Australian Securities and Investments Commission Amendment Regulations 2001 (No. 1)1

Statutory Rules 2001 No. 3172

I, PETER JOHN HOLLINGWORTH, Governor-General of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, make the following Regulations under the Australian Securities and Investments Commission Act 2001.

Dated 8 October 2001

PETER HOLLINGWORTH

Governor-General

By His Excellency’s Command

JOE HOCKEY

Minister for Financial Services and Regulation

1 Name of Regulations

  These Regulations are the Australian Securities and Investments Commission Amendment Regulations 2001 (No. 1).

2 Commencement

  These Regulations commence on the day on which item 1 of Schedule 1 to the Financial Services Reform Act 2001 commences.

3 Amendment of Australian Securities and Investments Commission Regulations 2001

  Schedule 1 amends the Australian Securities and Investments Commission Regulations 2001.

Schedule 1 Amendments

(regulation 3)

[1] After regulation 2

insert

2A Territorial application of Act

 (1) For subsection 4 (2) of the Act, the Act applies in each external Territory in accordance with this regulation.

 (2) For the Territory of Christmas Island and the Territory of Cocos (Keeling) Islands:

 (a) Division 2 of Part 2 of the Act applies in relation to:

 (i) a financial product; and

 (ii) a financial service; and

 (b) the remainder of the Act applies in relation to:

 (i) a superannuation product within the meaning of section 761A of the Corporations Act; and

 (ii) an RSA product within the meaning of section 761A of the Corporations Act; and

 (iii) a financial service that relates to a superannuation product within the meaning of section 761A of the Corporations Act; and

 (iv) a financial service that relates to an RSA product within the meaning of section 761A of the Corporations Act.

 (3) For an external Territory other than the Territory of Christmas Island and the Territory of Cocos (Keeling) Islands, the Act applies in relation to:

 (a) a superannuation product within the meaning of section 761A of the Corporations Act; and

 (b) an RSA product within the meaning of section 761A of the Corporations Act; and

 (c) a financial service that relates to a superannuation product within the meaning of section 761A of the Corporations Act; and

 (d) a financial service that relates to an RSA product within the meaning of section 761A of the Corporations Act.

2B Financial products: credit facility

 (1) For paragraph 12BAA (7) (k) of the Act, each of the following is a credit facility:

 (a) the provision of credit:

 (i) for any period; and

 (ii) with or without prior agreement between the credit provider and the debtor; and

 (iii) whether or not both credit and debit facilities are available;

 (b) a facility:

 (i) known as a bill facility; and

 (ii) under which a credit provider provides credit by accepting, drawing, discounting or indorsing a bill of exchange or promissory note;

 (c) the provision of credit by a pawnbroker in the ordinary course of a pawnbroker’s business (being a business which is being lawfully conducted by the pawnbroker);

 (d) the provision of credit by the trustee of the estate of a deceased person by way of an advance to a beneficiary or prospective beneficiary of the estate;

 (e) the provision of credit by an employer, or a related body corporate of an employer, to an employee or former employee (whether or not it is provided to the employee or former employee with another person);

 (f) the provision of a mortgage that secures obligations under a credit contract (other than a lien or charge arising by operation of any law or by custom);

 (g) a guarantee related to a mortgage mentioned in paragraph (f);

 (h) a guarantee of obligations under a credit contract;

 (i) a facility for making non-cash payments (within the meaning of section 763D of the Corporations Act) if payments made using the facility will all be debited to a facility mentioned in paragraphs (a) to (h).

 (2) The provision of consumer credit insurance that includes a contract of general insurance for the Insurance Contracts Act 1984 is not a credit facility.

 (3) In this regulation:

credit means a contract, arrangement or understanding:

 (a) under which:

 (i) payment of a debt owed by one person (a debtor) to another person (a credit provider) is deferred; or

 (ii) one person (a debtor) incurs a deferred debt to another person (a credit provider); and

 (b) including any of the following:

 (i) any form of financial accommodation;

 (ii) a hire purchase agreement;

 (iii) credit provided for the purchase of goods or services;

 (iv) a contract, arrangement or understanding for the hire, lease or rental of goods or services, other than a contract, arrangement or understanding under which:

 (A) full payment is made before or when the goods or services are provided; and

 (B) for the hire, lease or rental of goods — an amount at least equal to the value of the goods is paid as a deposit in relation to the return of the goods;

 (v) an article known as a credit card or charge card;

 (vi) an article, other than a credit card or a charge card, intended to be used to obtain cash, goods or services;

 (vii) an article, other than a credit card or a charge card, commonly issued to customers or prospective customers by persons who carry on business for the purpose of obtaining goods or services from those persons by way of a loan;

 (viii) a liability in respect of redeemable preference shares;

 (ix) a financial benefit arising from or as a result of a loan;

 (x) assistance in obtaining a financial benefit arising from or as a result of a loan;

 (xi) issuing, indorsing or otherwise dealing in a promissory note;

 (xii) drawing, accepting, indorsing or otherwise dealing in a negotiable instrument (including a bill of exchange);

 (xiii) granting or taking a lease over real or personal property;

 (xiv) a letter of credit.

