Financial Sector Reform (New South Wales) Act 1999 (NSW)

Financial Sector Reform (New South Wales) Act 1999 No 1 An Act to make provision for the reform of the financial sector; to dissolve the New South Wales Financial Institutions Commission; to repeal the Financial Institutions (New South Wales) Act 1992, the Friendly Societies (New South Wales) Act 1997, and the Financial Institutions Commission Act 1992; to amend certain Acts; and for other purposes. Part 1 Preliminary 1 Name of Act and purposes (1) This Act is the Financial Sector Reform (New South Wales) Act 1999. (2) The main purposes of this Act are: (a) to facilitate the registration of building societies, credit unions and friendly societies and related bodies as companies under the Corporations Law in accordance with amendments made by the Financial Sector Reform (Amendments and Transitional Provisions) Act (No. 1) 1999 of the Commonwealth, and (b) to facilitate the transfer of businesses under the Financial Sector (Transfers of Business) Act 1999 of the Commonwealth, and (c) to wind up the New South Wales Financial Institutions Commission, and (d) to enact transitional and ancillary provisions. 2 Commencement (1) This Act commences on a day or days to be appointed by proclamation. (2) Different days may be appointed for the repeal of different provisions of any Act repealed by this Act. 3 Definitions In this Act: AFIC means the Australian Financial Institutions Commission established by the AFIC Act. AFIC Act means the Australian Financial Institutions Commission Act 1992 of Queensland. AFIC Code means the AFIC (NSW) Code. AFIC (NSW) Code means the provisions applying before the transfer date because of section 5 of the Financial Institutions (New South Wales) Act 1992, and includes the AFIC (NSW) Regulations. AFIC (NSW) Regulations means the provisions applying before the transfer date because of section 6 of the Financial Institutions (New South Wales) Act 1992. AFIC Regulations means the AFIC (NSW) Regulations. APRA means the Australian Prudential Regulation Authority. APRA Act means the Australian Prudential Regulation Authority Act 1998 of the Commonwealth. APRA employee means a person appointed under section 45 of the APRA Act. ASIC means the Australian Securities and Investments Commission. authorised APRA officer, in a provision of Part 4, means a person authorised under section 9 to perform or exercise the functions or powers of an authorised APRA officer under that provision. employee, in relation to AFIC or FINCOM, includes a person engaged by AFIC or FINCOM on a contract for services. enforcement power means a function or power relating to: (a) the investigation of an offence, or (b) the institution and carrying on of a prosecution for an offence, or (c) matters relating to an investigation or prosecution of an offence. Financial Institutions Code means the Financial Institutions (NSW) Code. financial institutions legislation has the same meaning as in the AFIC Code. Financial Institutions (NSW) Code means the provisions applying before the transfer date because of section 8 of the Financial Institutions (New South Wales) Act 1992, and includes the Financial Institutions (NSW) Regulations. Financial Institutions (NSW) Regulations means the provisions applying before the transfer date because of section 9 of the Financial Institutions (New South Wales) Act 1992. FINCOM means the New South Wales Financial Institutions Commission. FINCOM employee means a member of the staff of FINCOM employed under section 18 of the Financial Institutions Commission Act 1992, and includes the Chief Executive of FINCOM. fiscal bodies legislation has the same meaning as in section 3 of the AFIC Code. Friendly Societies Code means the Friendly Societies (NSW) Code. Friendly Societies (NSW) Code means the provisions applying before the transfer date because of section 5 of the Friendly Societies (New South Wales) Act 1997, and includes the Friendly Societies (NSW) Regulations. Friendly Societies (NSW) Regulations means the provisions applying before the transfer date because of section 6 of the Friendly Societies (New South Wales) Act 1997. FSR Act means the Financial Sector Reform (Amendments and Transitional Provisions) Act (No. 1) 1999 of the Commonwealth. FS(TB) Act means the Financial Sector (Transfers of Business) Act 1999 of the Commonwealth. jurisdiction means a State or Territory. relevant Commonwealth body means APRA or ASIC. SSA means State Supervisory Authority. transfer date means the date that, under section 3 (16) of the FSR Act, is specified as the transfer date for the purposes of that Act. 4 Act to bind Crown (1) This Act binds the Crown in right of New South Wales and, in so far as the legislative power of the Parliament of New South Wales permits, the Crown in all its other capacities. (2) Nothing in this section makes the Crown in any of its capacities liable to be prosecuted for an offence. Part 2 Registration of certain entities as companies 5 Transferring financial institutions (1) On the transfer date, each transferring financial institution of this jurisdiction is