powers of ACNC officers

75‑45 Consent

(1) Before obtaining the consent of an occupier of premises for the purposes of paragraph 75‑15(2)(a), an ACNC officer must inform the occupier that the occupier may refuse consent.

(2) A consent has no effect unless the consent is voluntary.

(3) A consent may be expressed to be limited to entry during a particular period. If so, the consent has effect for that period unless the consent is withdrawn before the end of that period.

(4) The occupier may extend the period of a consent that is limited as mentioned in subsection (3).

(5) A consent that is not limited as mentioned in subsection (3) has effect until the consent is withdrawn.

(6) If an ACNC officer entered premises because of the consent of the occupier of the premises, the ACNC officer, and any individual assisting the ACNC officer, must leave the premises if the consent ceases to have effect.

75‑50 Announcement before entry under warrant

(1) Before entering premises under a monitoring warrant, an ACNC officer must:

(a) announce that he or she is authorised to enter the premises; and

(b) show his or her identity card to the occupier of the premises, or to an individual who apparently represents the occupier, if the occupier or individual is present at the premises; and

(2) However, an ACNC officer is not required to comply with subsection (1) if the ACNC officer believes on reasonable grounds that immediate entry to the premises is required:

(a) to ensure the safety of an individual; or

(b) to ensure that the effective execution of the warrant is not frustrated.

(3) If:

(a) an ACNC officer does not comply with subsection (1) because of subsection (2); and

(b) the occupier of the premises, or an individual who apparently represents the occupier, is present at the premises;

the ACNC officer must show his or her identity card to the occupier or individual as soon as practicable after entering the premises.

75‑55 ACNC officer to be in possession of warrant

An ACNC officer executing a monitoring warrant must be in possession of the warrant or a copy of the warrant.

75‑60 Details of warrant etc. to be given to occupier

(1) An ACNC officer must comply with subsection (2) if:

(a) a monitoring warrant is being executed in relation to premises; and

(b) the occupier of the premises, or an individual who apparently represents the occupier, is present at the premises.

(2) The ACNC officer must, as soon as practicable:

(a) make a copy of the warrant available to the occupier or individual (which need not include the signature of the issuing officer who issued it); and

(b) inform the occupier or individual of the rights and responsibilities of the occupier or individual under Subdivision 75‑E, in English.

75‑65 Expert assistance to operate electronic equipment

(1) This section applies if an ACNC officer enters premises (whether under a monitoring warrant or by consent of the occupier).

Securing equipment

(2) The ACNC officer may secure any electronic equipment that is on the premises if the ACNC officer suspects on reasonable grounds that:

(a) there is relevant data on the premises; and

(b) the relevant data may be accessible by operating the equipment; and

(d) the relevant data may be destroyed, altered or otherwise interfered with, if the ACNC officer does not take action under this subsection.

The equipment may be secured by locking it up, placing a guard or any other means.

(3) Relevant data means information relevant to determining whether:

(a) a provision that is subject to monitoring under this Division has been, or is being, complied with; or

(b) information subject to monitoring under this Division is correct.

(4) The ACNC officer must give notice to the occupier of the premises, or an individual who apparently represents the occupier, of:

(a) the ACNC officer’s intention to secure the equipment; and

(b) the fact that the equipment may be secured for up to 24 hours.

Period equipment may be secured

(5) The equipment may be secured until the earlier of the following happens:

(a) the 24‑hour period ends;

(b) the equipment has been operated by the expert.

Note: For compensation for damage to electronic equipment, see section 75‑70.

Extensions

(6) The ACNC officer may apply to an issuing officer for an extension of the 24‑hour period up to a specified time if the ACNC officer suspects on reasonable grounds that the equipment needs to be secured for longer than that period.

(7) Before making the application, the ACNC officer must give notice to the occupier of the premises, or an individual who apparently represents the occupier, of his or her intention to apply for an extension. The occupier or individual is entitled to be heard in relation to that application.

(8) The issuing officer may issue the extension if he or she is satisfied, by information on oath or affirmation, that it is necessary to do so in order to prevent the destruction, alteration or interference with the relevant data.

(9) The provisions of this Division relating to the issue of monitoring warrants apply, with such modifications as are necessary, to the issue of an extension.

(10) The period may be extended more than once.

