From 1 July 2018, ASIC will be able to charge fees for its services which include regulatory costs that are directly attributable to a single, identifiable entity.
Below are some examples of the Fee-for-Service Activities and the affected areas:
|Activity||Affected Sector||Current Fee||Proposed Fee|
|Licence Applications||Credit Licensees||$1,160||$2,055 (Credit Assistance Providers)
$4,624 (Credit Providers)
|AFS Licensees||$1,643||Retail: $3,721 - $7,537
Wholesale: $2,233 - $5,000
(depending on complexity of authorisations)
|Variation Applications||Credit Licensees||$115||$1,284 (Credit Assistance Providers)
$2,826 (Credit Providers)
|AFS Licensees||$274||Retail: $2,233 - $3,210
Wholesale: $1,364 - $3,071
(depending on complexity of authorisations)
|Applications for Relief||All Sectors||$1,169||$3,487 (standard applications)|
Currently, the fees associated with these activities do not reflect the costs to ASIC of undertaking these activities. Traditionally, many of these activities have only attracted a nominal fee, which has not been subject to any review resulting in these costs being paid by taxpayers.
In preparation for the 1 July 2018 commencement, the Australian government opened consultation on the next phase of the Model and asked for feedback specifically in relation to the Fee-for-Service full cost recovery. Public consultation on the proposed Fees-for-Service closed on 15 December 2017.
The key dates to be aware of this year include:
- March 2018: ASIC to consult on Strategic Risks.
- March 2018: ASIC intends to publish indicative levies for FY17-18 for approximately 80% of regulated entities based on FY17-18 budget data.
- June 2018: ASIC intends to publish indicative levies for FY18-19 for approximately 80% of regulated entities based on FY18-19 budget data.
- 1 July 2018: New Fee-for-Service charges commence (subject to legislation).
- 1 July 2018: Annual Review Fees increase by approximately $5 for all proprietary companies.
- July – Sept 2018: Regulated Entities submit a return about their operations for FY17-18.
- October 2018: Budget FY18-19 leviable costs by subsector published in Cost Recovery Implementation Statement.
The Industry funding legislation was passed on 15 June 2017, with the Regulations finalised on 27 June 2017. The new regime came into effect on 1 July 2017. The Australian Government previously consulted on the Model in 2015 and 2016, as discussed in our previous blog article “Industry Funding Model for ASIC Moving Closer” published in February last year.
As a result of both the previous consultations, the revised Model outlined in the November 2017 Consultation Paper titled “Introduction of Australian Securities and Investments Commission’s Fees-for-Service Under the Industry Funding Model” included enhancements to reflect feedback from the 2016 consultation paper including:
- the introduction of a tiered fee system for many activities so that the amount of the fee more accurately reflected the complexity of the activity; and
- the removal of fees for novel relief applications recognising the industry-benefits that often result from these activities.
Stakeholder feedback from the 2016 consultation supported the principle that a fee should be paid for ASIC’s demand-driven services, such as processing a licence or registration application, provided that the fee directly represents the efficient costs of providing the regulatory activity or service.
To address the feedback received, the implementation of the revised Fee-for-Service proposal was delayed allowing time to refine the Model by gathering further data to support the pricing, in particular through time recording. Existing fees in the Corporation (Fees) Act 2001 and Corporations (Fees) Regulations 2001 would continue to apply from the commencement of the Model on 1 July 2017 until the new Fee-for-Service schedule is introduced this July.
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