taken, in accordance with Schedule 4 to the Corporations Law of New South Wales, to become registered as a company under that Law under the name under which the institution was registered under the previous governing Code immediately before the transfer date. (2) Subsection (1) applies even if the institution is an externally-administered body corporate immediately before the transfer date. (3) Registration under the Corporations Law of New South Wales of a transferring financial institution of this jurisdiction as a company does not create a new legal entity. (4) In this section, previous governing Code and transferring financial institution of this jurisdiction have the same respective meanings as they have in Schedule 4 to the Corporations Law. Part 3 Conferral of functions and powers on APRA and ASIC 6 Conferral of functions and powers on APRA (1) APRA has the functions and powers conferred or expressed to be conferred on it by or under this Act. (2) APRA has power to do acts in New South Wales in the performance or exercise of any function or power conferred or expressed to be conferred on APRA by or under a law of another jurisdiction corresponding to this Act. (3) Without limiting the operation of section 31 of the Interpretation Act 1987, this section does not purport to impose a duty on APRA to perform any function or exercise any power conferred or expressed to be conferred on it by or under this Act if the imposition of the duty would be beyond the legislative power of the Parliament of the State. 7 Conferral of functions and powers on ASIC (1) ASIC has the functions and powers conferred or expressed to be conferred on it by or under this Act. (2) ASIC has power to do acts in New South Wales in the performance or exercise of any function or power conferred or expressed to be conferred on ASIC by or under a law of another jurisdiction corresponding to this Act. (3) Without limiting the operation of section 31 of the Interpretation Act 1987, this section does not purport to impose a duty on ASIC to perform any function or exercise any power conferred or expressed to be conferred on it by or under this Act if the imposition of the duty would be beyond the legislative power of the Parliament of the State. Part 4 Authorised deposit-taking institutions and life insurance companies: transfer of business 8 Words defined in FS(TB) Act Unless the contrary intention appears, words defined in the FS(TB) Act have the same respective meanings in this Part. 9 Authorised APRA officer (1) APRA may, in writing, authorise a person who is an APRA board member, or an APRA staff member, to perform or exercise the functions or powers of an authorised APRA officer under a particular provision of this Part. (2) The functions and powers necessary for the purposes of this section are conferred on APRA. 10 Voluntary transfers (1) The purpose of this section is to facilitate voluntary transfers of business under Part 3 of the FS(TB) Act for regulated bodies. (2) This section applies when a certificate of transfer issued under section 18 of the FS(TB) Act comes into force under Division 3 of Part 3 of that Act. (3) The receiving body is taken to be the successor in law to the transferring body, to the extent of the transfer. (4) In particular: (a) if the transfer is a total transfer, all the assets and liabilities of the transferring body become respectively the assets and liabilities of the receiving body without any transfer, conveyance or assignment, and (b) if the transfer is a partial transfer, all the assets and liabilities of the transferring body included in the list of assets and liabilities specified in the statement of detail become respectively assets and liabilities of the receiving body without any transfer, conveyance or assignment, and (c) to the extent of the transfer, the duties, obligations, immunities, rights and privileges applying to the transferring body apply to the receiving body. (5) If there is an approved section 20 statement in relation to the transfer that specifies: (a) that particular things are to happen or are taken to be the case—those things are taken to happen, or to be the case, in accordance with the statement, or (b) a mechanism for determining things that are to happen or are taken to be the case—things determined in accordance with that mechanism are taken to happen, or to be the case, as determined in accordance with that mechanism. 