75‑70 Compensation for damage to electronic equipment

(1) This section applies if:

(a) as a result of electronic equipment being operated as mentioned in this Division:

(i) damage is caused to the equipment; or

(ii) the data recorded on the equipment is damaged; or

(iii) programs associated with the use of the equipment, or with the use of the data, are damaged or corrupted; and

(b) the damage or corruption occurs because:

(i) insufficient care was exercised in selecting the individual who was to operate the equipment; or

(ii) insufficient care was exercised by the individual operating the equipment.

(2) The Commonwealth must pay the owner of the equipment, or the user of the data or programs, such reasonable compensation for the damage or corruption as the Commonwealth and the owner or user agree on.

(3) However, if the owner or user and the Commonwealth fail to agree, the owner or user may institute proceedings in a designated court for such reasonable amount of compensation as the court determines.

(4) In determining the amount of compensation payable, regard is to be had to whether the occupier of the premises, or the occupier’s employees or agents, if they were available at the time, provided any appropriate warning or guidance on the operation of the equipment.

Subdivision 75‑E—Occupier’s rights and responsibilities

75‑75 Occupier entitled to observe execution of warrant

(1) The occupier of premises to which a monitoring warrant relates, or an individual who apparently represents the occupier, is entitled to observe the execution of the monitoring warrant if the occupier or individual is present at the premises while the warrant is being executed.

(2) The right to observe the execution of the warrant ceases if the occupier or individual impedes that execution.

(3) This section does not prevent the execution of the warrant in 2 or more areas of the premises at the same time.

75‑80 Occupier to provide ACNC officer with facilities and assistance

(1) The occupier of premises to which a monitoring warrant relates, or an individual who apparently represents the occupier, must provide:

(a) an ACNC officer executing the warrant; and

(b) any individual assisting the ACNC officer;

with all reasonable facilities and assistance for the effective exercise of their powers.

(2) An individual commits an offence if:

(a) the individual is subject to subsection (1); and

(b) the individual fails to comply with that subsection.

Penalty for contravention of this subsection: 20 penalty units.

Subdivision 75‑F—Monitoring warrants

75‑85 Monitoring warrants

Application for warrant

(1) The Commissioner may apply to an issuing officer for a warrant under this section in relation to premises.

Issue of warrant

(2) The issuing officer may issue the warrant if the issuing officer is satisfied, by information on oath or affirmation, that it is necessary that one or more ACNC officers should have access to the premises for the purpose of determining whether:

(a) a provision that is subject to monitoring under this Division has been, or is being, complied with; or

(b) information subject to monitoring under this Division is correct.

(3) However, the issuing officer must not issue the warrant unless the Commissioner or some other individual has given to the issuing officer, either orally or by affidavit, such further information (if any) as the issuing officer requires concerning the grounds on which the issue of the warrant is being sought.

Content of warrant

(4) The warrant must:

(a) describe the premises to which the warrant relates; and

(b) state that the warrant is issued under this section; and

(d) authorise one or more ACNC officers (whether or not named in the warrant) from time to time while the warrant remains in force:

(i) to enter the premises; and

(ii) to exercise the powers set out in this Division in relation to the premises; and

(e) state whether entry is authorised to be made at any time of the day or during specified hours of the day; and

(f) specify the day (not more than 1 month after the issue of the warrant) on which the warrant ceases to be in force.

Subdivision 75‑G—Powers of issuing officers

75‑90 Powers of issuing officers

Powers conferred personally

(1) A power conferred on an issuing officer by this Division is conferred on the issuing officer:

(a) in a personal capacity; and

(b) not as a court or a member of a court.

Powers need not be accepted

(2) The issuing officer need not accept the power conferred.

Protection and immunity

(3) An issuing officer exercising a power conferred by this Division has the same protection and immunity as if the issuing officer were exercising the power:

(a) as the court of which the issuing officer is a member; or

(b) as a member of the court of which the issuing officer is a member.

Subdivision 75‑H—General provisions

75‑95 Identity cards

(1) The Commissioner must issue an identity card to an ACNC officer who the Commissioner considers is likely to exercise powers and functions under this Division.

Form of identity card

(2) The identity card must:

(a) be in the form set out in writing by the Commissioner; and

(b) contain a recent photograph of the ACNC officer.

Offence

(3) An individual commits an offence if:

(a) the individual has been issued with an identity card; and

(b) the individual ceases to be an ACNC officer; and

(c) the individual does not return the identity card to the Commissioner within 14 days after ceasing to be an ACNC officer.

Penalty: 1 penalty unit.

(4) An offence against subsection (3) is an offence of strict liability.

Note: For strict liability, see section 6.1 of the Criminal Code.

Defence: card lost or destroyed

(5) Subsection (3) does not apply if the identity card was lost or destroyed.

