November 2011
Welcome to our November edition of Legal and regulatory developments in Australia. Since our last edition a number of significant changes have occurred in the Australian regulatory landscape. We summarise these changes below.
Let me know if we can provide more details about these changes or assist you with any other Australian legal or regulatory issues.
Best wishes,
Robert Hanley, Partner
London
Carbon scheme kicks off in 2012
The Australian government carbon trading scheme will come into force on 1 July 2012 and all Australian-based businesses are (or should be) preparing for the new regime. Virtually all businesses will be affected in some way, either being required to purchase and surrender carbon permits in relation to emissions, or subject to higher costs for electricity or emissions intensive items. Businesses directly involved in emissions intensive businesses and coal fired electricity production will be liable as will those responsible for off-road fuel use and the supply of natural gas. Carbon permits will be traded as financial products which will bring new businesses into the Australian Financial Services Licences (AFSL) regime and require others to vary their AFSL. Read more here.
More onerous financial requirements for managed investment scheme responsible entities
ASIC has released a Class Order bringing in more onerous financial requirements for responsible entities of registered managed investment schemes. The new requirements include the preparation of rolling cash flow projections, changed (and increased) requirements in relation to net tangible asset requirements and a liquidity requirement. As well as new requirements, there have been changes to some defined terms in the current financial requirements which will require careful attention. The new rules come into force on 1 November 2012. Read more here.
Improving disclosure in prospectuses
Following an extensive industry consultation, ASIC has published a regulatory guide on improving disclosure in prospectuses. The guide focuses on the content and form of prospectuses prepared for floats and will clarify disclosure issues although the prospectus may get longer. Read more here.
Mining tax gets closer
Two draft bills dealing with the development of the mining tax have been published for public consultation. The bills include various amendments to the initial draft legislation, particularly to clarify what will be included within the regime and when it will apply. This new tax will involve a significant compliance burden but the Australian government seems determined to introduce the tax by 1 July 2012 to apply to all miners. Read more here.
Proposed Australian transfer pricing reforms
The Australian Government is considering retrospective changes to the domestic transfer pricing regime to bring them more closely into line with the OECD’s approach. Read more here.
Personal Property Securities Act (PPSA) start date may slip further
The PPSA security registration regime was originally due to come into force on 31 October, but this was delayed to provide for a final test of the new register. Commencement is currently set for 1 February 2012 or earlier if determined by the relevant Minister. This is now to be amended to allow the Minister to determine a later commencement date in case the new registration system is not ready in time. Read more here.
Australian banks to issue covered bonds
As we reported in our last issue, banks and other authorised deposit-taking institutions in Australia can now issue covered bonds. In the latest edition of Regulator, our monthly focus on developments in financial sector regulation, Rowan Russell and Greg Hammond consider the key features of the new framework. Read more here.
ASIC to revise policy on downstream acquisitions
ASIC has issued a consultation paper proposing changes to its regulatory guide in relation to downstream acquisitions (where a person acquires an interest in shares in an Australian subsidiary by reason of an acquisition of its foreign parent). The proposed changes will consolidate and clarify the guidance, bringing it into line with current law and recent Takeover Panel decisions. Read more here.