[2] Paragraph 3 (j)

substitute

 (j) the Department of Consumer and Employment Protection of Western Australia;

[3] Regulation 5

omit

or 32 (1)

[4] Regulation 15, definition of application

omit

the Act.

insert

the Corporations Act 2001.

[5] After Part 4

insert

Part 5 Clearing and settlement facilities

45 Meaning of clearing and settlement facility

  For paragraph 12BAB (17) (b) of the Act, the following obligations are prescribed:

 (a) each obligation arising from a contract to transfer a financial product mentioned in paragraph 764A (1) (a) of the Corporations Act;

 (b) each obligation arising from a contract to transfer a financial product mentioned in paragraph 764A (1) (b) of the Corporations Act;

 (c) each obligation arising from acquiring or providing a financial product mentioned in paragraph 764A (1) (c) of the Corporations Act;

 (d) each obligation arising from a contract to transfer a financial product mentioned in paragraph 764A (1) (j) of the Corporations Act;

 (e) each obligation arising from a contract to transfer a financial product mentioned in paragraph 764A (1) (ba) of the Corporations Act.

46 Conduct that does not constitute operating a clearing and settlement facility

 (1) For paragraph 12BAB (18) (i) of the Act, the conduct of TNS Clearing Pty Limited in becoming the legal counterparty to a broker-to-broker trade in quoted securities that is executed on the financial market known as the Australian Stock Exchange in the course of novation does not constitute operating a clearing and settlement facility.

 (2) For paragraph 12BAB (18) (i) of the Act, the conduct of:

 (a) the Stock Exchange of Newcastle Limited, or an agent of that body; or

 (b) a participant of the Stock Exchange of Newcastle Limited, or an agent of the participant; or

 (c) Bendigo Stock Exchange Limited, or an agent of that body; or

 (d) a participant of the Bendigo Stock Exchange Limited, or an agent of the participant;

in operating a facility in accordance with the operating rules of a licensed market does not constitute operating a clearing and settlement facility if the requirements of subregulation (3) are met.

 (3) For subregulation (2), the requirements are:

 (a) the market licensee must have, and must be responsible for enforcing, operating rules that apply to a participant of the licensed market in relation to the participant’s obligations arising from transactions carried out on the licensed market; and

 (b) a participant mentioned in paragraph (a), or an agent of the participant, must be responsible for fulfilling the obligations owed to another participant or agent arising from transactions carried out on the licensed market; and

 (c) the market licensee is not the operator of any other clearing and settlement facility; and

 (d) each participant of the licensed market is not the operator of any other clearing and settlement facility; and

 (e) each agent of a participant of the licensed market is not the operator of any other clearing and settlement facility.

 (4) In this regulation:

novation means the replacement of a contract (the original contract) between the buyer and seller of financial products with:

 (a) a contract between the buyer and TNS Clearing Pty Limited in the same terms as the original contract; and

 (b) a second contract between the seller and TNS Clearing Pty Limited in the same terms as the original contract.

47 Financial transaction reports

  For paragraph 243D (j) of the Act, neither subsection 16 (5A) nor (5AA) of the Financial Transaction Reports Act 1988 prohibits a cash dealer from communicating or disclosing a fact or information referred to in either of those subsections:

 (a) to a body corporate approved under section 770 of the Corporations Act as an approved securities organisation; or

 (b) in accordance with conditions imposed by the Minister when approving under section 770A of the Corporations Act a stock market for electronic trading of interests in a registered scheme; or

 (c) in accordance with conditions imposed by the Minister when declaring a specified stock market to be an exempt stock market under section 771 of the Corporations Act; or

 (d) in accordance with conditions imposed by the Minister when declaring a specified futures market to be an exempt futures market under section 1127 of the Corporations Act.

Note   Although sections 770, 770A, 771 and 1127 of the Corporations Act were repealed by the Financial Services Reform Act 2001, the sections are still relevant for specific purposes in the period of 2 years after the commencement of the Financial Services Reform Act.

[6] Schedule 1, Form 2

omit

/subsection 32 (1)3

[7] Schedule 1, Form 3

omit

/Corporations and Securities Panel3

insert

/Takeovers Panel3

[8] Schedule 3

before

ASX Futures Exchange Pty Ltd

insert

Part 1 Australian bodies corporate

[9] Schedule 3

after

Australian Stock Exchange Limited

insert

Bendigo Stock Exchange Ltd

[10] Schedule 3

after

Options Clearing House Pty Limited

insert

SFE Corporation Limited

Stock Exchange of Newcastle Limited

[11] Schedule 3

omit

Sydney Futures Exchange Limited

[12] Schedule 3

insert

Part 2 Foreign bodies corporate

1. These Regulations amend Statutory Rules 2001 No. 192.

2. Notified in the Commonwealth of Australia Gazette on 15 October 2001.