11 Compulsory transfers (1) The purpose of this section is to facilitate compulsory transfers of business under Part 4 of the FS(TB) Act for regulated bodies. (2) This section applies when a certificate of transfer issued under section 33 of the FS(TB) Act comes into force under Division 3 of Part 4 of that Act. (3) The receiving body is taken to be the successor in law to the transferring body, to the extent of the transfer. (4) In particular: (a) if the transfer is a total transfer, all the assets and liabilities of the transferring body become respectively the assets and liabilities of the receiving body without any transfer, conveyance or assignment, and (b) if the transfer is a partial transfer, all the assets and liabilities of the transferring body included in the list, referred to in section 33 (2) (c) of the FS(TB) Act, included in, or attached to, the certificate of transfer become respectively assets and liabilities of the receiving body without any transfer, conveyance or assignment, and (c) to the extent of the transfer, the duties, obligations, immunities, rights and privileges applying to the transferring body apply to the receiving body. (5) If the certificate of transfer includes provisions of a kind referred to in section 33 (3) of the FS(TB) Act specifying: (a) that particular things are to happen or are taken to be the case—those things are taken to happen, or to be the case, in accordance with those provisions, or (b) a mechanism for determining things that are to happen or are taken to be the case—things determined in accordance with that mechanism are taken to happen, or to be the case, as determined in accordance with that mechanism. (6) If there is an approved section 30 statement in relation to the transfer that specifies: (a) that particular things are to happen or are taken to be the case—those things are taken to happen, or to be the case, in accordance with the statement, or (b) a mechanism for determining things that are to happen or are taken to be the case—things determined in accordance with that mechanism are taken to happen, or to be the case, as determined in accordance with that mechanism. 12 Certificates evidencing operation of Part (1) An authorised APRA officer may, by a certificate in writing signed by the officer, certify any matter in relation to the operation or effect of this Part, and, in particular, may certify that: (a) a particular asset of a transferring body has become a transferred asset of a receiving body, or (b) a particular liability of a transferring body has become a transferred liability of a receiving body. (2) For all purposes and in all proceedings, a certificate under subsection (1) is evidence of the matters certified. 13 Certificates in relation to land and interests in land If: (a) a receiving body becomes, under this Part, the owner of land, or of an interest in land, that is situated in New South Wales, and (b) there is lodged with the Registrar-General a certificate that: (i) is signed by an authorised APRA officer, and (ii) identifies the land or interest, and (iii) states that the receiving body has, under this Part, become the owner of that land or interest, the Registrar-General may: (c) register or record the matter in the same manner as dealings in land or interests in land of that kind are registered or recorded, and (d) deal with, and give effect to, the certificate. 14 Certificates in relation to other assets (1) If: (a) an asset (other than land or an interest in land) becomes, under this Part, an asset of a receiving body, and (b) there is lodged with the person or authority who has, under the law, responsibility for keeping a register or record in respect of assets of that kind a certificate that: (i) is signed by an authorised APRA officer, and (ii) identifies the asset, and (iii) states that the asset has, under this Part, become an asset of the receiving body, that person or authority may: (c) register or record the matter in the same manner as transactions in relation to assets of that kind are registered or recorded, and (d) deal with, and give effect to, the certificate. (2) This section does not affect the operation of the Corporations Law. 15 Documents purporting to be certificates A document purporting to be a certificate given under this Part is, unless the contrary is established, taken to be such a certificate and to have been properly given. 16 Relationship of Part with other instruments (1) This Part has effect despite anything in a contract, deed, undertaking, agreement or other instrument. (2) Nothing done under this Part: (a) places a receiving body, a transferring body or another person in breach of contract or confidence or otherwise makes any of them guilty of a civil wrong, or (b) places a receiving body, a transferring body or another person in breach of: (i) a law of the State, or (ii) a contractual provision prohibiting, restricting or regulating the assignment or transfer of an asset or liability or the disclosure of information, or (c) releases a surety, wholly or in part, from all or any of the surety's obligations. (3) Without limiting subsection (1), if, apart from this section, the advice or consent of a person would be necessary in a particular respect, the advice is taken to have been obtained or the consent is taken to have been given. Part 5 Repeals and transitional provisions Division 1 Repeals 17 Repeals (1) The following Acts are repealed: Financial Institutions (New South Wales) Act 1992 Friendly Societies (New South Wales) Act 1997. (2) The Financial Institutions Commission Act 1992 is repealed. Division 2 Provisions relating to AFIC Subdivision 1 AFIC to continue 18 AFIC continues to have certain powers (1) This section applies despite: (a) the repeal of the AFIC Act by the Financial Sector Reform (Queensland) Act 