TRUSTEE COMPANIES (TRANSFERS) AMENDMENT BILL

Second Reading

Adjourned debate on second reading.

(Continued from 1 November 2012.)

The Hon. S.G. WADE (17:33): I rise on behalf of the Liberal opposition to indicate our support for the Trustee Companies (Transfers) Amendment Bill 2012. On 17 October Attorney-General Rau introduced the bill in the House of Assembly. The bill is considered to be consequential to the changes made in the Trustee Companies (Commonwealth Regulation) Amendment Bill 2010 as part of national efforts to create consistent regulation of trustee companies and remove the duplication of state, territory and federal licensing.

The Liberal opposition supported the Trustee Companies (Commonwealth Regulation) Amendment Bill 2010. A trustee company is a company incorporated under the Commonwealth Corporations Act 2001 and authorised under state and territory legislation to perform personal trustee and deceased estate administration services. In June 2008 the Council of Australian Governments agreed that the commonwealth government would assume responsibility for regulating trustee companies at the entity level. This commitment is one of 27 reforms agreed to under the national partnership agreement to deliver a seamless national economy.

Public trustees were not to be subject to the new regulatory regime unless the government consented to this occurring. In 2010, the Liberal opposition were informed that the government did not intend to give that consent. In April 2011, amended provisions of the commonwealth Corporations Act came into effect, providing for the voluntary transfer of trustee business between the companies.

The commonwealth government has advised that South Australian legislation must be amended to operate as required by the April 2011 commonwealth law amendments. The government did not make clear which of the certain conditions are not met by the current Trustee Companies Act. The 2010 act provides for a transitional period during which trustee companies which do not already have an Australian financial services licence will be deemed to hold one until the end of the transitional period.

The transitional period ends on 31 December 2012. Unless the South Australian legislation is amended by that date, companies will be unable to apply for a transfer determination to change from the deemed licence to an ongoing one. The provisions for this transfer are proposed to go in the Trustee Companies Act rather than the supporting regulations, so that both the compulsory and voluntary transfers are contained within the same act.

Despite the commonwealth legislation passing over 18 months ago, the commonwealth has waited until two months before the transitional deadline to introduce the legislative change. If the legislation passes in the next two sitting weeks, trustee businesses that are operating on a deemed licence only have six weeks to apply for and receive an Australian financial services licence. The Liberal opposition supports the bill but regrets the tardiness of the government in introducing and progressing it.

Debate adjourned on motion of Hon. G.A. Kandelaars.