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ASIC has updated legislation surrounding time-sharing schemes, remaking the class orders due to expire on 1 April 2017 and 1 October 2017.
ASIC said the new instrument follows a public consultation in November 2016.
"In Consultation Paper 272 Remaking ASIC Class Orders on time-sharing schemes (CP 272), ASIC sought feedback in relation to our review of [CO 00/2460], [CO 02/237], [CO 02/315] and [CO 03/104] and our proposals in relation to the current policy settings for time-sharing schemes," ASIC said.
"The new legislation, ASIC Corporations (Time-sharing Schemes) Instrument 2017/272 is now a single new instrument [CO 00/2460] Time-sharing schemes—property valuations, [CO 02/315] Time-sharing schemes—use of loose-leaf price list and [CO 03/104] Relief facilitating the acquisition and sale of forfeited interests in registered time-sharing schemes without substantive change; and provides transitional relief for existing operators relying on [CO 02/237] Time-sharing schemes—operation of rental pool.
"We received eight submissions in response to CP 272. The submissions generally supported our proposals to continue the relief under [CO 00/2460], [CO 02/315] and [CO 03/104].
We also received feedback that supported our proposal to provide transitional relief to existing operators relying on [CO 02/237] and to consider any new applications for similar relief on a case-by-case basis.
"However, we received divergent feedback on many proposals in CP 272, such as the introduction of a new oral advice requirement and new fee disclosure regime.
An area of significant contention was the current cooling-off regime and whether changes are required to the timeframe of the cooling-off periods or the opt-out model.
"In light of the divergent feedback receivedand the upcoming sunsetting deadline of 1 April 2017 for most of the time-sharing class orders, we have decided on a phased approach to our review of the current policy settings for time-sharing schemes.
This approach will allow us to provide certainty to operators and customers of time-sharing schemes while we undertake further consultation to ensure proposals to change the current policy settings are given proper consideration."
Phase 1 – Release of the new instrument
"As phase one, we have released the new legislative instrument, which remakes the sunsetting time-sharing class orders [CO 00/2460], [CO 02/237] and [CO 03/104] in substantially the same form and provides transitional relief to existing operators relying on [CO 02/237] by the sunsetting deadline of 1 April 2017," ASIC said.
"This will maintain the status quo while we undertake further consultation on proposals outlined in CP 272. We will consider any more substantive changes that are required to the relief as part of our work in phase two.
"A feedback report on responses to CP 272 will also be released shortly."
Phase 2 - Our more substantive changes
"Phase two will involve the implementation of our more substantive changes to the current policy settings,after we have undertakenfurther consultation on the feedback received in response to CP 272. In April 2017, we will be contacting parties who provided responses to CP 272 to discuss their feedback," ASIC said.
Under the Legislation Act 2003, all class orders sunset after a specified period of time (mostly ten years) unless we take action to exempt or preserve them. This ensures that legislative instruments like class orders are kept up to date and only remain in force while they are fit for purpose and relevant.
All government organisations are responsible for considering whether the legislative instruments they have made that are due to sunset will be relevant after their sunset date.
The new legislation is available here <a href="https://www.legislation.gov.au/current/F2017L00315" target="_blank">ASIC Corporations (Time-sharing Schemes) Instrument 2017/272</a>.
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