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Australian Securities and Investments Commission Bill 2001

Part 11 Companies Auditors and Liquidators Disciplinary Board

Division 1 Constitution of Disciplinary Board

203   Membership of Disciplinary Board

             (1)  The Disciplinary Board consists of:

                     (a)  a Chairperson; and

                     (b)  a member selected by the Minister from a panel of 5 persons, being persons resident in Australia, nominated by the National Council of the Institute of Chartered Accountants in Australia; and

                     (c)  a member selected by the Minister from a panel of 5 persons, being persons resident in Australia, nominated by the National Council of the Australian Society of Certified Practising Accountants.

Note:          The Disciplinary Board was established by section 202 of the Australian Securities and Investments Commission Act 1989 and is continued in existence by section 261 of this Act.

             (2)  A person is not eligible for appointment as Chairperson unless he or she is enrolled as a barrister, as a solicitor, as a barrister and solicitor or as a legal practitioner of the High Court, of any federal court or of the Supreme Court of a State or Territory and has been so enrolled for a period of at least 5 years.

             (3)  The Chairperson and each of the other members are to be appointed by the Minister on a part-time basis.

204   Functions and powers of Disciplinary Board

                   The Disciplinary Board has the functions and powers conferred on it by or under the corporations legislation (other than the excluded provisions).

205   Term of office

                   Subject to this Act, the Chairperson, each other member and each deputy of a member holds office for such term of at most 3 years as is specified in the instrument of his or her appointment, but is eligible for re-appointment.

206   Resignation from office

                   A person may resign his or her office as Chairperson, member or deputy of a member by writing signed and delivered to the Minister.

207   Termination of appointment

             (1)  The Minister may terminate the appointment of the Chairperson, any other member or a deputy of a member because of misbehaviour or physical incapacity.

             (2)  If the Chairperson, any other member or a deputy of a member:

                     (a)  is absent, without leave of the Disciplinary Board, from 3 consecutive meetings of the Board (being, in the case of a deputy of a member, meetings that the deputy is required to attend); or

                     (b)  becomes bankrupt, applies to take the benefit of a law for the relief of bankrupt or insolvent debtors, compounds with his or her creditors or assigns remuneration or property for their benefit; or

                     (c)  is convicted in Australia of an offence punishable by imprisonment for 12 months or longer; or

                     (d)  becomes of unsound mind; or

                     (e)  fails, without reasonable excuse, to comply with section 211;

the Minister must terminate his or her appointment.

208   Acting Chairperson

                   The Minister may appoint a person who is eligible for appointment as Chairperson to act as Chairperson:

                     (a)  during a vacancy in the office of Chairperson, whether or not an appointment has previously been made to the office; or

                     (b)  during any period, or during all periods, when the Chairperson is absent from office.

209   Appointment of deputies

             (1)  The Minister may:

                     (a)  appoint a person selected by him or her from the panel referred to in paragraph 203(1)(b) to be the deputy of the member referred to in that paragraph; and

                     (b)  appoint a person selected by him or her from the panel referred to in paragraph 203(1)(c) to be the deputy of the member referred to in that paragraph.

             (2)  A deputy of a member is entitled to attend meetings of the Disciplinary Board at which the member is not present and, while so attending, is taken to be a member of the Disciplinary Board.

210   Meetings

             (1)  The Chairperson must convene such meetings of the Disciplinary Board as he or she considers necessary for the performance of its functions.

             (2)  The Chairperson must preside at all meetings of the Disciplinary Board.

             (3)  At a meeting of the Disciplinary Board, the Chairperson and one member constitute a quorum.

             (4)  A question arising at a meeting of the Disciplinary Board must be determined by a majority of votes of the persons present and voting.

             (5)  At a meeting, the Chairperson has a deliberative vote and, in the event of an equality of votes, also has a casting vote.

             (6)  Subject to this section, the procedures for convening meetings of the Disciplinary Board and for the conduct of business by the Disciplinary Board must be as the Disciplinary Board determines.

211   Disclosure of interests

             (1)  For the purposes of this section, member includes a deputy of a member.

             (2)  A member who has a direct or indirect pecuniary interest in a matter being considered or about to be considered by the Disciplinary Board must, as soon as possible after the relevant facts have come to his or her knowledge, disclose the nature of his or her interest at a meeting of the Disciplinary Board.

             (3)  A disclosure under subsection (2) must be recorded in the minutes of the meeting of the Disciplinary Board and the member must not, unless the Minister or the Disciplinary Board otherwise determines:

                     (a)  be present during any deliberation of the Disciplinary Board with respect to that matter; or

                     (b)  take part in any decision of the Disciplinary Board with respect to that matter.

