Treasury Laws Amendment (Strengthening Corporate and Financial Sector Penalties) Act 2019 (17 of 2019)
Schedule 1 Amendment of the Corporations Act 2001
Part 1 Amendments
Corporations Act 2001
117 Section 1317G
Repeal the section, substitute:
1317G Pecuniary penalty orders
Court may order person to pay pecuniary penalty
(1) A Court may order a person to pay to the Commonwealth a pecuniary penalty in relation to the contravention of a civil penalty provision if:
(a) a declaration of contravention of the civil penalty provision by the person has been made under section 1317E; and
(b) if the contravention is of a corporation/scheme civil penalty provision, the contravention:
(i) materially prejudices the interests of the corporation, scheme or fund, or its members; or
(ii) materially prejudices the corporation's ability to pay its creditors; or
(iii) is serious; and
(c) if the contravention is of a financial services civil penalty provision that is not a Part 7.7A civil penalty provision, the contravention:
(i) materially prejudices the interests of acquirers or disposers of the relevant financial products; or
(ii) materially prejudices the issuer of the relevant financial products or, if the issuer is a corporation, scheme or fund, the members of that corporation, scheme or fund; or
(iii) is serious; and
(d) if the contravention is of subsection 1211B(1) or (2) (complying with the Passport Rules for this jurisdiction), the contravention:
(i) materially prejudices the interests of the passport fund or its members; or
(ii) is serious.
The order is a pecuniary penalty order .
Maximum pecuniary penalty
(2) The pecuniary penalty must not exceed the pecuniary penalty applicable to the contravention of the civil penalty provision.
Pecuniary penalty applicable to the contravention of a civil penalty provision - by an individual
(3) The pecuniary penalty applicable to the contravention of a civil penalty provision by an individual is the greater of:
(a) 5,000 penalty units; and
(b) if the Court can determine the benefit derived and detriment avoided because of the contravention - that amount multiplied by 3.
Pecuniary penalty applicable to the contravention of a civil penalty provision - by a body corporate
(4) The pecuniary penalty applicable to the contravention of a civil penalty provision by a body corporate is the greatest of:
(a) 50,000 penalty units; and
(b) if the Court can determine the benefit derived and detriment avoided because of the contravention - that amount multiplied by 3; and
(c) either:
(i) 10% of the annual turnover of the body corporate for the 12-month period ending at the end of the month in which the body corporate contravened, or began to contravene, the civil penalty provision; or
(ii) if the amount worked out under subparagraph (i) is greater than an amount equal to 2.5 million penalty units - 2.5 million penalty units.
Contrary intention in relation to pecuniary penalty applicable
(5) Subsections (3) and (4) apply in relation to a contravention of a civil penalty provision by an individual or a body corporate unless there is a contrary intention under this Act in relation to the pecuniary penalty applicable to the contravention. In that case, the pecuniary penalty applicable is the penalty specified for the civil penalty provision.
Determining pecuniary penalty
(6) In determining the pecuniary penalty, the Court must take into account all relevant matters, including:
(a) the nature and extent of the contravention; and
(b) the nature and extent of any loss or damage suffered because of the contravention; and
(c) the circumstances in which the contravention took place; and
(d) whether the person has previously been found by a court (including a court in foreign country) to have engaged in similar conduct.
1317GAA Civil enforcement of pecuniary penalty order
(1) A pecuniary penalty is a debt payable to ASIC on behalf of the Commonwealth.
(2) ASIC or the Commonwealth may enforce a pecuniary penalty order as if it were an order made in civil proceedings against the person to recover a debt due by the person. The debt arising from the order is taken to be a judgment debt.
1317GAB Relinquishing the benefit derived and detriment avoided from contravening a civil penalty provision
Relinquishment order
(1) A Court may order a person to pay the Commonwealth an amount equal to the benefit derived and detriment avoided because of a contravention of a civil penalty provision if a declaration of contravention by the person has been made under section 1317E. The order is a relinquishment order .
(2) The Court may make a relinquishment order:
(a) on its own initiative, during proceedings before the Court; or
(b) on application by ASIC, made within 6 years after the alleged contravention.
Relationship between relinquishment orders and pecuniary penalty orders
(3) To avoid doubt, the Court may make a relinquishment order in relation to the contravention of a civil penalty provision even if a pecuniary penalty order could be, or has been, made in relation to the contravention of the civil penalty provision.
Note: The relationship between relinquishment orders and proceedings for an offence are dealt with in sections 1317M, 1317N, 1317P and 1317Q.
1317GAC Civil enforcement of relinquishment order
(1) The amount payable under a relinquishment order is a debt payable to ASIC on behalf of the Commonwealth.
(2) ASIC or the Commonwealth may enforce a relinquishment order as if it were an order made in civil proceedings against the person to recover a debt due by the person. The debt arising from the order is taken to be a judgment debt.
1317GAD Meaning of benefit derived and detriment avoided because of a contravention of a civil penalty provision
The benefit derived and detriment avoided because of a contravention of a civil penalty provision is the sum of:
(a) the total value of all benefits obtained by one or more persons that are reasonably attributable to the contravention; and
(b) the total value of all detriments avoided by one or more persons that are reasonably attributable to the contravention.