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Financial Sector Legislation Amendment (Review of Prudential Decisions) Bill 2008

Schedule 3 Removal of Ministerial consent

Part 1 Amendments commencing on Royal Assent

Insurance Act 1973

1  Subsection 15(2)

Repeal the subsection.

2  Subsection 15(4)

Omit “, with the Treasurer’s written agreement,”.

3  Subsection 21(2)

Repeal the subsection.

4  Subsection 21(4)

Omit “, with the Treasurer’s written agreement,”.

5  Subsection 32(3E)

Repeal the subsection.

6  Paragraph 52(1)(b)

Repeal the paragraph, substitute:

             (b)  it appears to APRA that information in its possession calls for the investigation of the whole or any part of the business of a general insurer or authorised NOHC;

7  Subsection 52(1AB)

Repeal the subsection, substitute:`

       (1AB)  Despite subsection (1), APRA may specify a period of less than 14 days in a notice under that subsection if:

                     (a)  APRA considers that specifying the shorter period is necessary; and

                     (b)  the period specified is reasonable in the circumstances.

8  Section 65

Omit:

•      Lloyd’s, or a company nominated by Lloyd’s, is required to lodge with the Treasurer a security deposit valued at $2 million. The deposit is available to meet the costs of judicial trusteeship of designated security trust funds.

substitute:

•      Lloyd’s, or a company nominated by Lloyd’s, is required to lodge with APRA a security deposit valued at $2 million. The deposit is available to meet the costs of judicial trusteeship of designated security trust funds.

9  Subsection 74(1)

Omit “with the Treasurer’s agreement,”.

10  Subsection 74(4)

Omit “unless the Treasurer has, during that period, agreed that the direction should remain in force or be varied”.

11  Before subsection 76(1)

Insert:

          (1A)  APRA may give a written notice under subsection (1) if APRA has reason to believe that the provision for liabilities in the accounts of a designated security trust fund is insufficient.

12  Subsection 76(1)

Omit “with the Treasurer’s agreement, by written notice given to the trustee of a”, substitute “by written notice given to the trustee of the”.

13  Subsection 78(2)

Omit “with the Treasurer’s agreement,”.

14  Subsection 78(5)

Omit “unless the Treasurer has, during that period, agreed that the direction should remain in force or be varied”.

15  Subsection 92Q(1)

Omit “the Treasurer”, substitute “APRA”.

16  Subsection 92Q(2)

Omit “the Treasurer”, substitute “APRA”.

17  Subsection 92Q(4)

Repeal the subsection, substitute:

             (4)  The deposit of securities with APRA in accordance with this section is effective to transfer the legal and beneficial interest in the securities to the Commonwealth. APRA has custody of the securities for and on behalf of the Commonwealth.

Note:          See subsections 11(4) and (5) of the Australian Prudential Regulation Authority Act 1998 .

18  Subsections 92Q(5) and (6)

Omit “the Treasurer” (wherever occurring), substitute “APRA”.

19  Subsection 92R(1)

Omit “the Treasurer”, substitute “APRA”.

20  Subsection 92R(2)

Omit “The Treasurer”, substitute “APRA”.

21  Subsection 92S(1)

Omit “the Treasurer” (wherever occurring), substitute “APRA”.

22  Subsection 93(3)

Omit “the Treasurer” (wherever occurring), substitute “APRA”.

23  Subsection 93(4)

Omit “Where the Treasurer makes a determination under subsection (3), he or she shall”, substitute “If APRA makes a determination under subsection (3), it must”.

24  Subsection 93(5)

Omit “the Treasurer”, substitute “APRA”.

25  Paragraphs 93(6)(a) and (b)

Omit “the Treasurer”, substitute “APRA”.

26  Paragraph 93(10)(a)

Omit “the Treasurer shall”, substitute “APRA must”.

27  Application

(1)       This item applies to any security that is lodged with the Treasurer under section 92Q of the Insurance Act 1973 immediately before this item commences.

(2)       Immediately after this item commences, the legal and beneficial interest in the security remains with the Commonwealth, and APRA is taken to have custody of the securities for and on behalf of the Commonwealth.

Life Insurance Act 1995

28  Subsection 21(1)

Repeal the subsection, substitute:

             (1)  APRA must, in writing, register a company that applies for registration under section 20, unless APRA is satisfied that a ground for refusal specified in subsection (3) exists.

29  Subsection 40(3)

Repeal the subsection.

30  Subsections 49(1) and (4)

Omit “, with the Treasurer’s agreement,”.

31  Subsections 62(4A) and 63(2A)

Repeal the subsections.

Superannuation Industry (Supervision) Act 1993

32  Subsection 29G(1)

Omit “Subject to subsection (3),”.

33  Subsection 29G(1) (note)

Omit “needs the consent of the Minister (see subsection (3)) or”.

34  Subsection 29G(3)

Repeal the subsection.

35  Subsection 133(5)

Repeal the subsection.

36  Subsection 146(1)

Omit “(1) APRA may”, substitute “APRA may”.

37  Subsection 146(2)

Repeal the subsection.

38  Subsection 264(6)

Repeal the subsection.



 

Part 2 Amendments contingent on the Financial Sector Legislation Amendment (Discretionary Mutual Funds and Direct Offshore Foreign Insurers) Act 2007

Division 1—Amendments if Schedule 2 to the Financial Sector Legislation Amendment (Discretionary Mutual Funds and Direct Offshore Foreign Insurers) Act 2007 commences first

Insurance Act 1973

39  Subsection 3(1) (note to the definition of insurance business )

Omit “Particular contracts of insurance, or kinds of contracts of insurance,”, substitute “Some contracts of insurance”.