             (4)  For the purpose of the making of a determination by the Disciplinary Board under subsection (3) in relation to a member who has made a disclosure under subsection (2), a member who has a direct or indirect pecuniary interest in the matter to which the disclosure relates must not:

                     (a)  be present during any deliberation of the Disciplinary Board for the purpose of making the determination; or

                     (b)  take part in the making by the Disciplinary Board of the determination.

212   Remuneration and allowances

             (1)  In this section:

member includes a deputy of a member.

             (2)  A member must be paid such remuneration as is determined by the Remuneration Tribunal but, if no determination of that remuneration by the Tribunal is in operation, a member must be paid such remuneration as the Minister determines in writing.

             (3)  A member must be paid such allowances as the Minister determines in writing.

             (4)  This section has effect subject to the Remuneration Tribunal Act 1973 .

213   Confidentiality

             (1)  The Disciplinary Board must take all reasonable measures to protect from unauthorised use or disclosure information given to it in confidence in or in connection with the performance of its functions or the exercise of its powers under the corporations legislation (other than the excluded provisions).

             (2)  For the purposes of subsection (1), the disclosure of information:

                     (a)  as required or permitted by a law of the Commonwealth or a prescribed law of a State or Territory; or

                     (b)  in order to enable or assist an authority or person in:

                              (i)  a State or Territory; or

                             (ii)  a country outside Australia and the external Territories;

                            to perform or exercise a function or power that corresponds, or is analogous, to any of the Disciplinary Board’s, or ASIC’s functions and powers;

is taken to be authorised disclosure of the information.

214   Annual report

             (1)  The Disciplinary Board must, as soon as practicable after 30 June, and in any event before 31 October, in each year:

                     (a)  prepare a report describing the operations of the Disciplinary Board during the year that ended on 30 June in that year; and

                     (b)  give to the Minister a copy of the report.

             (2)  Where a copy of a report is given to the Minister under subsection (1), he or she must cause a copy of the report to be laid before each House of the Parliament within 15 sitting days of that House after he or she receives the first-mentioned copy.



 

Division 2 Hearings by Disciplinary Board

215   Definition

                   In this Division:

hearing means a hearing held by the Disciplinary Board under this Division.

216   Hearings

             (1)  The Disciplinary Board may, at a meeting of the Disciplinary Board, hold a hearing for the purpose of the performance of its functions, or the exercise of its powers.

             (2)  Subject to subsection (3), hearings must take place in private.

             (3)  If a person (other than ASIC) who is entitled to be given an opportunity to appear at a hearing requests that the hearing take place in public, the hearing must, subject to any directions of the Disciplinary Board under subsection (5), take place in public.

             (4)  The Disciplinary Board may give directions as to the persons who may be present at a hearing that is to take place in private.

             (5)  Where, at a hearing that is taking place in public at the request of a person, the Disciplinary Board is satisfied that it is desirable to do so by reason of the confidential nature of any evidence or matter or in order to protect the interests of any other person, the Disciplinary Board may:

                     (a)  direct that a part of the hearing take place in private and give directions as to the persons who may be present; or

                     (b)  give directions preventing or restricting the publication of evidence given before the Disciplinary Board or of matters contained in documents lodged with or produced to the Disciplinary Board.

             (6)  Nothing in a direction given by the Disciplinary Board under subsection (4) or paragraph (5)(a) prevents the presence at a hearing of:

                     (a)  a person representing ASIC pursuant to subsection 218(3); or

                     (b)  a person who is entitled to be given an opportunity to appear at the hearing; or

                     (c)  a person representing, pursuant to subsection 218(3), a person referred to in paragraph (b); or

                     (d)  a person representing, pursuant to subsection 218(3), a person who, by reason of a direction given by the Disciplinary Board under subsection (4), or paragraph (5)(a), of this section is entitled to be present at the hearing.

             (7)  Where the Disciplinary Board directs that a hearing or part of a hearing take place in private, a person (other than the Chairperson, a member, or a member of the staff of the Disciplinary Board approved by the Disciplinary Board) must not be present at the hearing unless he or she is entitled to be present by virtue of the direction or by virtue of subsection (6).

Penalty:  10 penalty units or imprisonment for 3 months.

             (8)  Where the Disciplinary Board is required to give a person an opportunity to appear at a hearing, the Disciplinary Board must appoint a day, time and place for the hearing and cause notice in writing of the day, time and place to be given to the person.

             (9)  A person who is entitled to be given an opportunity to appear at a hearing and who does not wish to appear at the hearing may, before the day of the hearing, lodge with the Disciplinary Board in writing any submissions that he, she or it wishes the Disciplinary Board to take into account in relation to the matter.

