Organizations as well as individuals regulated by the Australian Securities and Investments Commission have until September 27 to provide industry funding contact details and submit business activity metrics to the regulator. ASIC issued letters to each company back in July which outlined the process of filing this information in detail. The letter also indicated that the deadline for following the directives would be September 27. In case any organization or individual misses the deadline, they will be penalized. Those who didn’t receive the letter but fall under ASIC’s regulation will also be able to follow suit.
The steps to follow when filing the information
There are exemptions made for certain types of organizations. Charity organizations are not required to file the industry funding contact details or the business activities metrics as the government will absorb the costs of regulating these charities. This is also true for the organizations that fall under the regulation of the Australian Charities and Not For Profits Commission. In addition, small proprietary companies that don’t operate in a financial services industry sector regulated by ASIC are also not required to visit the portal.
For those companies that received a letter from ASIC the procedure is fairly simple. They just have to follow the steps outlined in the letter. First, they have to go to the regulator’s portal and register using the industry funding security key. After they follow these steps, they will be allowed to log in and submit their industry funding contact details as well as business activity metrics. Others, who might not have received the letters, can use their corporate key or ASIC key to log in on the portal and submit their respective information. During the registration, such users will simply have to indicate ‘I want to connect to a licence or registration I hold’ or the ‘I want to act on behalf of a registered company or body’. If the company has neither the corporate key nor the ASIC key, they can contact the regulator directly and request the letter.
Some companies have already completed the necessary steps. Cathie Armour, ASIC Commissioner thanked them with a statement: “We are all settling in to this new funding model and your attention and time toward completing the process is appreciated. The deadline is a few days away and we are urging the rest of our industry stakeholders to act now and complete the process online.” “The information you provide will enable ASIC to calculate your share of the regulatory costs for the sector in which you operate. Your invoice will be issued in January 2019,” – states the organization’s website.
What is industry funding?
With industry funding, ASIC wants to recover its regulatory costs from the companies regulated by it. This is achieved by a combination of fees for provided services as well as levies. The regulator estimates that approximately 10% of the total costs will be recouped using fees-for-service and 90% will be collected from levies. In order to collect these levies, ASIC has divided the companies into six sectors and 48 subsectors. Fees-for-service will be collected from individual companies when they receive a particular service from ASIC which can be licensing, professional registrations, applications for relief and review of corporate finance transaction documents. Although there are charges associated with these services already, the regulators believe that they don’t reflect the true costs.
The process of collecting levies is less straightforward. Depending on the subsector, some companies might be required to pay a flat levy, which means that the cost of regulation will be divided equally among the companies in that subsector. Others might have to pay a graduated levy, in which case certain metrics are going to be considered when determining the size of the levy. These metrics are going to be filed by the company as well and will include information on the number of messages and transactions, total transaction value, whether the gross revenue is above $1 million or not and the number of people engaged in OTC trading activities.