Commonwealth Numbered Regulations - Explanatory Statements

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Statutory Rules 2001 No. 208

Issued by the authority of the Minister for Financial Services and Regulation

Corporations Act 2001

Corporations Amendment Regulations 2001 (No. 2)

Section 1364 of the Corporations Act 2001 (the Act) empowers the Governor General to make regulations, not inconsistent with the Act, prescribing matters required or permitted by the Act to be prescribed by regulations, or necessary or convenient to be prescribed by regulations for carrying out of giving effect to the Corporations Law.

Section 1258 of the Act limits the way in which a futures broker can deal in futures contracts on behalf of another person. Dealing on behalf of another person on a 'recognised futures exchange' is permitted by section 1258. The term 'recognised futures exchange' is defined in section 9 of the Act to mean a body corporate that conducts a futures market outside Australia and is prescribed for the purposes of this definition. By virtue of Corporations Regulation 8.2.02, the bodies corporate specified in Schedule 11 of the Corporations Regulations are prescribed for this purpose.

The Regulations amend Schedule 11 of the Corporations Regulations by including an additional foreign futures exchange and update the reference to an already recognised foreign futures exchange to reflect a name change in light of its merger with another exchange. The additional foreign futures exchange to be prescribed is Korea Futures Exchange ("KOFEX"). The change in name is from Austrian Options and Futures Exchange (OTOB) to Wiener Borse AG.

The Regulations were first made as amendments to the Corporations Regulations 1990, on 28 June 2001, with effect from 5 July 2001. The Corporations Regulations 1990 have subsequently been remade as the Corporations Regulations 2001 for the purpose of the Corporations Act 2001. However the Corporations Regulations 2001 did not include the amendments of 5 July 2001. The Regulations incorporate the 5 July 2001 amendments.

The Regulations commence on 15 July 2001, coinciding with the commencement of the Corporations Regulations 2001. Despite the Regulations being of a retrospective nature, they do not breach subsection 48(2) of the Acts Interpretation Act 1901 (the AIA). By making the Regulations retrospective, the persons affected by the Regulations will be advantaged because the Regulations the legal basis of any trading by them on the Korean Futures Exchange and the Wiener Borse AG. Further, subsection 1409(4) of the Act provides that if Regulations are made which deal with transitional matters, as do the current Regulations, then subsection 48(2) of the AIA does not apply.

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