Note: A defendant bears an evidential burden in relation to the matter in this subsection (see subsection 13.3(3) of the Criminal Code).

ACNC officer must carry card

(6) An ACNC officer must carry his or her identity card at all times when exercising powers under this Division as an ACNC officer.

Part 4‑2—Enforcement powers

Division 80—Warnings

80‑1 Simplified outline

The following is a simplified outline of this Division:

The Commissioner may give a registered entity a warning notice if:

(a) the entity is a federally regulated entity and the Commissioner reasonably believes that the entity has contravened a provision of this Act, or that it is more likely than not that the entity will contravene a provision of this Act; or

(b) the entity is a federally regulated entity and the Commissioner reasonably believes that the entity has not complied with a governance standard, or that it is more likely than not that the entity will not comply with a governance standard; or

(c) the Commissioner reasonably believes that the entity has not complied with an external conduct standard, or that it is more likely than not that the entity will not comply with an external conduct standard.

The notice may inform the registered entity of the circumstances in relation to the contravention or non‑compliance and outline actions that could be taken under this Act in response to the contravention or non‑compliance.

80‑5 Commissioner may issue formal warning

(1) Subsection (2) applies if:

(a) a registered entity is a federally regulated entity and the Commissioner reasonably believes that:

(i) the registered entity has contravened a provision of this Act; or

(ii) it is more likely than not that the registered entity will contravene a provision of this Act; or

(b) a registered entity is a federally regulated entity and the Commissioner reasonably believes that:

(i) the registered entity has not complied with a governance standard; or

(ii) it is more likely than not that the registered entity will not comply with a governance standard; or

(i) a registered entity has not complied with an external conduct standard; or

(ii) it is more likely than not that a registered entity will not comply with an external conduct standard.

(2) The Commissioner may, by written notice given to the registered entity:

(a) inform the registered entity of the circumstances in relation to the contravention, likely contravention, non‑compliance or likely non‑compliance; and

(b) warn the registered entity of the action that may be taken under this Act in response to the contravention, likely contravention, non‑compliance or likely non‑compliance.

Note: Information relating to warnings may be placed on the Register in accordance with Division 40.

(3) In deciding whether to give a warning, and deciding the content of the warning, the Commissioner must take account of the matters mentioned in subsection 35‑10(2).

Division 85—Directions

Subdivision 85‑A—Overview

85‑1 Simplified outline

The following is a simplified outline of this Division:

The Commissioner’s guidance and education (see section 110‑10) will assist registered entities to comply with and understand their obligations under this Act. However, where enforcement action is required, the Commissioner’s range of enforcement powers includes the power to issue directions, so that the Commissioner can provide a proportionate and effective regulatory response.

The Commissioner may give a registered entity a written direction if:

The Commissioner may only issue directions that the Commissioner considers are necessary to address the contravention or non‑compliance, and may only do so after considering a range of policy matters.

A decision of the Commissioner to issue a direction is reviewable in accordance with Part 7‑2.

A registered entity that does not comply with a direction commits an offence.

Subdivision 85‑B—Commissioner’s power to give directions

85‑5 Commissioner may give directions in certain circumstances

(1) The Commissioner may give a registered entity a written direction of a kind specified in subsection 85‑10(1) only if:

(a) the registered entity is a federally regulated entity and the Commissioner reasonably believes that:

(i) the registered entity has contravened a provision of this Act; or

(ii) it is more likely than not that the registered entity will contravene a provision of this Act; or

(b) the registered entity is a federally regulated entity and the Commissioner reasonably believes that:

(i) the registered entity has not complied with a governance standard; or

(ii) it is more likely than not that the registered entity will not comply with a governance standard; or

(i) the registered entity has not complied with an external conduct standard; or

(ii) it is more likely than not that the registered entity will not comply with an external conduct standard.

(2) In deciding whether to give a direction, and deciding the content of the direction, the Commissioner must take account of the matters mentioned in subsection 35‑10(2).

(3) The direction must:

(a) specify the ground or grounds mentioned in subsection (1) on the basis of which the direction is given; and

(b) specify the time by which, or the period during which, the registered entity must comply with the direction.

