CHAPTER 7
-
FINANCIAL SERVICES AND MARKETS
Note: This Chapter applies to a CCIV in a modified form: see Division
4
of Part
8B.7
.
History
Ch 7 amended by No 8 of 2022, s 3, Sch 2[165] (effective 1 July 2022).
Ch 7 inserted by No 122 of 2001, s 3, Sch 1, Pt 1
[
1].
As Act No 122 of 2001 repealed Ch 7 and 8 the history notes for Ch 7 use
"
inserted
"
and references to the former provisions have been removed.
PART 7.3A
-
CS SERVICES
History
Pt 7.3A inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
Division 1
-
Preliminary
History
Div 1 inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828
MEANING OF CS SERVICE
828(1)
A
CS service
is a service that can only be provided if it has access to a clearing and settlement facility, or to data used in the operation of a clearing and settlement facility.
828(2)
The operation of a clearing and settlement facility is taken to be the provision of a
CS service
.
History
S 828 inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
Division 2
-
Regulation of CS services: CS services rules
History
Div 2 inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
Subdivision A
-
Power to make CS services rules
History
Subdiv A inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828A
CS SERVICES RULES
828A(1)
ASIC may, by legislative instrument, make rules (the
CS services rules
) that deal with the following:
(a)
the activities, conduct or governance of CS facility licensees, and associated entities of CS facility licensees, in relation to CS services;
(b)
if regulations made for the purposes of this paragraph specify other persons
-
the activities, conduct or governance of those persons in relation to CS services;
(c)
matters that are incidental to the matters mentioned in paragraphs
(a)
and
(b)
.
828A(2)
Without limiting the scope of subsection
(1)
, the rules may deal with the following:
(a)
the specification of persons who are required to comply with requirements imposed by the rules;
(b)
for the purposes of subsection
822A(1)
-
matters with which the operating rules of a licensed CS facility must deal, in relation to CS services;
(c)
for the purposes of subsection
822A(2)
-
matters in respect of which a licensed CS facility must have written procedures, in relation to CS services;
(d)
for the purposes of subsection
822E(4)
-
matters to which the Minister must have regard, as mentioned in that subsection, in relation to CS services.
828A(3)
For the purposes of this section, governance of a person may be in relation to CS services even if there only an indirect relationship between the governance and CS services.
828A(4)
Despite subsection
(1)
, the rules cannot provide for matters in relation to a clearing and settlement facility that is exempt from the operation of Part
7.3
because of an exemption under section
820C
.
History
S 828A inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828B
CS SERVICES IN RELATION TO WHICH RULES MAY IMPOSE REQUIREMENTS
Requirements can only be imposed in relation to CS services covered by a determination under this section
828B(1)
The CS services rules cannot impose requirements in relation to CS services unless the CS services are covered by a determination under this section.
Minister may determine classes of CS services
828B(2)
For the purposes of subsection
(1)
, the Minister may, by legislative instrument, make a determination specifying one or more classes of CS services.
Making determinations by reference to matters
828B(3)
A determination under subsection
(2)
may specify a class of CS services by reference to any of the following matters:
(a)
CS facilities to which the CS services have access;
(b)
CS facilities, where data to which the CS services have access is used in the operation of the CS facilities;
(c)
financial products to which the CS services relate.
828B(4)
Subsection
(3)
does not limit:
(a)
the matters by reference to which a determination under subsection
(2)
may specify a class of CS services; and
(b)
the operation of subsection
13(3)
of the
Legislation Act 2003
.
Making determinations: matters to which the Minister has regard
828B(5)
In considering whether to make a determination under subsection
(2)
, the Minister:
(a)
must have regard to:
(i)
the likely effect on the Australian economy, and on the efficiency, integrity and stability of the Australian financial system, of making the determination; and
(ii)
the likely regulatory impact of making the determination; and
(iii)
the likely effect of making the determination on the safety, fairness and effectiveness of competition in the provision of CS services; and
(b)
must have regard to the matters (if any) raised by ASIC, the ACCC or the Reserve Bank of Australia in advice provided under subsection
(6)
in relation to the determination; and
(c)
may have regard to any other matters that the Minister considers relevant.
Note: Matters that the Minister may have regard to under paragraph
(c)
may, for example, include any relevant international standards and international commitments.
ASIC, ACCC or Reserve Bank may advise Minister
828B(6)
ASIC, the ACCC or the Reserve Bank of Australia may (on its own initiative) and must (at the request of the Minister):
(a)
consider whether a determination should be made under subsection
(2)
specifying one or more particular classes of CS services; and
(b)
advise the Minister accordingly.
Amendment and revocation of determinations
828B(7)
The Minister may amend or revoke a determination under subsection
(2)
in like manner and subject to like conditions (see subsections
33(3)
and
(3AA)
of the
Acts Interpretation Act 1901
).
History
S 828B inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
Subdivision B
-
Compliance with CS services rules
History
Subdiv B inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828C
828C
OBLIGATION TO COMPLY WITH CS SERVICES RULES
A person must comply with provisions of the CS services rules that apply to the person.
