Safeguard Mechanism (Crediting) Amendment Act 2023 (14 of 2023)

Schedule 2   Australian National Registry of Emissions Units

Australian National Registry of Emissions Units Act 2011

25   After Part 3

Insert:

Part 4 - Safeguard mechanism credit units

48 Simplified outline of this Part

• This Part sets out rules about the ownership, transfer and transmission of safeguard mechanism credit units.

48A A safeguard mechanism credit unit is personal property

A safeguard mechanism credit unit is personal property and, subject to sections 48D and 48E, is transmissible by assignment, by will and by devolution by operation of law.

48B Ownership of safeguard mechanism credit units

(1) The registered holder of a safeguard mechanism credit unit:

(a) is the legal owner of the unit; and

(b) may, subject to this Act and the National Greenhouse and Energy Reporting Act 2007, deal with the unit as its legal owner and give good discharges for any consideration for any such dealing.

(2) Subsection (1) only protects a person who deals with the registered holder of the unit as a purchaser:

(a) in good faith for value; and

(b) without notice of any defect in the title of the registered holder.

48C Transfer of safeguard mechanism credit units

For the purposes of this Act, if there is an entry for a safeguard mechanism credit unit in a Registry account (the first Registry account ) kept by a person (the first person ):

(a) a transfer of the unit from the first Registry account to a Registry account kept by another person consists of:

(i) the removal of the entry for the unit from the first Registry account; and

(ii) the making of an entry for the unit in the Registry account kept by the other person; and

(b) a transfer of the unit from the first Registry account to another Registry account kept by the first person consists of:

(i) the removal of the entry for the unit from the first Registry account; and

(ii) the making of an entry for the unit in the other Registry account kept by the first person.

48D Transmission of safeguard mechanism credit units by assignment

(1) A transmission by assignment of a safeguard mechanism credit unit for which there is an entry in a Registry account is of no force until:

(a) the transferor, by electronic notice transmitted to the Regulator, instructs the Regulator to transfer the unit from the relevant Registry account kept by the transferor to a Registry account kept by the transferee; and

(b) the Regulator complies with that instruction.

(2) An instruction under paragraph (1)(a) must set out:

(a) the account number of the transferor's Registry account; and

(b) the account number of the transferee's Registry account.

(3) If the Regulator receives an instruction under paragraph (1)(a), the Regulator must comply with the instruction as soon as practicable after receiving it.

(4) The Registry must set out a record of each instruction under paragraph (1)(a).

(5) If the transferor is the Commonwealth, the Minister may give an instruction under paragraph (1)(a) on behalf of the transferor.

48E Transmission of safeguard mechanism credit units by operation of law etc.

Scope

(1) This section applies if a safeguard mechanism credit unit for which there is an entry in a Registry account is transmitted from a person (the transferor ) to another person (the transferee ) by any lawful means other than by a transfer under section 48D.

Effect of transmission

(2) The transmission is of no force until the Regulator transfers the safeguard mechanism credit unit under subsection (8) or (9).

Declaration of transmission

(3) The transferee must, within 90 days after the transmission, give the Regulator:

(a) a declaration of transmission; and

(b) such evidence of transmission as is specified in the legislative rules.

(4) A declaration of transmission must be made in accordance with the legislative rules.

(5) If the transferee does not already have a Registry account, the declaration of transmission must be accompanied by a request, under regulations made for the purposes of subsection 10(1), for the Regulator to open a Registry account in the name of the transferee.

(6) If the Regulator is satisfied that special circumstances warrant the extension of the 90-day period mentioned in subsection (3), the Regulator may extend that period.

(7) The Regulator may exercise the power conferred by subsection (6):

(a) on written application being made to the Regulator by the transferee; or

(b) on the Regulator's own initiative.

Transfer of unit - transferee already has a Registry account

(8) If the transferee already has a Registry account, the Regulator must, as soon as practicable after receiving the declaration of transmission, transfer the unit from the relevant Registry account kept by the transferor to a Registry account kept by the transferee.

Transfer of unit - transferee does not have a Registry account

(9) If:

(a) the transferee does not already have a Registry account; and

(b) in accordance with the request under regulations made for the purposes of subsection 10(1), the Regulator has opened a Registry account in the name of the transferee;

the Regulator must, as soon as practicable after opening the Registry account, transfer the unit from the relevant Registry account kept by the transferor to the Registry account kept by the transferee.

Record

(10) If the Regulator transfers the unit under subsection (8) or (9), the Registry must set out a record of the declaration of transmission.

When the transferee is the Commonwealth

(11) If the transferee is the Commonwealth, the Minister may give:

(a) the declaration of transmission; and

(b) the evidence mentioned in paragraph (3)(b);

on behalf of the transferee.

Notification

(12) If:

(a) the Regulator decides to:

(i) extend the 90-day period mentioned in subsection (3); or

(ii) refuse to extend the 90-day period mentioned in subsection (3); and

(b) the Regulator made the decision in response to an application;

the Regulator must give written notice of the decision to the applicant.

48F Transfer of safeguard mechanism credit units to another Registry account held by the transferor

Scope

(1) This section applies if:

(a) a person keeps a Registry account (the first Registry account ) in which there is an entry for a safeguard mechanism credit unit; and

(b) the person, by electronic notice transmitted to the Regulator, instructs the Regulator to transfer the unit from the first Registry account to another Registry account kept by the person; and

(c) the instruction sets out:

(i) the account number of the first Registry account; and

(ii) the account number of the other Registry account.

Compliance with instruction

(2) If a person gives the Regulator an instruction under paragraph (1)(b), the Regulator must comply with the instruction as soon as practicable after receiving it.

(3) The Registry must set out a record of the instruction under paragraph (1)(b).

48G Registration of equitable interests in relation to a safeguard mechanism credit unit

(1) The legislative rules may make provision for or in relation to the registration in the Registry of equitable interests in relation to safeguard mechanism credit units.

(2) Subsection (1) does not apply to an equitable interest that is a security interest within the meaning of the Personal Property Securities Act 2009, and to which that Act applies.

48H Equitable interests in relation to a safeguard mechanism credit unit

(1) This Act does not affect:

(a) the creation of; or

(b) any dealings with; or

(c) the enforcement of;

equitable interests in relation to a safeguard mechanism credit unit.

(2) Subsection (1) is enacted for the avoidance of doubt.

48J Legislative rules about safeguard mechanism credit units

The legislative rules may make further provision in relation to safeguard mechanism credit units.