House of Representatives

Corporations and Financial Sector Legislation Amendment Bill 2013

Explanatory Memorandum

(Circulated by the authority of the Parliamentary Secretary to the Treasurer, the Hon Bernie Ripoll MP)

General outline and financial impact

Outline

The Corporations and Financial Sector Legislation Amendment Bill 2013 (the Bill) amends the Corporations Act 2001 (the Corporations Act), the Payment Systems and Netting Act 1998 (the PSN Act), the Mutual Assistance in Business Regulation Act 1992 (the MABR Act), the Australian Securities and Investments Commission Act 2001 (the ASIC Act), the Reserve Bank Act 1959 (the RB Act), the Clean Energy Regulator Act 2011 (the CER Act) and the Carbon Credits (Carbon Farming Initiative) Act 2011 (the CFI Act) to introduce a range of miscellaneous measures related to the regulation of over-the-counter derivatives (OTC derivatives) and other financial products. The key measures are intended to:

·
assist central counterparties (CCPs) in managing defaults of clearing participants;
·
improve the allocation of resources by the Australian Securities and Investments Commission (ASIC) and the Reserve Bank of Australia (RBA) in assessing the compliance of Australian market licence (AML) and clearing and settlement facility licence (CFSL) holders with their legal obligations;
·
allow certain Australian regulators including the RBA to exchange protected information with other entities in Australia and overseas in the execution of their duties subject to appropriate safeguards; and
·
allow ASIC to gather and share protected information with regulatory entities overseas for supervision and enforcement purposes; and require ASIC to report on the use of those powers.

Date of effect: All amendments take effect 28 days after Royal Assent.

Financial impact: Nil.

Human rights implications: This Bill does not raise any human rights issue. See Chapter 2 - Statement of Compatibility with Human Rights , paragraphs 2.1 to 2.6.

Compliance cost impact: The compliance costs related to the amendments in the Bill are expected to be low.

Summary of regulation impact statement

Regulation impact on business

Impact: The Office of Best Practice Regulation (OBPR) has confirmed that none of the amendments in the Bill require a regulation impact statement (RIS) as they have a minor impact on businesses. The following OBPR approvals have been obtained: portability amendments (OBPR ID 14373); the amendments relating to ASIC's annual compliance assessments (OBPR ID 13928); exchange of information between ASIC and pan-European regulators (OBPR ID 14661); and the measures facilitating the exchange of information by the RBA, the Clean Energy Regulator and the Carbon Credits Administrator (OBPR ID 14450).


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