40  Section 3A

Repeal the section, substitute:

3A   Certain insurance contracts not taken to be insurance business

             (1)  For the purposes of this Act, insurance business does not include undertaking liability under a contract of insurance, or a kind of contract of insurance:

                     (a)  specified in the regulations for the purposes of this subsection; or

                     (b)  in circumstances specified in the regulations for the purposes of this subsection.

             (2)  Without limiting subsection (1), the regulations may specify a contract of insurance, a kind of contract of insurance, or circumstances, by reference to:

                     (a)  particular general insurance products (within the meaning of Chapter 7 of the Corporations Act 2001 ), or particular kinds of such products; or

                     (b)  particular persons, or particular kinds of persons, who are insured under a contract of insurance, or a kind of contract of insurance.

41  Subsection 63(1) (definition of decision maker )

Repeal the definition, substitute:

decision maker , in relation to a reviewable decision, means APRA.

42  Subsection 63(1) (paragraph (a) of the definition of person affected by a reviewable decision )

Repeal the paragraph.

43  Subsection 63(1) (definition of reviewable decision )

Repeal the definition, substitute:

reviewable decision means a decision of APRA that is a decision to which, under this Act, this Part applies.

Division 2—Amendments if Schedule 2 to the Financial Sector Legislation Amendment (Discretionary Mutual Funds and Direct Offshore Foreign Insurers) Act 2007 has not yet commenced

Insurance Act 1973

44  Subsection 63(1)

Insert:

decision maker , in relation to a reviewable decision, means APRA.

45  Subsection 63(1)

Insert:

person affected by a reviewable decision , in relation to a reviewable decision of a decision maker, means:

                     (a)  in the case of a determination under subsection 93(3)—Lloyd’s or any Lloyd’s underwriter; or

                     (b)  in any other case—the person in relation to whom the decision was made.

46  Subsection 63(1) (definition of person affected by a reviewable decision of the Treasurer or APRA )

Repeal the definition.

47  Subsection 63(1)

Insert:

reviewable decision means a decision of APRA that is a decision to which, under this Act, this Part applies.

48  Subsection 63(1) (definition of reviewable decision of the Treasurer or APRA )

Repeal the definition.

49  Subsection 63(2)

Omit “of the Treasurer or APRA”.

50  Subsection 63(2)

Omit “Treasurer or APRA, as the case may be,” (wherever occurring), substitute “decision maker”.

51  Subsection 63(4)

Omit “the Treasurer or APRA, as the case may be,”, substitute “the decision maker”.

52  Subsection 63(4)

Omit “Treasurer or APRA” (last occurring), substitute “decision maker”.

53  Subsection 63(5)

Omit “Treasurer or APRA, as the case may be,”, substitute “decision maker”.

54  Subsection 63(5)

Omit “Treasurer or APRA” (second and last occurring), substitute “decision maker”.

55  Subsection 63(6)

Omit “Treasurer or APRA, as the case may be,”, substitute “decision maker”.

56  Subsection 63(6)

Omit “Treasurer or APRA” (second occurring), substitute “decision maker”.

57  Subsection 63(6)

Omit “Treasurer’s or APRA’s” (wherever occurring), substitute “decision maker’s”.

58  Subsection 63(7)

Omit “the Treasurer and decisions of APRA”, substitute “a decision maker”.

59  Subsections 63(9), (12) and (13)

Omit “of the Treasurer or APRA”.

60  Subsection 64(1)

Omit “of the Treasurer or APRA”.

61  Paragraph 64(1)(a)

Omit “Treasurer or APRA, as the case may be,”, substitute “decision maker”.

62  Paragraph 64(1)(b)

Omit “Treasurer or APRA”, substitute “decision maker”.

63  Subsection 64(2)

Omit “the Treasurer or APRA”, substitute “a decision maker”.

64  At the end of section 64

Add:

             (4)  In this section:

decision maker has the meaning given by section 63.

Division 3—Amendments once Schedule 2 to the Financial Sector Legislation Amendment (Discretionary Mutual Funds and Direct Offshore Foreign Insurers) Act 2007 commences

Financial Sector Legislation Amendment (Discretionary Mutual Funds and Direct Offshore Foreign Insurers) Act 2007

65  Item 8 of Schedule 2

Repeal the item, substitute:

8  After section 3

Insert:

3A   Certain insurance contracts not taken to be insurance business

             (1)  For the purposes of this Act, insurance business does not include undertaking liability under a contract of insurance, or a kind of contract of insurance:

                     (a)  specified in the regulations for the purposes of this subsection; or

                     (b)  in circumstances specified in the regulations for the purposes of this subsection.

             (2)  Without limiting subsection (1), the regulations may specify a contract of insurance, a kind of contract of insurance, or circumstances, by reference to:

                     (a)  particular general insurance products (within the meaning of Chapter 7 of the Corporations Act 2001 ), or particular kinds of such products; or

                     (b)  particular persons, or particular kinds of persons, who are insured under a contract of insurance, or a kind of contract of insurance.

66  Items 13 to 33 of Schedule 2

Repeal the items.

Insurance Act 1973

67  Subsection 3(1) (note to the definition of insurance business )

Omit “Particular contracts of insurance, or kinds of contracts of insurance,”, substitute “Some contracts of insurance”.