EXPLANATORY STATEMENT

 

Select Legislative Instrument 2007 No. 193

 

Issued by the authority of the Parliamentary Secretary to the Treasurer

 

Corporations Act 2001

 

Corporations Amendment Regulations 2007 (No. 2)

 

Subsection 1364(1) of the Corporations Act 2001 (the Act) provides that the Governor‑General may make regulations prescribing matters required or permitted by the Act to be prescribed by regulations, or necessary or convenient to be prescribed by such regulations for carrying out or giving effect to the Act.

 

The Regulations move the disclosure requirements for director and executive remuneration in the accounting standards into regulation 2M.3.03 of the Corporations Regulations 2001. This will allow the requirements to be repealed from the accounting standards. This is aimed at reducing the number of legislative sources that companies are required to make reference to in order to determine their remuneration reporting obligations. The Regulations also repeal existing regulation 2M.6.04 of and the associated Schedule 5B to the Corporations Regulations 2001, as they have been made redundant by amendments to the Corporations Act 2001.

 

Details of the Regulations are set out in the Attachment.

 

Under the Corporations Agreement 2002, the State and Territory Governments referred their constitutional powers with respect to corporate regulation to the Commonwealth. Under subclauses 506(1) and 507(2) of the Corporations Agreement, the Commonwealth is required to consult with and receive the approval of at least 3 State and Territory Ministers of the Ministerial Council for Corporations (the Council) before making a regulation under the national law. The Commonwealth has received approval of the Council for the Regulations. In addition, under subclause 511(3), the Commonwealth is required to consult with the Council as to whether proposed regulations should be exposed for public comment for between one and three months. The Commonwealth has received the approval of the Council to waive the public disclosure period for the Regulations.

 

The Act specifies no other conditions that need to be met before the power to make the Regulations may be exercised.

 

The Regulations would be a legislative instrument for the purposes of the Legislative Instruments Act 2003.

 

The Regulations commence on the day after they are registered.

 

 

Attachment

 

Details of the Corporations Amendment Regulations 2007 (No. 2)

 

Regulation 1 – Name of Regulations

 

This regulation provides that the title of the Regulations is the Corporations Amendment Regulations 2007 (No. 2).

 

Regulation 2 – Commencement

 

This regulation provides for the Regulations to commence on the day after they are registered on the Federal Register of Legislative Instruments.

 

Regulation 3 – Amendment of Corporations Regulations 2001

 

This regulation provides that the Corporations Regulations 2001 (the Principal Regulations) are amended as set out in Schedule 1 and that they apply in relation to a financial year that begins on or after the day on which these Regulations commence.

 

Schedule 1 – Amendment

 

Item [1] – Regulation 2M.3.03

 

These amendments incorporate paragraphs Aus25.2 to Aus25.7.2 from accounting standard AASB 124 Related Party Disclosures into regulation 2M.3.03.

 

Item [2] – Regulation 2M.6.04 and Item [3] – Schedule 5B

 

These amendments repeal regulation 2M.6.04 and the associated Schedule 5B. The requirements in regulation 2M.6.04 and Schedule 5B have been made redundant by the amendments in the Corporations Legislation Amendment (Simpler Regulatory System) Act 2007 and the amendments to regulation 2M.3.03 outlined in item [1].