85‑10 Kinds of direction

(1) The kinds of direction that the registered entity may be given are directions to:

(a) do a specified act that:

(i) if paragraph 85‑5(1)(a) applies—the Commissioner considers is necessary to address the contravention mentioned in that paragraph (or prevent the likely contravention mentioned in that paragraph); or

(ii) if paragraph 85‑5(1)(b) or (c) applies—the Commissioner considers is necessary to address the non‑compliance mentioned in that paragraph (or prevent the likely non‑compliance mentioned in that paragraph); or

(b) not do a specified act that:

(i) if paragraph 85‑5(1)(a) applies—the Commissioner considers is necessary to refrain from doing to address the contravention mentioned in that paragraph (or prevent the likely contravention mentioned in that paragraph); or

(ii) if paragraph 85‑5(1)(b) or (c) applies—the Commissioner considers is necessary to refrain from doing to address the non‑compliance mentioned in that paragraph (or prevent the likely non‑compliance mentioned in that paragraph).

Note: Information relating to directions, variations of directions and revocations of directions may be placed on the Register in accordance with Division 40.

(2) Without limiting the generality of paragraphs (1)(a) and (b), the direction may be:

(a) to ensure that an individual covered by subsection (3) does not make, or participate in making, decisions that affect the whole, or a substantial part, of the business of the registered entity; or

(b) to not enter into a specified commercial transaction, financial transaction or other transaction, including the following:

(i) borrowing any amount;

(ii) repaying any money on deposit or advance;

(iii) paying or transferring any amount or asset to any entity, or creating an obligation (contingent or otherwise) to do so.

(3) This subsection covers an individual (other than a responsible entity of the registered entity):

(a) who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business of the registered entity; or

(b) who has the capacity to affect significantly the registered entity’s financial standing; or

(c) in accordance with whose instructions or wishes the responsible entities of the registered entity are accustomed to act (excluding advice given by the individual in the proper performance of functions attaching to the individual’s professional capacity or his or her business relationship with the responsible entities of the registered entity).

(4) Without limiting the generality of subsection (1), the direction may:

(a) specify a particular class of acts or particular classes of acts; or

(b) make different provision with respect to different acts or different classes of acts.

(5) A direction does not apply to the payment or transfer of money pursuant to an order of a court or a process of execution.

85‑15 Power to comply with directions

The registered entity has power to comply with the direction despite anything in its governing rules or any contract or arrangement to which it is a party.

85‑20 Variation and revocation of directions

(1) The Commissioner may, by notice in writing to the registered entity, vary the direction if, at the time of the variation, the Commissioner considers that the variation is necessary and appropriate.

(2) In deciding whether to vary a direction, and deciding the content of the variation, the Commissioner must take account of the matters mentioned in subsection 35‑10(2).

(3) The direction has effect until the Commissioner revokes it by notice in writing to the registered entity. The Commissioner may revoke the direction if, at the time of revocation, the Commissioner considers that the direction is no longer necessary or appropriate.

(4) In deciding whether to revoke a direction, the Commissioner must take account of the matters mentioned in subsection 35‑10(2).

(5) Subsection (6) applies if:

(a) either:

(i) the Commissioner gives a direction to the registered entity at a time; or

(ii) the Commissioner varies a direction at a time; and

(b) the Commissioner does not vary or revoke the direction for 12 months after that time.

(6) The Commissioner must consider within a reasonable time after the end of that 12 months whether it would be reasonable to vary or revoke the direction.

85‑25 Objections

A registered entity that is dissatisfied with any of the following decisions may object against it in the manner set out in Part 7‑2:

(a) a decision to give a direction;

(b) a decision to vary a direction;

(c) a decision not to vary or revoke a direction after considering whether to vary or revoke it in accordance with subsection 85‑20(6).

Subdivision 85‑C—Non‑compliance with a direction

85‑30 Non‑compliance with a direction

(1) A registered entity commits an offence if:

(a) it does, or fails to do, an act; and

(b) doing, or failing to do, the act results in a contravention of a direction given to it under Subdivision 85‑B.

Penalty: 40 penalty units.

Note: If a body corporate is convicted of an offence against this subsection, subsection 4B(3) of the Crimes Act 1914 allows a court to impose a fine of up to 5 times the penalty stated above.

(2) If a registered entity does or fails to do an act in circumstances that give rise to the registered entity committing an offence against subsection (1), the registered entity commits an offence against that subsection in respect of:

(a) the first day on which the offence is committed; and

(b) each subsequent day (if any) on which the circumstances that gave rise to the registered entity committing the offence continue (including the day of conviction for any such offence or any later day).

Note: This subsection is not intended to imply that section 4K of the Crimes Act 1914 does not apply to offences against this Act or the regulations.

