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CORPORATIONS ACT 2001 - SECT 912D

Obligation to notify ASIC of certain matters

             (1)  A financial services licensee must comply with subsection (1B) if:

                     (a)  the licensee breaches, or is likely to breach:

                              (i)  any of the obligations under section 912A or 912B, other than the obligation under paragraph 912A(1)(c); or

                             (ii)  the obligation under paragraph 912A(1)(c), so far as it relates to provisions of this Act or the ASIC Act referred to in paragraphs (a), (b) and (c) of the definition of financial services law in section 761A; or

                            (iii)  in relation to financial services, other than traditional trustee company services provided by a licensed trustee company-- the obligation under paragraph 912A(1)(c), so far as it relates to Commonwealth legislation that is covered by paragraph (d) of that definition and that is specified in regulations made for the purposes of this subparagraph; or

                            (iv)  in relation to traditional trustee company services provided by a licensed trustee company--the obligation under paragraph 912A(1)(c), so far as it relates to Commonwealth, State or Territory legislation, or a rule of common law or equity, that is covered by paragraph (d) or (e) of that definition; and

                     (b)  the breach, or likely breach, is significant, having regard to the following:

                              (i)  the number or frequency of similar previous breaches;

                             (ii)  the impact of the breach or likely breach on the licensee's ability to provide the financial services covered by the licence;

                            (iii)  the extent to which the breach or likely breach indicates that the licensee's arrangements to ensure compliance with those obligations is inadequate;

                            (iv)  the actual or potential financial loss to clients of the licensee, or the licensee itself, arising from the breach or likely breach;

                             (v)  any other matters prescribed by regulations made for the purposes of this paragraph.

          (1A)  For the purposes of subsection (1), a financial services licensee is likely to breach an obligation referred to in that subsection if, and only if, the person is no longer able to comply with the obligation.

          (1B)  The financial services licensee must, as soon as practicable and in any case within 10 business days after becoming aware of the breach or likely breach mentioned in subsection (1), lodge a written report on the matter with ASIC.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

          (1C)  A report that a licensee is required to lodge under subsection (1B) is taken to have been lodged with ASIC if:

                     (a)  the licensee is a body regulated by APRA; and

                     (b)  the report is received by APRA in accordance with the terms of an agreement between APRA and ASIC under which APRA is to act as ASIC's agent in relation to such reports.

          (1D)  Subsection (1B) does not apply to a financial services licensee that is a body regulated by APRA in relation to a breach if:

                     (a)  the auditor or actuary of the licensee gives APRA a written report about the breach; and

                     (b)  the report is given before, or within 10 business days after, the licensee becomes aware of the breach.

             (2)  A financial services licensee must give written notice to ASIC, as soon as practicable, if the licensee becomes a participant in a licensed market or a licensed CS facility, or ceases to be such a participant. The notice must say when this happened and identify the market or facility.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).



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