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The Department of Home Affairs has issued its draft guidance “Modern Slavery Act 2018: Draft Guidance for Reporting Entities” (Draft Guidance) for the new Modern Slavery Act 2018 (Cth) (the Act).
Welcome to Edition 43 of Boardroom Brief.
This is a service specifically targeted at the needs of busy non-executive directors. We aim to give you a “heads up” on the things that matter for NEDs in the week ahead – all in two minutes or less.
Treasury consults on implementing the OECD Hybrid Mismatch Rules. Directors involved in international business will no doubt be aware that the Commonwealth Government is pursuing a range of integrity measures designed to clamp down on international tax arbitrage arrangements. The latest measure is an exposure draftlegislation and accompanying explanatory memorandum to implement the recommendations of the 2015 OECD report - Neutralising the Effects of Hybrid Mismatch Arrangements. Broadly, these rules are designed to prevent any double non-taxation benefits by either denying deductions or including amounts in assessable income. The draft legislation will apply to related parties, members of a control group and structured arrangements. Submissions are due by 22 December 2017. For further information see Treasury’s website. See also Treasurer of Commonwealth of Australia, the Hon Scott Morrison’s media release.
Dubai and Australia seal agreement on fintech cooperation. The Dubai Financial Services Authority (DFSA) and ASIC have signed a Cooperation Agreement which provides a framework for cooperation to support and understand financial innovation in each jurisdiction. This Agreement will enable the DFSA and ASIC to refer innovative fintech businesses to each other for support provided through their respective fintech functions. See ASIC’s media release.
Treasury consults on introduction of ASIC’s fees-for-service under the Industry Funding Model. The Government has released Consultation Paper to deliver on its commitment to introduce an industry funding model for the ASIC, with the model’s Phase 2 Fees-for-service consultation paper released for stakeholder feedback. Under the ASIC Industry Funding Model, from 1 July 2018 fees-for-service will be introduced to recover ASIC regulatory costs that are directly attributable to a single, identifiable, entity. These fees are imposed under the Corporations (Fees) Act 2001 and specified in the Corporations (Fees) Regulations 2001. Fees associated with registry activities are excluded from the scope of this proposal. In preparation for the 1 July 2018 fees-for-service full cost recovery, the Australian Government seeks stakeholder feedback on three areas associated with the implementation and operation of the model: proposed fees-for-service model; methods of ASIC stakeholder engagement and accountability; and competition and innovation aspects. Submissions are due on 15 December 2017. For further information see Treasury’s website. See also Minister for Revenue and Financial Services, the Hon Kelly O’Dwyer’s media release and ASIC’s media release.
China to “substantially” reduce barriers. Following the 19th National Congress of the Communist Party of China and the meeting between Chinese President Xi Jinping and US President Donald Trump, President Xi has provided assurances that China would become increasingly open and transparent in dealing with foreign firms and China’s “One Belt, One Road” project. Specifically, the Chinese Foreign Ministry confirmed that China will “substantially” reduce barriers, including in the banking, insurance and finance sectors. Under this framework, foreign direct investment (FDI) into any industry not listed in the “Negative List” only requires an online record filing, as opposed to prior approval on a case-by-case basis. While Australian politicians grapple with the national security and diplomatic issues involved in the “One Belt One Road” initiative, Directors of companies with expertise in relation to technology, digital innovation, services, investments (in particular in financial services and capital markets where Australia rightfully has a strong reputation) should actively consider the opportunities that initiative may bring, particularly where China offers FDI concessions to encourage participation.
Citizenship Redux. Mark 5pm on December 1 in the diary. This is the time and date the Turnbull government has agreed with Labor for the making of citizenship disclosure. MPs are required to specify circumstances of their birth, and of their parents and grandparents to the best of their belief. If they are dual citizens (or potential dual citizens by descent), they will need to provide proof they have renounced that citizenship prior to taking office. We could be heading into a Christmas break with the very real prospect of a forced general election some time in 2018.