Corporations (Fees) Amendment Act 2001

The Corporations (Fees) Amendment Act 2001 is a short Commonwealth Act that amends the Corporations (Fees) Act 2001. Its role is targeted. It does not create a general new fee regime for all companies. Instead, it adds specific new categories of chargeable matters involving ASIC functions performed in relation to market licensees.

The amendment inserts two new categories into the definition of chargeable matter. Paragraph (k) covers the performance by ASIC of functions conferred on ASIC by the listing rules of a market as required by subsection 798C(4), and any other functions conferred on ASIC by arrangements entered into under subsection 798C(2). Paragraph (l) covers the performance by ASIC of functions provided for in regulations as mentioned in paragraph 798E(2)(b) of the Corporations Act 2001.

The Act also does two other practical things. First, it identifies the affected market licensee as the person liable for these new chargeable matters. Second, it places annual caps on the fees for the new paragraph (k) and paragraph (l) categories.

The text repeatedly points to market licensees as the affected entities. The new liability provisions in subsection 7(1), as amended, say that for both paragraph (k) and paragraph (l) chargeable matters, the person liable is the market licensee affected. That is the clearest practical indicator of who this law is aimed at.

In scope are businesses that operate licensed financial markets and have listing rules, arrangements or conflict-related regulatory settings that involve ASIC performing the kinds of functions described in the Act. Also in scope are the governance, legal, compliance and finance teams inside those businesses, because they are the people who will need to identify the chargeable matter, track the relevant 12 month period and manage payment processes.

Usually out are ordinary proprietary companies, family businesses, professional firms, retailers, hospitality businesses and standard startups that do not operate a licensed market. A company being listed on a market is not the same thing as operating the market. On the text available, the fee liability sits with the affected market licensee, not with every company that participates in the market.

The amendment does not apply just because ASIC is involved with your business in some general way. The trigger is narrower. A fee issue arises when ASIC is performing one of the specific functions picked up by the new chargeable matter categories.

For paragraph (k), the trigger is ASIC performing functions conferred by the listing rules of a market as required by subsection 798C(4), or other functions conferred on ASIC by arrangements entered into under subsection 798C(2). For paragraph (l), the trigger is ASIC performing functions provided for in regulations as mentioned in paragraph 798E(2)(b) of the Corporations Act 2001.

There is also a timing trigger. The Act says that for both paragraph (k) and paragraph (l) matters, the time liability is incurred is the time or times determined in accordance with the regulations. That means a business cannot work out the full compliance position from this amending Act alone. You need the regulations as well.

In practice, these trigger points are most likely to matter when a market operator is setting or changing listing rules, entering into formal arrangements that confer functions on ASIC, or dealing with a conflict or potential conflict that engages the relevant regulations. If your business is moving into the market operator space, these issues should be checked early rather than after invoices or notices arrive.

The Act adds annual caps for the new categories. For paragraph (k) chargeable matters, the fee, or total of the fees, relating to a particular market licensee must not exceed $100,000 for each period of 12 months during which ASIC performs the relevant functions in relation to that market licensee.

For paragraph (l) chargeable matters, the fee, or total of the fees, relating to a particular market licensee and a particular conflict or potential conflict of a kind referred to in subsection 798E(1) of the Corporations Act 2001 must not exceed the amount shown in the Act for each period of 12 months during which ASIC performs the relevant functions in relation to that market licensee and that conflict or potential conflict. The official text extract displays that amount with a formatting irregularity as $10 0,0 00. It appears to indicate $100,000, but that figure should be verified against the latest authorised legislation before being used for budgeting or compliance decisions.

A cap is not the same as a fixed fee. It is an upper limit for the relevant category over the relevant 12 month period. The actual fee position still depends on how the principal fees legislation and regulations operate. Businesses in scope should therefore treat the cap as one part of the analysis, not the whole answer.

From a practical business perspective, the cap matters for budgeting, board reporting and internal controls. If your organisation may be exposed to these fees, finance and compliance teams should track the relevant 12 month periods and keep records showing which ASIC functions relate to which market licensee and, for paragraph (l), which conflict or potential conflict.

This Act is short, but the practical obligations for an affected business are real. If you are the market licensee affected by one of the new chargeable matters, you need to identify that status, understand when liability is incurred under the regulations, and monitor the annual cap framework. Because the Act works by amending the Corporations (Fees) Act 2001, businesses should read it together with the current consolidated fees legislation and the relevant regulations.

Legal and compliance teams should review the documents that create or reflect ASIC's role. That includes listing rules, arrangements entered into under subsection 798C(2), and materials dealing with conflicts or potential conflicts that may engage the regulations mentioned in paragraph 798E(2)(b). The purpose of that review is to work out whether ASIC is performing a function that falls within paragraph (k) or paragraph (l).

Boards and company secretaries should also make sure there is a clear internal owner for fee monitoring. In many organisations, the legal team understands the trigger, the compliance team understands the regulatory context, and the finance team processes the payment. Without a clear allocation of responsibility, it is easy for timing and cap issues to be missed.

If your business is in the market operator category, this amendment should prompt a focused document review. The key question is not simply whether ASIC is involved, but exactly how ASIC's function arises and whether that function falls within one of the new chargeable matter categories.

Start with the market licence and any related approvals. Then review the market's listing rules, especially where those rules require or confer a role for ASIC. Next, review any arrangements entered into under subsection 798C(2). If your business is dealing with conflicts or potential conflicts of the kind referred to in subsection 798E(1), review the regulations and the internal records that describe those issues.

On the conduct side, businesses should make sure board papers, compliance reports and finance procedures are aligned. If ASIC is performing relevant functions over a 12 month period, the organisation should be able to identify the start of that period, the relevant market licensee, and any conflict or potential conflict connected with paragraph (l) matters. Good records will also help if the business later needs to reconcile invoices, notices or internal accruals.

The Act was assented to on 17 September 2001. Its commencement provision states that it commences on the commencement of item 1 of Schedule 1 to the Financial Services Reform Act 2001. Because this page is about an amending Act, businesses should not rely on the amending text alone to determine the current law. The safer approach is to check the latest authorised version of the principal legislation and any relevant regulations.

The Act is shown as in force. Even so, the practical effect for a business today depends on the current consolidated text of the Corporations (Fees) Act 2001, the current regulations, and the operation of the linked Corporations Act provisions referred to in the amendment.

Because this is specialist amending legislation, businesses should do a few checks before treating it as the final answer. First, confirm whether your entity is actually a market licensee. Second, identify whether ASIC is performing one of the specific functions described in paragraph (k) or paragraph (l). Third, check the regulations because they determine when liability is incurred. Fourth, verify the current consolidated legislation and the exact wording of the paragraph (l) fee cap in the latest authorised text.

For most founders and SMEs, the practical outcome of those checks will be that this Act is not directly relevant to day to day operations. For market operators and their advisers, however, these checks are essential because the Act allocates fee liability to the affected market licensee and uses a cap structure that depends on the category of function and the relevant 12 month period.