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2008-2009
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
National Consumer Credit Protection (Fees) Bill 2009
EXPLANATORY MEMORANDUM
(Circulated by the authority of the
Minister for Human Services
Minister for Financial Services, Superannuation and Corporate Law
the Hon Chris Bowen MP)
Table of contents
Glossary 1
General outline and financial impact 3
Chapter 1 Imposition of fees 5
Glossary
The following abbreviations and acronyms are used throughout this
explanatory memorandum.
|Abbreviation |Definition |
|ASIC |Australian Securities and |
| |Investments Commission |
|COAG |Council of Australian |
| |Governments |
|Consumer Credit |National Consumer Credit |
|Protection Reform |Protection Bill 2009, |
|Package |National Consumer Credit |
| |Protection (Transitional and |
| |Consequential Provisions) |
| |Bill 2009, and the National |
| |Consumer Credit Protection |
| |(Fees) Bill 2009 |
|Credit Bill |National Consumer Credit |
| |Protection Bill 2009 |
|Fees Bill |National Consumer Credit |
| |Protection (Fees) Bill 2009 |
|Transitional Bill |National Consumer Credit |
| |Protection (Transitional and |
| |Consequential Provisions) |
| |Bill 2009 |
General outline and financial impact
Outline
The National Consumer Credit Protection (Fees) Bill 2009 (Fees
Bill), which accompanies the National Consumer Credit Protection
Bill 2009 (Credit Bill) and the National Consumer Credit Protection
(Transitional and Consequential Provisions) Bill 2009 (the
Transitional Bill), support the Commonwealth's regulation of
consumer credit in Australia.
The Fees Bill enables the imposition of fees, as taxes, for things
done under the Credit Bill and Transitional Bill, such as the
lodgment of documents, or inclusion of a document in, or inspection
of, a register maintained by the Australian Securities and
Investments Commission (ASIC).
Date of effect: The Fees Bill commences at the same time as
section 3 of the National Consumer Credit Protection Bill 2009.
Proposal announced: The proposal to transfer responsibility for
regulating consumer credit to the Commonwealth was announced by the
Council of Australian Governments (COAG) on 26 March, 3 July and
2 October 2008.
Financial impact: The Government has provided $70.2 million over
four years to implement the decision of COAG as part of the 2008-09
Mid-Year Economic and Fiscal Outlook. This Bill includes measures
to give effect to that transfer.
The funding will support the establishment of a national licensing
regime for providers of credit and credit services, with ASIC as
the sole national regulator. It will also support the national
regulation of mortgages, margin lending, personal loans, credit
cards and pay day lending.
The funding will be partially offset by revenue raised from fees
required to be paid by persons regulated by the national framework,
payment of which commences during the 2009-10 financial year. The
amount of revenue generated from these fees will depend, in part,
on the number and type of persons seeking to be licensed.
Compliance cost impact: The main compliance cost impact arises in
relation to persons who will be subject to the licensing regime.
This will primarily involve the initial costs associated with
applying for an Australian credit licence, which include the
payment of fees to lodge application documentation with ASIC,
annual compliance costs and costs of external dispute resolution
membership.
Further details in relation to the compliance requirements
associated with the licensing of providers of credit and credit
services are set out in the Regulation Impact Statement
accompanying the Credit Bill.
Summary of regulation impact statement
Regulation impact on business
Impact: A regulation impact statement was prepared for the
Consumer Credit Protection Reform Package and is set out in the
explanatory memorandum to the Credit Bill.
Chapter 1
Imposition of fees
Outline of chapter
1. The National Consumer Credit Protection (Fees) Bill 2009 (Fees
Bill) allows for the imposition of fees for things done under the
National Consumer Credit Protection Bill 2009 (Credit Bill) and the
National Consumer Credit Protection (Transitional and Consequential
Provisions) Bill 2009 (Transitional Bill) such as the lodgment of
documents or the inclusion of a document in, or inspection of, a
register maintained by the Australian Securities and Investments
Commission (ASIC).
Context of new law
2. Section 55 of the Constitution provides, in part, that laws
imposing taxation shall deal only with imposing taxation, and any
provision dealing with any other matter shall not be effective. To
comply with this requirement, the Fees Bill, which imposes fees for
chargeable matters as a tax, is a separate piece of legislation
from the Credit Bill and the Transitional Bill.
3. The approach taken in the Fees Bill is generally consistent with
the Corporations (Fees) Act 2001 which deals with the imposition of
fees under the Corporations Act 2001.
4. The fees imposed under the Fees Bill are payable to the
Commonwealth (through ASIC) by the application of Part 5-4 of the
Credit Bill.
Summary of new law
5. The Fees Bill contains provisions relating to the:
. imposition of fees for chargeable matters;
. the ability to charge fees at different rates, for example
depending on the method used to lodge a document or the
number of representatives a person has; and
. assignment of liability for payment a fee.
Detailed explanation of new law
What is a chargeable matter?