Note 1: This section is a civil penalty provision (see section
1317E
). For relief from liability to a civil penalty relating to this section, see section
1317S
.
Note 2: If there is an inconsistency between the standards determined under section
827D
and the CS services rules, the standards prevail: see subsection
827D(2A)
.
History
S 828C inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828D
OBLIGATION TO NOTIFY ASIC IN RESPECT OF BREACH
828D(1)
A person must give written notice to ASIC, as soon as practicable, if the person becomes aware that the person may no longer be able to meet, or has breached, an obligation under section
828C
.
Note: Failure to comply with this subsection is an offence (see subsection
1311(1)
).
828D(2)
A person contravenes this subsection if the person contravenes subsection
(1)
.
Note: This subsection is a civil penalty provision (see section
1317E
).
828D(3)
If ASIC receives a notice under subsection
(1)
, ASIC may give the Minister advice about the matter to which the notice relates.
History
S 828D inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828E
ALTERNATIVES TO CIVIL PROCEEDINGS
828E(1)
The regulations may provide for a person who is alleged to have contravened section
828C
to do one or more of the following as an alternative to civil proceedings:
(a)
pay a penalty to the Commonwealth;
(b)
undertake or institute remedial measures (including education programs);
(c)
accept sanctions other than the payment of a penalty to the Commonwealth;
(d)
enter into a legally enforceable undertaking.
828E(2)
The penalty payable under regulations made under paragraph
(1)(a)
in relation to an alleged contravention of a CS services rule must not exceed:
(a)
for an individual
-
3,000 penalty units; and
(b)
for a body corporate
-
15,000 penalty units.
828E(3)
Without limiting regulations that may be made for the purpose of paragraph
(1)(d)
, those regulations may provide for one or more of the following kinds of undertakings:
(a)
an undertaking to take specified action within a specified period;
(b)
an undertaking to refrain from taking specified action;
(c)
an undertaking to pay a specified amount within a specified period to the Commonwealth or to some other specified person.
History
S 828E inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828F
828F
FAILURE TO COMPLY WITH CS SERVICES RULES DOES NOT INVALIDATE TRANSACTION ETC.
A failure, in relation to a transaction, to comply with a requirement of the CS services rules does not invalidate the transaction or affect any rights or obligations arising under, or relating to, the transaction.
History
S 828F inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
Subdivision C
-
Power of ASIC to give directions etc.
History
Subdiv C inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828G
ASIC
'
S POWER TO GIVE DIRECTIONS TO PERSON NOT COMPLYING WITH OBLIGATIONS
828G(1)
If ASIC considers that a person is not complying, or is not likely to comply, with its obligations under the CS services rules, ASIC may give the person a direction, in writing, to do specified things that ASIC believes will promote compliance by the person with those obligations.
828G(2)
When ASIC gives the person the direction, ASIC must also give the person a statement, in writing, setting out the reasons for giving the direction.
828G(3)
The direction has effect until the earlier of the following times:
(a)
the time ASIC revokes the direction under subsection
(7)
;
(b)
the end of the period specified in the direction as the period during which the direction is effective.
828G(4)
While the direction has effect, the person must comply with the direction.
Note: Failure to comply with this subsection is an offence (see subsection
1311(1)
).
828G(5)
If the person fails to comply with the direction, ASIC may apply to the Court for, and the Court may make, an order that the person comply with the direction.
828G(6)
ASIC may vary the direction by giving written notice to the person.
828G(7)
ASIC may revoke the direction by giving written notice to the person.
History
S 828G inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
Subdivision D
-
The process of making CS services
History
Subdiv D inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828H
828H
MATTERS TO WHICH ASIC MUST HAVE REGARD WHEN MAKING RULES
In considering whether to make a CS services rule, ASIC:
(a)
must have regard to:
(i)
the likely effect of the proposed rule on the Australian economy, and on the efficiency, integrity and stability of the Australian financial system; and
(ii)
the likely regulatory impact of the proposed rule; and
(iii)
the likely effect of the proposed rule on the safety, fairness and effectiveness of competition in the provision of CS services; and
(iv)
if the proposed rule will impose requirements in relation to a CS service
-
the structure of the market for the provision of the CS service; and
(b)
must have regard to the matters (if any) raised by the ACCC or the Reserve Bank of Australia in consultations mentioned in paragraph
828J(1)(b)
; and
(c)
may have regard to any other matters that ASIC considers relevant.
Note: Matters that ASIC may have regard to under paragraph
(c)
may, for example, include any relevant international standards and international commitments.
History
S 828H inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828J
ASIC TO CONSULT BEFORE MAKING RULES
828J(1)
ASIC must not make a CS services rule unless ASIC:
(a)
has consulted the public about the proposed rule; and
(b)
has also consulted the following about the proposed rule:
(i)
the ACCC;
(ii)
the Reserve Bank of Australia;
(iii)
any other person or body as required by regulations made for the purpose of this subparagraph.