Division 90—Enforceable undertakings

90‑1 Simplified outline

The following is a simplified outline of this Division:

The Commissioner’s guidance and education (see section 110‑10) will assist registered entities to comply with and understand their obligations under this Act. However, where enforcement action is required, the Commissioner’s range of enforcement powers includes the power to accept enforceable undertakings, so that the Commissioner can provide a proportionate and effective regulatory response.

This Division provides the Commissioner with the authority to accept an undertaking relating to provisions in this Act or in legislative instruments made under this Act from a registered entity that is a federally regulated entity. The Commissioner will also have the authority to accept an undertaking relating to external conduct standards from any registered entity.

Undertakings may be enforced in a designated court. The orders that may be made by a court include an order directing compliance with an undertaking, an order requiring any financial benefit from a failure to comply with an undertaking to be surrendered, an order for damages, and any other orders that the court considers appropriate.

90‑5 Enforceable provisions

The following provisions are enforceable under this Division:

(a) a provision of this Act;

(b) a governance standard or external conduct standard;

90‑10 Acceptance of undertakings

(1) The Commissioner may accept any of the following undertakings:

(a) a written undertaking given by a registered entity that is a federally regulated entity that the entity will, in order to comply with a provision enforceable under this Division, take specified action;

(b) a written undertaking given by a registered entity that is a federally regulated entity that the entity will, in order to comply with a provision enforceable under this Division, refrain from taking specified action;

(c) a written undertaking given by a registered entity that is a federally regulated entity that the entity will take specified action directed towards ensuring that:

(i) the entity does not contravene a provision enforceable under this Division in the future; or

(ii) it is more likely than not that the entity will not contravene such a provision in the future.

(2) The Commissioner may accept any of the following undertakings:

(a) a written undertaking given by a registered entity that the entity will, in order to comply with an external conduct standard, take specified action;

(b) a written undertaking given by a registered entity that the entity will, in order to comply with an external conduct standard, refrain from taking specified action;

(c) a written undertaking given by a registered entity that the entity will take specified action directed towards ensuring that:

(i) the entity does not fail to comply with an external conduct standard in the future; or

(ii) the entity is more likely than not to comply with such a standard in the future.

(3) The undertaking must be expressed to be an undertaking under this section.

Note: Information relating to undertakings may be placed on the Register in accordance with Division 40.

(4) The entity may withdraw or vary the undertaking at any time, but only with the written consent of the Commissioner.

(5) The written consent of the Commissioner is not a legislative instrument.

(6) The Commissioner may, by written notice given to the entity, cancel the undertaking.

90‑15 Enforcement of undertakings

(1) If:

(a) the Commissioner has been given an undertaking under section 90‑10; and

(b) the undertaking has not been withdrawn or cancelled; and

the Commissioner may apply to a designated court for an order under subsection (2).

(2) The court may make any or all of the orders mentioned in subsection (3) if it is satisfied that:

(a) the entity has breached the undertaking; and

(b) the entity is still a registered entity; and

(c) if the Commissioner was given the undertaking under subsection 90‑10(1) (undertakings by federally regulated entities)—the entity is still a federally regulated entity.

(3) The orders are as follows:

(a) an order directing the entity to comply with the undertaking;

(b) an order directing the entity to pay to the Commonwealth an amount up to the amount of any financial benefit that the entity has obtained directly or indirectly and that is reasonably attributable to the breach;

(c) any order that the court considers appropriate directing the entity to compensate any other entity that has suffered loss or damage as a result of the breach;

(d) any other order that the court considers appropriate.

Division 95—Injunctions

95‑1 Simplified outline

The following is a simplified outline of this Division:

The Commissioner’s guidance and education (see section 110‑10) will assist registered entities to comply with and understand their obligations under this Act. However, where enforcement action is required, the Commissioner’s range of enforcement powers includes the power to apply for injunctions, so that the Commissioner can provide a proportionate and effective regulatory response.

A designated court may grant an injunction (including a consent injunction or interim injunction) in the enforcement of provisions enforceable under this Division if:

(a) the injunction or interim injunction relates to a registered entity that is a federally regulated entity; or

(b) the injunction or interim injunction relates to a registered entity and is in respect of an external conduct standard.

Injunctions may restrain registered entities from contravening a provision enforceable under this Division, or compel the doing of a thing.

95‑5 Enforceable provisions

The following provisions are enforceable under this Division:

(a) a provision of this Act;

(b) a governance standard or external conduct standard;

95‑10 Injunctions relating to federally regulated entity etc.

