ASIC is The Australian Securities and Investments Commission that operates as an independent Australian government body with the mission of regulating corporations within Australia and enforcing certain laws.
The essential function of the ASIC is to enforce laws pertaining to and oversee the regulation of companies in the financial, insurance and credit services sectors in order to safeguard Australian investors, consumers and creditors.
Australia’s first attempt at creating an organization like ASIC was with the Australian Securities Commission or ASC that was formed on January 1st, 1991 after the passage of the ASC Act in 1989. The ASC was intended to bring together Australia’s corporate regulators by replacing the previous National Companies and Securities Commission, as well as the Corporate Affairs offices that were then operating in Australia’s states and territories.
The Wallis report or inquiry into the Australian financial system produced 115 recommendations for change that included having a single agency responsible for enforcing corporation law, maintaining market integrity and protecting consumers.
As a result, the ASIC was formed in July 1998 to take over all of the ASC’s former responsibilities. The ASIC also gained a wider role than the ASC by becoming responsible for protecting consumers in the insurance, deposit and superannuation industries. On that same date, the Australian Prudential Regulation Authority or APRA took over as the prudential supervisor of the financial services industry in Australia.
Location and Jurisdiction
From its headquarters in Sydney, New South Wales, the ASIC primarily oversees corporate and finance industry activity, and its operational jurisdiction is situated within the borders of the Commonwealth of Australia. The ASIC’s official website is located at http://www.asic.gov.au/.
The ASIC bases its enforcement authority primarily on the Australian Securities and Investments Commission Act of 2001, which is also known as the ASIC Act, and most of its work is performed under the authority of the Corporations Act of 2001.
The ASIC also started assuming responsibility for enforcing laws within the credit sector in 2002, and it obtained authority for overseeing the Australian Stock Exchange in 2009. Most recently, the ASIC gained oversight responsibility for Chi-X, which is an equity exchange operator, in 2011.
In terms of specific legislation that the ASIC enforces and administers, it is responsible for the implementation of either a portion or all of the following legislative actions: The Corporations Act of 2001; The Insurance Contracts Act of 1984 and The National Consumer Credit Protection Act of 2009.
According to its official website, The Australian Securities and Investments Commission Act of 2001 requires ASIC to do the following six things:
- Maintain, assist and improve the financial system’s performance and that of entities within it.
- Promote informed and confident participation in the financial system by consumers and investors.
- Administer the Australian law effectively and with the minimum of procedural requirements.
- Give effect to and enforce the law.
- Receive, store and process in an efficient and speedy manner the information that it receives.
- Make information about firms and other bodies readily available to members of the public as soon as is practical.
ASIC in the News
ASIC and APRA signed a memorandum of understanding to create a framework for cooperating in areas of mutual interest on May 18th, 2010:
Below is a list of brokers that are ASIC regulated