1999 of Queensland, and (b) the repeal of the Financial Institutions (New South Wales) Act 1992 and of the Friendly Societies (New South Wales) Act 1997 by section 17 (1) of this Act. (2) While AFIC continues in existence under the Financial Sector Reform (Queensland) Act 1999 of Queensland, AFIC has power: (a) to do any act in New South Wales that AFIC considers necessary or expedient to do for any of the purposes for which it continues in existence, and (b) to do any act in respect of a society that is or was registered under the Financial Institutions Code or the Friendly Societies Code that AFIC considers necessary or expedient to do for any of the purposes for which it continues in existence, and (c) to do any act that it is authorised to do by or under this Act. 19 Delegation of AFIC's powers (1) AFIC's board may delegate any of AFIC's powers under section 18 to an appropriately qualified employee of AFIC. (2) In subsection (1), appropriately qualified has the same meaning as in the Financial Sector Reform (Queensland) Act 1999 of Queensland. Subdivision 2 Provisions about AFIC's staff 20 Definition In this Subdivision: employees of AFIC includes the executive director of AFIC. 21 Transfer of staff to APRA under transfer agreement (1) The Queensland Minister administering the Financial Sector Reform (Queensland) Act 1999 of Queensland may enter into a transfer agreement under Division 2 of Part 1 of Schedule 8 to the FSR Act, that determines, or provides for determining, that particular employees of AFIC become APRA employees on a particular date, not being a date before the transfer date. (2) The transfer agreement has effect according to its terms. 22 Effect of transfer to APRA or Australian Public Service (1) This section applies if a person becomes an APRA employee under section 21. (2) This section also applies if: (a) a person is appointed to the Australian Public Service under section 81B (1) of the Public Service Act 1922 of the Commonwealth on or after the transfer date, and (b) immediately before the appointment, the person was an employee of AFIC. (3) If the person is the executive director of AFIC, the executive director's appointment under the AFIC Code immediately ends. (4) If the person is another employee of AFIC, the employee's employment with AFIC immediately ends. (5) A person is not entitled to receive any payment or other benefit, whether under a contract or otherwise, because the person's appointment or employment ends under this section. 23 Statement of accrued benefits and other details (1) Before an employee of AFIC becomes an APRA employee under section 21 or is appointed to the Australian Public Service as mentioned in section 22 (2), AFIC must give the person, and APRA or the Commonwealth Public Service Commissioner, a written statement. (2) The statement must state particulars of the benefits to which the person has an accrued entitlement, the person's remuneration and the person's length of service with AFIC. Subdivision 3 Information may be given to APRA or ASIC 24 Giving of information (1) This section applies to: (a) a director of AFIC's board, and (b) an employee of AFIC, and (c) a person appointed by AFIC to carry out duties under the fiscal bodies legislation, and (d) a person who has been a person mentioned in paragraph (a), (b) or (c). (2) A person to whom this section applies may disclose to APRA or ASIC information the person acquired while engaged in the administration of the fiscal bodies legislation. (3) This section applies despite section 155 of the AFIC Code and section 477 of the Friendly Societies Code. Subdivision 4 Transfer of AFIC's assets and liabilities 25 Transfer of assets and liabilities (1) The Queensland Minister administering the Financial Sector Reform (Queensland) Act 1999 of Queensland may enter into a transfer agreement under Division 3 of Part 1 of Schedule 8 to the FSR Act connected with the transfer of AFIC's assets or liabilities to APRA or ASIC. (2) The transfer agreement has effect according to its terms. Subdivision 5 Proceedings involving AFIC 26 Continuation and preservation of certain civil proceedings involving AFIC (1) This section applies to a proceeding: (a) whether or not it arose or arises under the fiscal bodies legislation, and (b) regardless of where it arose or arises. (2) For the purposes of a proceeding commenced before the transfer date to which AFIC was a party immediately before that date, the State of Queensland is substituted for AFIC as a party to the proceeding. (3) For the purposes of a proceeding not commenced before the transfer date and which could if commenced after that date be brought against AFIC, or but for the commencement of section 17 (1) and the dissolution of AFIC, could have been brought against AFIC, the proceeding may instead be brought against the State of Queensland. (4) For the purposes of this section, evidence that would have been admissible for or against AFIC is admissible for or against the State of Queensland. (5) This section does not apply to a proceeding for an offence. 