Trade Practices Amendment (Australian Consumer Law) Act (No. 1) 2010 (44 of 2010)

Schedule 3   Amendment of corporations legislation

Part 2   Pecuniary penalties

Australian Securities and Investments Commission Act 2001

9   After section 12GB

Insert:

12GBA Pecuniary penalties

(1) If the Court is satisfied that a person:

(a) has contravened a provision of Subdivision C, D or GC (other than section 12DA); or

(b) has attempted to contravene such a provision; or

(c) has aided, abetted, counselled or procured a person to contravene such a provision; or

(d) has induced, or attempted to induce, a person, whether by threats or promises or otherwise, to contravene such a provision; or

(e) has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention by a person of such a provision; or

(f) has conspired with others to contravene such a provision;

the Court may order the person to pay to the Commonwealth such pecuniary penalty, in respect of each act or omission by the person to which this section applies, as the Court determines to be appropriate.

(2) In determining the appropriate pecuniary penalty, the Court must have regard to all relevant matters including:

(a) the nature and extent of the act or omission and of any loss or damage suffered as a result of the act or omission; and

(b) the circumstances in which the act or omission took place; and

(c) whether the person has previously been found by the Court in proceedings under this Subdivision to have engaged in any similar conduct.

(3) The pecuniary penalty payable under subsection (1) is not to exceed the number of penalty units worked out using the following table:

(4) If conduct constitutes a contravention of 2 or more provisions referred to in paragraph (1)(a):

(a) a proceeding may be instituted under this Act against a person in relation to the contravention of any one or more of the provisions; but

(b) a person is not liable to more than one pecuniary penalty under this section in respect of the same conduct.

12GBB Pecuniary penalties and offences

(1) The Court must not make an order under section 12GBA against a person in relation to either of the following matters (a consumer protection breach ):

(a) a contravention of a provision referred to in paragraph 12GBA(1)(a);

(b) conduct referred to in paragraph 12GBA(1)(b), (c), (d), (e) or (f) that relates to a contravention of a provision referred to in paragraph 12GBA(1)(a);

if the person has been convicted of an offence constituted by conduct that is substantially the same as the conduct constituting the consumer protection breach.

(2) Proceedings for an order under section 12GBA against a person in relation to a consumer protection breach are stayed if:

(a) criminal proceedings are started or have already been started against the person for an offence; and

(b) the offence is constituted by conduct that is substantially the same as the conduct alleged to constitute the consumer protection breach.

The proceedings for the order may be resumed if the person is not convicted of the offence. Otherwise, the proceedings are dismissed.

(3) Criminal proceedings may be started against a person for conduct that is substantially the same as conduct constituting a consumer protection breach regardless of whether an order under section 12GBA has been made against the person in respect of the breach.

(4) Evidence of information given, or evidence of production of documents, by an individual is not admissible in criminal proceedings against the individual if:

(a) the individual previously gave the evidence or produced the documents in proceedings for an order under section 12GBA against the individual in relation to a consumer protection breach (whether or not the order was made); and

(b) the conduct alleged to constitute the offence is substantially the same as the conduct that was claimed to constitute the consumer protection breach.

However, this does not apply to a criminal proceeding in respect of the falsity of the evidence given by the individual in the proceedings for the order.

12GBC Civil action for recovery of pecuniary penalties

(1) ASIC may institute a proceeding in the Court for the recovery on behalf of the Commonwealth of a pecuniary penalty referred to in section 12GBA.

(2) A proceeding under subsection (1) may be commenced within 6 years after the contravention.

12GBD Indemnification of officers

Officers not to be indemnified

(1) A body corporate (the first body ), or a body corporate related to the first body, must not indemnify a person (whether by agreement or by making a payment and whether directly or through an interposed entity) against any of the following liabilities incurred as an officer of the first body:

(a) a liability to pay a pecuniary penalty under section 12GBA;

(b) legal costs incurred in defending or resisting proceedings in which the person is found to have such a liability.

Penalty: 25 penalty units.

(2) For the purposes of subsection (1), the outcome of proceedings is the outcome of the proceedings and any appeal in relation to the proceedings.

(3) Subsection (1) does not authorise anything that would otherwise be unlawful.

Indemnities are void

(4) Anything that purports to indemnify a person against a liability is void to the extent that it contravenes subsection (1).

Application of this section to a person other than a body corporate

(5) If, as a result of the operation of Part 2.4 of the Criminal Code, a person other than a body corporate is:

(a) convicted of an offence (the relevant offence ) against subsection (1) of this section; or

(b) convicted of an offence (the relevant offence ) against section 11.4 of the Criminal Code in relation to an offence referred to in subsection (1) of this section;

the relevant offence is taken to be punishable on conviction by a fine not exceeding 5 penalty units.