           (10)  The Disciplinary Board must take into account a submission made to or lodged with, or evidence adduced before, the Disciplinary Board when making any decision on the matter to which the submission or evidence relates.

217   Power to summon witnesses and take evidence

             (1)  The Chairperson or a member may summon a person to appear at a hearing to give evidence and to produce such documents (if any) as are referred to in the summons, being documents relating to the matters that are the subject of the hearing.

             (2)  The Disciplinary Board may, at a hearing, take evidence on oath or affirmation and for that purpose the Chairperson may:

                     (a)  require a person appearing at the hearing to give evidence to either take an oath or make an affirmation; and

                     (b)  administer an oath or affirmation to a person so appearing at the hearing.

             (3)  The oath or affirmation to be taken or made by a person for the purposes of subsection (2) is an oath or affirmation that the evidence he or she will give will be true.

218   Proceedings at hearings

             (1)  At a hearing:

                     (a)  the proceedings must be conducted with as little formality and technicality, and with as much expedition, as the requirements of the corporations legislation (other than the excluded provisions) and a proper consideration of the matters before the Disciplinary Board permit; and

                     (b)  the Disciplinary Board is not bound by the rules of evidence; and

                     (c)  the Disciplinary Board may, on such conditions as it thinks fit, permit a person to intervene in the proceedings.

             (2)  The Disciplinary Board must observe the rules of natural justice at and in connection with a hearing.

             (3)  At a hearing:

                     (a)  ASIC may be represented by:

                              (i)  a staff member, or a member or acting member, of ASIC; or

                             (ii)  a person authorised by ASIC for the purpose; and

                     (b)  a natural person may appear in person or may be represented by an employee of the person approved by the Disciplinary Board; and

                     (c)  a body corporate (other than ASIC) may be represented by an employee, or by a director or other officer, of the body corporate approved by the Disciplinary Board; and

                     (d)  an unincorporated association of persons or a member of an unincorporated association of persons may be represented by a member or officer of the association approved by the Disciplinary Board; and

                     (e)  any person may be represented by a barrister or solicitor of the Supreme Court of a State or Territory or of the High Court.

             (4)  A person who attends at a hearing pursuant to a summons issued under subsection 217(1) is entitled to be paid:

                     (a)  in a case where the summons was issued at another person’s request—by that other person; or

                     (b)  in any other case—by the Disciplinary Board;

such allowances and expenses as are provided for by the regulations.

             (5)  The Disciplinary Board may permit a person appearing as a witness at a hearing to give evidence by tendering, and, if the Disciplinary Board thinks fit, verifying by oath, a written statement.

219   Failure of witnesses to attend and answer questions

             (1)  A person served, as prescribed, with a summons to appear as a witness at a hearing must not, without reasonable excuse:

                     (a)  fail to attend as required by the summons; or

                     (b)  fail to attend from day to day unless excused, or released from further attendance, by the Chairperson.

             (2)  A person appearing as a witness at a hearing must not, without reasonable excuse:

                     (a)  when required pursuant to subsection 217(2) to either take an oath or make an affirmation—refuse or fail to comply with the requirement; or

                     (b)  refuse or fail to answer a question that he or she is required to answer by the Chairperson; or

                     (c)  refuse or fail to produce a document that he or she was required to produce by a summons under subsection 217(1) served on him or her as prescribed.

             (3)  A person must not, at a hearing, give evidence that is false or misleading.

             (4)  A person must not contravene subsection (1), (2) or (3).

Penalty:  10 penalty units or imprisonment for 3 months.

             (5)  A person who contravenes subsection (3) is not guilty of an offence against subsection (4) if it is proved that he or she, when giving the evidence, believed on reasonable grounds that it was true and not misleading.

             (6)  Where the Disciplinary Board is satisfied that:

                     (a)  a person served, as prescribed, with a summons to appear as a witness at a hearing has, without reasonable excuse, failed to attend as required by paragraph (1)(a) or (b); or

                     (b)  a person appearing as a witness at a hearing has, without reasonable excuse:

                              (i)  when required pursuant to subsection 217(2) either to take an oath or make an affirmation; or

                             (ii)  when required by the Chairperson to answer a question; or

                            (iii)  when required to produce a document by a summons under subsection 217(1) served on him or her as prescribed;

                            refused or failed to comply with the requirement;

the Chairperson may, by instrument in writing, certify the failure to attend or the refusal or failure to comply with the requirement, as the case may be, to the Court.