27 Continuation of certain offence proceedings (1) This section applies to a proceeding for an offence brought under section 63 of the AFIC Code by AFIC, or a person authorised in writing by AFIC, that commenced before the transfer date but that was not completed before that date. (2) On and after the transfer date, the proceeding may continue to be prosecuted by either APRA or ASIC in place of AFIC or the person authorised by AFIC; and APRA or ASIC may be substituted in the proceeding for AFIC or the person. (3) The functions and powers necessary for this section are conferred on APRA and ASIC. Division 3 Provisions relating to FINCOM Subdivision 1 Dissolution of FINCOM 28 Dissolution of FINCOM (1) FINCOM and its Board are dissolved. (2) The members of the Board of FINCOM cease to hold office, and are not entitled to any compensation for loss of office. Subdivision 2 General 29 Supervision Fund (1) FINCOM must pay the money standing to the credit of the Supervision Fund established under section 94 of the Financial Institutions Code to such entities, in such amounts and at such times as the Minister determines. (2) Before making a determination under this section, the Minister must consult such representatives of the financial institutions industry and other persons as the Minister considers appropriate. 30 Credit Unions Contingency Fund (1) On the day before the transfer date, FINCOM must, under section 99A of the Financial Institutions Code, distribute the whole of retained earnings to the contribution accounts of credit unions. (2) For the purposes of subsection (1), section 99A (3) of the Financial Institutions Code does not apply. (3) On or as soon as practicable after the transfer date, FINCOM must pay to each credit union the amount standing to the credit union's credit in the Credit Unions Contingency Fund immediately before the transfer date, subject to any necessary adjustments. (4) Subsection (3) applies despite section 103 of the Financial Institutions Code. (5) In this section: contribution accounts of credit unions means the parts of the Credit Unions Contingency Fund that, under section 98 (10) of the Financial Institutions Code, are treated as a deferred asset in the accounts of the credit unions. credit union means a credit union under the Financial Institutions Code. retained earnings has the same meaning as in section 99A of the Financial Institutions Code. 31 Transitional arrangements regarding final report and audit of FINCOM (1) The purpose of this section is to make provision for reports, financial statements and auditing concerning FINCOM's affairs in relation to the period beginning with the transfer date and ending with the date on which FINCOM is dissolved. (2) The regulations may make provision for or with respect to the preparation and submission of a report of FINCOM's operations, the preparation and submission of financial statements relating to FINCOM, and the auditing of those statements and of the accounts to which they relate. (3) This section does not affect any obligations imposed by or under the Public Finance and Audit Act 1983, the Annual Reports (Statutory Bodies) Act 1984 or any other Act. Subdivision 3 Provisions about FINCOM's staff 32 Transfer of staff to APRA under transfer agreement (1) The Minister may enter into a transfer agreement under Division 2 of Part 1 of Schedule 8 to the FSR Act that determines, or provides for determining, that particular FINCOM employees become APRA employees on a particular date. (2) The transfer agreement has effect according to its terms. 33 Effect of transfer to APRA or Australian Public Service (1) This section applies: (a) if a person becomes an APRA employee under section 32, or (b) if: (i) a person is appointed to the Australian Public Service under section 81B (1) of the Public Service Act 1922 of the Commonwealth on or after the transfer date, and (ii) immediately before the appointment, the person was a FINCOM employee. (2) The employee's employment with FINCOM immediately ends. (3) A person is not entitled to receive any payment or other benefit, whether under a contract or otherwise, because the person's appointment or employment ends under this section. 34 Statement of accrued benefits and other details (1) Before a FINCOM employee becomes an APRA employee under section 32 or is appointed to the Australian Public Service as mentioned in section 33 (1) (b) (i), FINCOM must give the person, and APRA or the Commonwealth Public Service Commissioner, a written statement. (2) The statement must state particulars of: (a) the person's remuneration, and (b) the person's accrued benefits and entitlements in respect of service with FINCOM and prior service recognised by FINCOM, and (c) the person's length of service with FINCOM and the length of prior service recognised by FINCOM. Subdivision 4 Information may be given to APRA or ASIC 35 Giving of information (1) This section applies to: (a) a member of the Board of FINCOM, and (b) a FINCOM employee, and (c) a person appointed by FINCOM for the purpose of carrying out duties under the fiscal bodies legislation, and (d) a person who has been a person mentioned in