Financial Sector Legislation Amendment (Review of Prudential Decisions) Act 2008 (25 of 2008)

Schedule 1   Court power of disqualification etc.

Part 1   Amendments commencing on Royal Assent

Banking Act 1959

7   Sections 21 and 22

Repeal the sections, substitute:

21 Court power of disqualification

(1) On application by APRA, the Federal Court of Australia may, by order, disqualify a person from being or acting as a person referred to in subsection (2), for a period that the Court considers appropriate, if the Court is satisfied that:

(a) the person is not a fit and proper person to be or act as such a person; and

(b) the disqualification is justified.

(2) For the purposes of subsection (1), the Court may disqualify a person from being or acting as one or more of the following:

(a) a director or senior manager of:

(i) a particular ADI; or

(ii) a class of ADIs; or

(iii) any ADI;

(other than a particular foreign ADI, a class of foreign ADIs or any foreign ADI);

(b) a senior manager of the Australian operations of:

(i) a particular foreign ADI; or

(ii) a class of foreign ADIs; or

(iii) any foreign ADI;

(c) a director or senior manager of:

(i) a particular authorised NOHC; or

(ii) a class of authorised NOHCs; or

(iii) any authorised NOHC;

(d) an auditor of:

(i) a particular ADI or a particular authorised NOHC; or

(ii) a class of ADIs or a class of authorised NOHCs; or

(iii) any ADI or any authorised NOHC.

(3) In deciding whether it is satisfied as mentioned in paragraph (1)(a), the Court may take into account:

(a) any matters specified in the regulations for the purposes of this paragraph; and

(b) any criteria for fitness and propriety set out in the prudential standards; and

(c) any other matters the Court considers relevant.

(4) In deciding whether the disqualification is justified as mentioned in paragraph (1)(b), the Court may have regard to:

(a) if the application is for the person to be disqualified from being or acting as a director or senior manager - the person's conduct in relation to the management, business or property of any corporation; and

(b) if the application is for the person to be disqualified from being or acting as an auditor - the person's conduct in relation to the functions or duties of the person as required under this Act and the prudential standards; and

(c) in any case - any other matters the Court considers relevant.

(5) As soon as practicable after the Court disqualifies a person under this section, APRA must cause particulars of the disqualification:

(a) to be given:

(i) if the person is, or is acting as, a person referred to in subparagraph (2)(a)(i) - to the ADI concerned; or

(ii) if the person is, or is acting as, a person referred to in subparagraph (2)(b)(i) - to the foreign ADI concerned; or

(iii) if the person is, or is acting as, a person referred to in subparagraph (2)(c)(i) - to the authorised NOHC concerned; or

(iv) if the person is, or is acting as, a person referred to in subparagraph (2)(d)(i) - to the ADI or authorised NOHC concerned; and

(b) to be published in the Gazette.

22 Court power to revoke or vary a disqualification etc.

(1) A disqualified person, or APRA, may apply to the Federal Court of Australia for:

(a) if the person is a disqualified person only because he or she was disqualified under section 21 - a variation or a revocation of the order made under that section; or

(b) otherwise - an order that the person is not a disqualified person.

(2) If the Court revokes an order under paragraph (1)(a) or makes an order under paragraph (1)(b), then, despite section 20, the person is not a disqualified person .

(3) At least 21 days before commencing the proceedings, written notice of the application must be lodged:

(a) if the disqualified person makes the application - by the person with APRA; or

(b) if APRA makes the application - by APRA with the disqualified person.

(4) An order under paragraph (1)(b) may be expressed to be subject to exceptions and conditions determined by the Court.