On 12 October 2012 the Minister for Infrastructure and Transport announced the Government will sign the Convention on International Interests in Mobile Equipment (the Cape Town Convention) which creates a uniform international legal framework to protect investors in aircraft objects such as passenger airliners, helicopters and aircraft engines. As aircraft objects frequently move across borders, the rights and protection available to creditors may be subject to a variety of international laws. Where a debtor defaults on their loan or lease, creditors will likely have to undertake an exhaustive legal process to repossess their property, possibly involving a number of different jurisdictions. For this reason, creditors generally charge a premium for lending to protect themselves against the substantial risks and uncertainty involved.
Published Impact Analyses
Official website for Published Impact Analyses for decisions announced by the Australian Government, Ministerial Forums and National Standard Setting Bodies.
On 28 September 2012 the Australian Prudential Regulation Authority (APRA) released the final Basel III capital reform package for Australia. The Basel III capital framework was developed through an international agreement between 27 countries. The framework, which was agreed to in December 2010, is intended to raise the quality and level of capital in the global banking system. The capital reform package for Australia represents an incremental change to the Basel II requirements. The main costs will be incurred by financial institutions in meeting the new capital requirements, which are likely to be passed on to bank customers through higher interest rate charges on loans. The main benefits are likely to be realised through maintenance of confidence amongst investors in Australia’s banking system.
On 21 September 2012, the Minister for Employment and Workplace Relations announced plans to amend the Fair Work Act 2009 to extend the existing transfer of business arrangements for transfers between two national system employers to include transfers of business from a state public sector employer (the old employer) to a national system employer (the new employer). The amendment will require a business which is taking over a state government owned business to maintain certain employment conditions. The amendment is considered an extension of the existing arrangements as the Fair Work Act 2009 already requires a business to maintain certain employment conditions when it takes over another business. A Regulation Impact Statement was required for this proposal but the Prime Minister granted an exemption on the basis of exceptional circumstances.
Post-implementation Review – The Treasury
On 13 September 2012, the Government response to the Senate Inquiry report on the regulatory standards for the approval of medical devices in Australia was tabled in the Senate. The Government has agreed in-principle to the development of clinical registers for high risk implantable medical devices. Patients with a high risk implantable medical device that may represent a health risk can be difficult to identify and notify. Development of clinical registers for high risk implantable medical devices could potentially reduce risks to patients’ safety, and costs to patients, industry, health service providers, government and other funders, due to poorly performing devices. A period of investigation is proposed to enable further consultation on the models, scope, governance arrangements and funding mechanisms for registers of high risk medical devices.
On 20 August 2012, the Australian Building Codes Board released a COAG Consultation Regulation Impact Statement (RIS) on a proposal to address the problem of intrusive external noise in new residential buildings. The Consultation RIS examines options to implement proposed standards for new residential construction to address the problem of external noise intruding into the building. The Consultation RIS considers the problem of intrusive noise from major roads and railways. The RIS argues there is evidence that prospective residents may be underestimating the potential harm to their health that continued exposure to noise can cause and they may also be unable to fully assess the noise performance of a building, particularly where they are buying ‘off the plan’.
On 19 September 2012, the Government introduced a bill redesigning a Vocational Education and Training (VET) assistance scheme called VET FEE-HELP. VET FEE-HELP is an Australian Government assistance scheme introduced in 2008 to help vocational education students pay for the upfront costs of study. VET FEE-HELP is similar to other income‑contingent loans schemes offered by the Australian Government, where the student is required to pay back a loan only once their income is above a threshold level. The key elements for improving the VET FEE-HELP scheme that were examined in the Regulation Impact Statement, include:
Annual Regulatory Plans are published by agencies responsible for regulatory changes which may have a significant impact on business. They provide business and the community with information about recent and expected changes to Australian Government regulations, and give information about how to contribute to the development of regulation that is likely to affect them. Agencies are responsible for preparing and publishing their Annual Regulatory Plans. Links to the latest plans are provided below.
On 10 August 2012 the Australian Government released further information about the design features of carbon unit auctions, which will begin in the 2013-14 financial year. From 1 July 2012 to 30 June 2015, the price for each tonne of carbon pollution will be fixed. From 1 July 2015, the carbon pricing mechanism will transition to a ‘cap and trade’ emissions trading scheme and the carbon price will be set by the market. The Australian Government will allocate some carbon units to businesses. The remaining units will be sold at auction.
On 18 September 2012, the Australian Securities and Investments Commission (ASIC) announced the release of industry guidance on new disclosure benchmarks and principles for hedge funds. Hedge funds have a number of characteristics that distinguish them from other managed investment schemes. These include use of leverage, derivatives and short selling. Consequently, investors in hedge funds can be exposed to more complex risks. However, many funds which exhibit the characteristics of hedge funds may not provide sufficient transparency in their product offerings to make investors aware of the nature of these risks.