Note: In some situations, consultation is not required: see section
828L
.
828J(2)
Without limiting the ways in which ASIC may comply with the obligation in paragraph
(1)(a)
to consult the public about a proposed rule, ASIC is taken to comply with that obligation if ASIC, on its website:
(a)
makes the proposed rule, or a description of the content of the proposed rule, available; and
(b)
invites the public to comment on the proposed rule.
828J(3)
A failure to consult as required by subsection
(1)
does not invalidate a CS services rule.
History
S 828J inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828K
MINISTERIAL CONSENT TO RULES REQUIRED
828K(1)
ASIC must not make a CS services rule unless the Minister has consented, in writing, to the making of the rule.
Note: In some situations, consent is not required: see section
828L
.
828K(2)
A consent under subsection
(1)
is not a legislative instrument.
History
S 828K inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828L
EMERGENCY RULES: CONSULTATION AND CONSENT NOT REQUIRED
828L(1)
ASIC may make a CS services rule without consulting as required by section
828J
, and without the consent of the Minister as required by section
828K
, if ASIC is of the opinion that it is necessary, or in the public interest, to do so in order to protect:
(a)
the Australian economy; or
(b)
the efficiency, integrity and stability of the Australian financial system; or
(c)
safety, fairness and effective competition in the provision of CS services.
828L(2)
However, if ASIC does so, ASIC must:
(a)
provide the Minister, on the following day, with a written explanation of the need for the rule; and
(b)
amend or revoke the rule in accordance with any written directions of the Minister.
828L(3)
A direction under paragraph
(2)(b)
is not a legislative instrument.
828L(4)
ASIC must not make a CS services rule in accordance with subsection
(1)
unless ASIC has consulted the Reserve Bank of Australia about the proposed rule.
828L(5)
A failure to consult as required by subsection
(4)
does not invalidate a CS services rule.
History
S 828L inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828M
AMENDMENT AND REVOCATION OF CS SERVICES RULES
828M(1)
ASIC may amend or revoke a CS services rule in like manner and subject to like conditions (see subsections
33(3)
and
(3AA)
of the
Acts Interpretation Act 1901
).
828M(2)
However, the requirements of sections
828H
,
828J
and
828K
do not apply in relation to an amendment or revocation pursuant to a direction by the Minister under paragraph
828L(2)(b)
.
History
S 828M inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
Division 3
-
Other provisions
History
Div 3 inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828N
828N
ASIC MAY GIVE ADVICE TO MINISTER
ASIC may give advice to the Minister in relation to:
(a)
any matter in respect of which the Minister has a discretion under this Part; or
(b)
any other matter concerning the CS services rules.
Note: In some cases, the Minister must have regard to ASIC
'
s advice: see paragraph
827A(2)(h)
.
History
S 828N inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828P
828P
ACCC MAY GIVE ADVICE TO MINISTER
The ACCC may give advice to the Minister in relation to any matter concerning the CS services rules.
Note: In some cases, the Minister must have regard to the ACCC
'
s advice: see paragraph
827A(2)(h)
.
History
S 828P inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828Q
828Q
RESERVE BANK OF AUSTRALIA MAY GIVE ADVICE TO MINISTER
The Reserve Bank of Australia may give advice to the Minister in relation to:
(a)
any matter in respect of which the Minister has a discretion under this Part; or
(b)
any other matter concerning the CS services rules.
Note: In some cases, the Minister must have regard to the Reserve Bank
'
s advice: see paragraph
827A(2)(h)
.
History
S 828Q inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).
SECTION 828R
EXEMPTIONS BY THE REGULATIONS OR BY ASIC
828R(1)
The
provisions covered by this section
are:
(a)
the following provisions:
(i)
the provisions of this Part;
(ii)
the provisions of regulations made for the purposes of provisions of this Part;
(iii)
the provisions of rules made under Division
2
; and
(b)
definitions in this Act, or in the regulations, as they apply to references in provisions referred to in paragraph
(a)
.
828R(2)
The regulations, or ASIC by written instrument, may exempt a person or class of persons from all or specified provisions covered by this section.
828R(3)
An exemption may apply unconditionally or subject to specified conditions. A person to whom a condition specified in an exemption applies must comply with the condition. The Court may, on application by ASIC, order the person to comply with the condition in a specified way.
828R(4)
An exemption by ASIC is a legislative instrument if the exemption is expressed to apply in relation to a class of persons, (whether or not it is also expressed to apply in relation to one or more persons identified otherwise than by reference to membership of a class).
828R(5)
If subsection
(4)
does not apply to an exemption by ASIC, the exemption is a notifiable instrument.
828R(6)
If there is an inconsistency between:
(a)
an exemption prescribed by regulations made for the purposes of subsection
(2)
; and
(b)
an exemption by ASIC under that subsection;
(including in relation to any conditions specified by ASIC), the regulations prevail to the extent of the inconsistency.
History
S 828R inserted by No 75 of 2023, s 3, Sch 3[8] (effective 21 September 2023).