The financial services regulator is calling on all regulated organisations to submit their business metrics via a new portal to help calculate how much they will be charged under new funding arrangements.
As a result of laws passed in June that came into effect last month, those that “create the need for and benefit from ASIC’s regulation will bear the costs”, which will be recovered through levies on regulated entities.
While the Australian government will continue to determine ASIC’s total funding through the annual budget process, for 2017–18, $246.4 million of ASIC’s total budgeted resources of $387.7 million (approximately 64 per cent) will be recovered through levies on the industry.
The industry funding model will recover the actual amount spent during the previous financial year, so levies will only be calculated and issued in the following financial year.
Therefore, regulated entities will need to submit information to ASIC between July and September each year. The first invoices will be issued in January 2019.
According to ASIC’s Cost Recovery Implementation Statement (CRIS), there will be a graduated levy for credit intermediaries (such as mortgage and finance brokers) that is based on the number of credit representatives the entity has as a proportion of the total number of credit representatives in the subsector.
ASIC suggests that there are 4,861 credit licensees and 36,149 credit representatives.
However, ASIC warns that the credit licensee levies are generally cumulative; for example, if a credit licensee holds authorisations as a credit provider and a credit intermediary and provides both small amount credit contracts and regular loans, they are required to pay the levy applicable for all three subsectors.
Each graduated levy is calculated separately and only relates to the licensee’s involvement in that activity or subsector.
In total, ASIC expects that its regulatory work for credit intermediaries will be just over $9 million for 2017–18.
A minimum levy of $1,000 will apply to intermediaries, but there will be no threshold for the graduated levy.
Those paying a graduated levy, such as brokers, will need to provide ASIC with information to confirm the “share” of the leviable activities in their subsector.
ASIC is now calling on businesses to submit their business metrics (or confirm pre-populated business activity metric data) via the ASIC Regulatory Portal so that accurate invoices can be calculated.
These metrics — which cover the previous financial year, and for “credit intermediaries” such as brokers — include the number of credit representatives at 30 June 2018 authorised to engage in specified credit activities (on behalf of the company under its Australian credit licence) and the number of days that the entity was authorised to operate in this area.
ASIC has reminded the industry that letters have already been sent to each regulated company’s registered office address with instruction on how to register on the portal along with an industry funding security key, which can be used to launch an online form.
Those that have not received a letter should contact ASIC’s security key page on its website.
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