6. The key provision in the Fees Bill is the definition of the term
chargeable matter. It is defined broadly to mean any of the
following:
. the lodgment of a document under the Credit Bill and
Transitional Bill;
. the inclusion of a document in a register maintained under
those Bills;
. the inspection or search of a register kept by, or a
document in the custody of, ASIC under those Bills;
. the making available by ASIC, under those Bills, of
information (whether in the form of a document or
otherwise);
. the production by ASIC, under a subpoena, of such a
register or document;
. the issuing of a document or of a copy of a document, the
granting of a licence, registration, consent or approval,
or the doing of any other act, under those Bills, by the
Minister or ASIC;
. the making of an inquiry of, or an application to, the
Minister, or ASIC, in relation to a matter arising under
those Bills; and
. the submission to ASIC of a document for examination by
ASIC.
[Subsection 4(1)]
1.
JJF Pty Ltd lodges an application for a licence to engage in
credit activities with ASIC in accordance with section 35 of
the Credit Bill.
The lodgment of an application by JJF Pty Ltd is a
chargeable matter, for which a fee may be imposed.
Other definitions
7. A representative of a registered person is defined in section 4 of
the Transitional Bill. A representative of a licensee, or in any
other case, is defined in section 5 of the Credit Bill.
[Subsection 4(1)]
8. Other expressions used in this Bill that are defined in the Credit
Bill and the Transitional Bill have the same meanings as they have
in those Bills. [Subsection 4(2)]
Imposition of, and matters relating to amount of, fees
9. Fees for chargeable matters may be prescribed in the regulations
[subsection 5(1)]. Any fees prescribed will be imposed as a tax to
ensure compliance with constitutional requirements [subsection
5(2)].
10. Two or more fees may be prescribed for the same chargeable matter.
[Subsection 5(3)]
11. Fees for chargeable matters may be prescribed in the regulations by
specifying an amount as the fee (not exceeding $10,000) or by
specifying a method of calculating the amount of the fee. The
$10,000 maximum applies separately to each fee imposed if more than
one fee is prescribed for the same chargeable matter. [Subsection
6(1)]
12. A fee for a chargeable matter need not bear any relationship to the
cost of providing any service that forms part of, or is related to,
that matter. [Subsection 6(2)]
13. A fee, or the sum of fees, for a chargeable matter must not exceed
$50,000. [Subsection 6(3)]
Different fees in relation to chargeable matter
14. Regulations may prescribe that fees can be charged at different
rates depending whether or not a chargeable matter is complied with
by electronic means. [Section 7]
1.
The fee for lodging an annual compliance certificate (as
required by section 53 of the Credit Bill) electronically
may be lower in comparison to the fee imposed for lodging
the same document in paper form.
15. Regulations may also prescribe that fees can be charged at
different rates depending on the number of representatives that the
person who is liable for the fee has at a particular time.
[Section 8]
1.
This allows for the amount of a fee that is to be imposed on
a licensee to be calculated based on the number of credit
representatives they authorise under sections 64 and 65 of
the Credit Bill.
Who is liable to pay the fee for a chargeable matter, and time liability is
incurred?
16. The person who is liable to pay the fee imposed for each chargeable
matter, and the time at which the liability arises, is described in
Table 1.1. [Section 9]
1.
|Chargeable |Who is liable |Time liability |
|matter | |arises |
|(subsection 4(1| | |
|)) | | |
|lodgment of a |person who |when the document|
|document |lodges the |is lodged |
| |document | |
|inclusion of a |person who |when the request |
|document in the|requests |for inclusion of |
|register |inclusion of the|the document in |
| |document in the |the register or |
| |register or if |if no request, |
| |no request, the |when the document|
| |person who |is lodged |
| |lodges the | |
| |document | |
|inspection or |person who |when the request |
|search of a |requests the |is made |
|register or |information | |
|document kept | | |
|by ASIC | | |
|information |person who |when the request |
|made available |requests the |is made |
|by ASIC |information | |
|production of |person who filed|when the subpoena|
|register or |the subpoena |is served on ASIC|
|document by | | |
|ASIC under a | | |
|subpoena | | |
|issuing a |person |when the request |
|document or |requesting issue|is made, or if |
|copy, granting |of the document |there is no |
|a licence, |or copy, the |request, when the|
|consent or |grant of the |act is done |
|approval, or |licence, consent| |
|doing any other|or approval, or | |
|act by the |any other act. | |
|Minister or |If there is no | |
|ASIC |request, the | |
| |person for whose| |
| |benefit the act | |
| |is done | |
|Chargeable |Who is liable |Time liability |
|matter | |arises |
|(subsection 4(1| | |
|)) | | |
|making an |person who makes|when the inquiry |
|inquiry of, or |the inquiry or |or application is|
|application to,|application |made |
|ASIC or the | | |
|Minister | | |
|submitting a |person |when the document|
|document to |submitting the |is submitted |
|ASIC for |document | |
|examination | | |
Regulations
The Fees Bill provides that the Governor-General may make regulations for
the purposes of sections 5 to 8. [Section 10]