Senate debates

Thursday, 20 June 2013


Corporations and Financial Sector Legislation Amendment Bill 2013; Second Reading

1:25 pm

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | | Hansard source

The coalition will not oppose the Corporations and Financial Sector Legislation Amendment Bill. Following the global financial crisis the G20 endorsed a global transition of over-the-counter derivatives, which of course are products that are currently traded through bilateral arrangements between two parties. This change recognises exchanges or trading platforms where appropriate in order to boost market transparency. The G20 also agreed that certain trading activities should be cleared through a central counterparty to reduce systemic risk and should be reported to trade repositories in order to enhance market information.

This bill amends various acts in order to assist central counterparties in managing defaults of clearing participants; to improve the allocation of resources by ASIC and the RBA in assessing the compliance of Australian market licence and clearing and settlement facility licence holders with their legal obligations; to allow certain Australian regulators, including the RBA, to exchange protected information with other entities in Australia and overseas in the execution of their duties, subject of course to appropriate safeguards; and to allow ASIC to gather and share protected information with regulatory entities overseas for supervision and enforcement purposes and require ASIC to report on the use of those powers.

The coalition is broadly supportive of the approach taken by the G20 in order to improve the risks associated with the trading of derivatives in light of the issues which have arisen from the global financial crisis. The coalition was supportive of the Corporations Legislation Amendment (Derivative Transactions) Act, which provides the legislative framework to implement Australia's G20 commitments in relation to over-the-counter derivatives reforms, and the coalition will not oppose the passage of this bill either.

1:27 pm

Photo of David FeeneyDavid Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | | Hansard source

I thank Senator Cormann for his contribution and commend the bill to the Senate.

Question agreed to.

Bill read a second time.