             (7)  Where a certificate is given under subsection (6), the Court may inquire into the case and, if it is satisfied that the person to whom the certificate relates has, without reasonable excuse, failed to attend or refused or failed to comply with a requirement as mentioned in the certificate:

                     (a)  may order the person to attend or to comply with the requirement at a hearing to be held at a time and place specified in the order; or

                     (b)  may punish the person in the same manner as if he or she had been guilty of contempt of the Court and, if it thinks fit, also make an order under paragraph (a).

220  Contempt of Disciplinary Board

             (1)  A person must not:

                     (a)  obstruct or hinder the Disciplinary Board or a member in the performance or exercise of any of the Disciplinary Board’s functions and powers; or

                     (b)  disrupt a hearing.

Penalty:  10 penalty units or imprisonment for 3 months.

             (2)  A person must not, without reasonable excuse, contravene a direction given under paragraph 216(5)(b).

Penalty:  10 penalty units or imprisonment for 3 months.

             (3)  An offence constituted by a contravention of subsection (1) or (2) is punishable on summary conviction.

221   Protection of members etc.

             (1)  The Chairperson or a member has, in the performance of his or her functions or the exercise of his or her powers as the Chairperson or a member in relation to a hearing, the same protection and immunity as a Justice of the High Court.

             (2)  A barrister, solicitor or other person appearing on behalf of a person at a hearing has the same protection and immunity as a barrister has in appearing for a party in proceedings in the High Court.

             (3)  Subject to this Act, a person summoned to attend or appearing as a witness at a hearing has the same protection as a witness in proceedings in the High Court.

222   Hearings taken to be judicial proceedings

                   A hearing is, for the purposes of Part III of the Crimes Act 1914 , taken to be a judicial proceeding.

223   Costs

             (1)  Where:

                     (a)  the Disciplinary Board holds a hearing in relation to a person in accordance with subsection 1294(1) of the Corporations Act; and

                     (b)  the Disciplinary Board cancels or suspends the registration of the person as an auditor, as a liquidator or as a liquidator of a specified body corporate, or deals with the person:

                              (i)  by admonishing or reprimanding the person; or

                             (ii)  by requiring the person to give an undertaking to engage in, or to refrain from engaging in, specified conduct;

the Disciplinary Board may require the person to pay an amount specified by the Disciplinary Board, being all or part of:

                     (c)  the costs of and incidental to the hearing; or

                     (d)  the costs of ASIC in relation to the hearing; or

                     (e)  the costs mentioned in paragraph (c) and the costs mentioned in paragraph (d).

             (2)  Where:

                     (a)  the Disciplinary Board holds a hearing in relation to a person in accordance with subsection 1294(1) of the Corporations Act; and

                     (b)  the Disciplinary Board refuses to make an order cancelling or suspending the registration of the person as an auditor, as a liquidator or as a liquidator of a specified body corporate, as the case requires, and does not deal with the person in any of the ways mentioned in subparagraphs (1)(b)(i) and (ii);

the Disciplinary Board may require ASIC to pay an amount specified by the Disciplinary Board, being all or part of:

                     (c)  the costs of and incidental to the hearing; or

                     (d)  the costs of the person in relation to the hearing; or

                     (e)  the costs mentioned in paragraph (c) and the costs mentioned in paragraph (d).

             (3)  Where:

                     (a)  under subsection (1), the Disciplinary Board requires a person to pay all or part of the costs of and incidental to a hearing held by the Disciplinary Board in relation to the person (whether or not the Disciplinary Board also requires the person to pay all or part of ASIC’s costs in relation to the hearing); or

                     (b)  under subsection (2), the Disciplinary Board requires ASIC to pay all or part of the costs of and incidental to a hearing held by the Disciplinary Board in relation to a person (whether or not the Disciplinary Board also requires ASIC to pay all or part of the costs of the person in relation to the hearing);

the amount of the costs of and incidental to the hearing so required to be paid by the first-mentioned person or by ASIC, as the case may be, may be recovered in a court of competent jurisdiction as a debt due to the Commonwealth.

             (4)  Where, under subsection (1), the Disciplinary Board requires a person to pay all or part of ASIC’s costs in relation to a hearing held by the Disciplinary Board in relation to the person (whether or not the Disciplinary Board also requires the person to pay all or part of the costs of and incidental to the hearing), the amount of ASIC’s costs so required to be paid by the person may be recovered in a court of competent jurisdiction as a debt due to the Commonwealth.

             (5)  Where, under subsection (2), the Disciplinary Board requires ASIC to pay all or part of the costs of a person in relation to a hearing held by the Disciplinary Board in relation to the person (whether or not the Disciplinary Board also requires ASIC to pay all or part of the costs of and incidental to the hearing), the amount of the costs of the person so required to be paid by ASIC may be recovered in a court of competent jurisdiction as a debt due to the person.