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20-170MR ASIC consults on remaking class order on notification requirements for unlicensed carried over instrument lenders and clarification of credit disclosure obligations
ASIC today released a consultation paper (CP 331) proposing to remake two class orders that are due to expire (‘sunset’) on 1 October 2020 and 1 April 2021.
The class orders proposed to be remade are:
- Class Order [CO 10/381] Notice lodgment requirements for certain persons who are credit providers or lessors in relation to a carried over instrument; and
- Class Order [CO 10/1230] Clarification of credit disclosure obligations – including commencement.
ASIC proposes to preserve the effect of these class orders because it has reached the preliminary view that they continue to form a useful part of the legislative framework. No substantive changes are proposed.
Consultation Paper 331 Remaking ASIC class orders on unlicensed carried over instrument lenders: [CO 10/381] and clarifying credit disclosure obligations: [CO 10/1230] (CP 331) outlines the background to the class orders that we propose to remake and our rationale for remaking them.
The proposed new instruments will be drafted using ASIC’s current style and format, while preserving the current effect of [CO 10/381] and [CO 10/1230]. The new instruments will largely replicate the current instruments. The current instruments can be found at www.legislation.gov.au by clicking on the following direct links: [CO 10/381] and [CO 10/1230].
Submissions on CP 331 are due on 20 August 2020.
Under the Legislative Instruments Act 2003, all class orders are repealed automatically or ‘sunset’ after a specified period of time (mostly 10 years) unless we take action to exempt or preserve them. This ensures that legislative instruments like class orders are kept up to date and only remain in force while they are fit for purpose and relevant.
Where an instrument is considered to be operating effectively and efficiently and still serves a regulatory purpose, we will consult on remaking it even if there will be no substantive changes.
The instrument replacing [CO 10/381] will replicate the obligation in this class order which requires unlicensed carried over instrument lenders (UCOILs) to notify ASIC of their UCOIL status and provide the specific information. ASIC is required to publish and maintain a public register of UCOILs.
The instrument replacing [CO 10/1230] will largely replicate this class order which clarifies credit disclosure obligations for credit licensees. The instrument permits credit licensees and representatives to give a disclosure document to a consumer electronically, provided that certain conditions are met.