paragraph (a), (b) or (c). (2) A person to whom this section applies may disclose to APRA or ASIC information the person acquired while engaged in the administration of the fiscal bodies legislation. (3) This section applies despite section 410 of the Financial Institutions Code and section 477 of the Friendly Societies Code. Subdivision 5 Transfer of FINCOM's assets and liabilities 36 Transfer of assets and liabilities (1) The Minister may enter into transfer agreements under Division 3 of Part 1 of Schedule 8 to the FSR Act connected with the transfer of FINCOM's assets or liabilities to APRA or ASIC. (2) The transfer agreement has effect according to its terms. Subdivision 6 Proceedings involving FINCOM 37 Continuation and preservation of civil proceedings involving FINCOM (1) For the purposes of a proceeding commenced before the transfer date to which FINCOM was a party immediately before that date, the State is substituted for FINCOM as a party to the proceeding. (2) For the purposes of a proceeding not commenced before the transfer date and which could, if commenced after that date, be brought against FINCOM, or but for the commencement of section 17 (2), could have been brought against FINCOM, the proceeding may instead be brought against the State. (3) For the purposes of this section, evidence that would have been admissible for or against FINCOM is admissible for or against the State. (4) This section does not apply to a proceedings for an offence. 38 Continuation of certain offence proceedings (1) This section applies to a proceeding for an offence brought under section 404 of the Financial Institutions Code or section 471 of the Friendly Societies Code by FINCOM, or a person authorised in writing by FINCOM, that commenced before the transfer date but was not completed before that date. (2) On and after the transfer date, the proceeding may continue to be prosecuted by either APRA or ASIC in place of FINCOM or the person authorised by FINCOM; and APRA or ASIC may be substituted in the proceeding for FINCOM or the person. (3) The functions and powers necessary for this section are conferred on APRA and ASIC. Division 4 APRA's and ASIC's functions and powers under Codes 39 Conferral of functions and powers relating to building societies, credit unions and friendly societies (1) Either relevant Commonwealth body has the same enforcement powers relating to anything done or omitted to be done under a Code before the transfer date as AFIC or FINCOM had immediately before that date. (2) For the purposes of subsection (1), a Code applies with all necessary changes. (3) In this section: Code means the AFIC Code, Financial Institutions Code or Friendly Societies Code. 40 AFIC Code provisions (1) Part 8 of the AFIC Code (other than sections 50, 51, 55 and 58) and the other provisions of the Code relevant to that Part, continue to apply on and after the transfer date in relation to anything done or omitted to be done before that date as if section 17 (1) had not commenced. (2) Despite subsection (1), a provision, or part of a provision, applying under that subsection that creates an offence is not limited in its application to anything done or omitted to be done before the transfer date. (3) For the purposes of the application mentioned in subsection (1): (a) a reference in the Code to AFIC is taken to be a reference to either relevant Commonwealth body, and (b) a reference in the Code to a financial institution is taken to be a reference to an entity that on the transfer date is a company under the Corporations Law and that, immediately before that date, was a financial institution under the Code, and (c) in section 52 (1) of the Code, the words "the financial institutions scheme" are taken to be omitted and the words "investigating whether an offence against the fiscal bodies legislation has been committed" are taken to be substituted, and (d) a reference in section 52 (1) (a) or (b) of the Code to an employee of AFIC or of a State supervisory authority is taken to be a reference to an employee of either relevant Commonwealth body, and (e) section 52 (5) of the Code is taken to be omitted, and (f) a reference in section 53 (1) or (2) of the Code to the executive director is taken to be a reference to either relevant Commonwealth body, and (g) a reference in section 53 (5) of the Code to officers and employees of the State supervisory authorities is taken to be a reference to officers and employees of either relevant Commonwealth body, and (h) section 63 (1A) and (1B) of the Code are taken to be omitted, and (i) a reference in section 63 (2) of the Code to the Ministerial Council is taken to be a reference to the Minister administering this Act, and (j) the Code applies with all other necessary changes. (4) This section does not limit section 39. 41 Financial Institutions Code provisions (1) Subdivision 1A of Division 2 of Part 2 (other than sections 75, 79 and 82), Part 10 and sections 392, 397, 398 and 404 of the Financial Institutions Code, and the other provisions of the Code relevant to that Subdivision, that Part and those sections, continue