A designated court may grant an injunction or an interim injunction under this Division only if:

(a) the injunction or interim injunction relates to a registered entity that is a federally regulated entity; or

(b) the injunction or interim injunction relates to a registered entity and is in respect of an external conduct standard.

95‑15 Grant of injunctions

Restraining injunctions

(1) If a person has engaged, is engaging or is proposing to engage, in conduct in contravention of a provision enforceable under this Division, a designated court may, on application by the Commissioner, grant an injunction:

(a) restraining the person from engaging in the conduct; and

(b) if, in the court’s opinion, it is desirable to do so—requiring the person to do a thing.

Performance injunctions

(2) If:

(a) a person has refused or failed, or is refusing or failing, or is proposing to refuse or fail, to do a thing; and

(b) the refusal or failure was, is or would be a contravention of a provision enforceable under this Division;

the designated court may, on application by the Commissioner, grant an injunction requiring the person to do that thing.

Consent injunctions

(3) A designated court may grant an injunction by consent of all the parties to proceedings under this section, whether or not the court is satisfied that the person has contravened, or will contravene, a provision enforceable under this Division.

Note: Information relating to injunctions may be placed on the Register in accordance with Division 40.

95‑20 Interim injunctions

Grant of interim injunctions

(1) Before deciding an application for an injunction under section 95‑15, a designated court may grant an interim injunction:

(a) restraining a person from engaging in conduct; or

(b) requiring a person to do a thing.

No undertakings as to damages

(2) The designated court must not require the Commissioner to give an undertaking as to damages as a condition of granting an interim injunction.

95‑25 Discharging or varying injunctions

A designated court may discharge or vary an injunction granted by that court under this Division.

95‑30 Certain limits on granting injunctions not to apply

Restraining injunctions

(1) The power of a court under this Division to grant an injunction restraining a person from engaging in conduct may be exercised:

(a) whether or not it appears to the court that the person intends to engage again, or to continue to engage, in conduct of that kind; and

(b) whether or not the person has previously engaged in conduct of that kind; and

(c) whether or not there is an imminent danger of substantial damage to any other entity if the person engages in conduct of that kind.

Performance injunctions

(2) The power of a court under this Division to grant an injunction requiring a person to do a thing may be exercised:

(a) whether or not it appears to the court that the person intends to refuse or fail again, or to continue to refuse or fail, to do that thing; and

(b) whether or not the person has previously refused or failed to do that thing; and

(c) whether or not there is an imminent danger of substantial damage to any other entity if the person refuses or fails to do that thing.

95‑35 Court to take account of objects of this Act

In exercising the powers conferred on a court under this Division, the court must take into account the objects of this Act.

95‑40 Other powers of a court unaffected

The powers conferred on a court under this Division are in addition to, and not instead of, any other powers of the court, whether conferred by this Act or otherwise.

Division 100—Suspension and removal of responsible entities

Subdivision 100‑A—Overview

100‑1 Simplified outline

The following is a simplified outline of this Division:

The Commissioner’s guidance and education (see section 110‑10) will assist registered entities to comply with and understand their obligations under this Act. However, where enforcement action is required, the Commissioner’s range of enforcement powers includes the power to suspend or remove a responsible entity of a registered entity, so that the Commissioner can provide a proportionate and effective regulatory response.

The Commissioner may suspend or remove a responsible entity of a registered entity if:

(a) the registered entity is a federally regulated entity and the Commissioner reasonably believes that the registered entity has contravened a provision of this Act, or that it is more likely than not that the registered entity will contravene a provision of this Act; or

(b) the registered entity is a federally regulated entity and the Commissioner reasonably believes that the registered entity has not complied with a governance standard, or that it is more likely than not that the registered entity will not comply with a governance standard; or

(c) the Commissioner reasonably believes that the registered entity has not complied with an external conduct standard, or that it is more likely than not that the registered entity will not comply with an external conduct standard.

The Commissioner may only do so if the suspension or removal is necessary to address the contravention or non‑compliance, and may only do so after considering a range of policy matters.

A decision of the Commissioner to suspend or remove a responsible entity is reviewable in accordance with Part 7‑2.

The Commissioner may appoint acting responsible entities to replace suspended or removed responsible entities, so that the registered entity may continue to function.

Subdivision 100‑D deals with the property of a registered entity that is a trust, if a trustee of the trust is suspended or removed.

Subdivision 100‑B—Suspension and removal of responsible entities

100‑5 Commissioner’s exercise of power under this Subdivision

(1) The Commissioner can exercise a power under this Subdivision in relation to a registered entity only if: