82Reserve Bank’s directions power—directions to increase compliance, reduce risks or enhance resolvability

82 Reserve Bank’s directions power—directions to increase compliance, reduce risks or enhance resolvability

(1) The Reserve Bank may, by written notice given to a body corporate, direct the body corporate (the directed body) to take specified action mentioned in subsection (2) or (3) if the body corporate:

(a) is a designated entity; or

(b) is a related body corporate of a designated entity and is incorporated in Australia.

Note: A decision to give a direction under this subsection is a reviewable decision (see Division 2 of Part 10).

(2) If the directed body is a designated entity, the action required by the direction (which may include action to do an act or thing, or refrain from doing an act or thing) may be:

(a) specified action that the Reserve Bank reasonably believes will promote compliance by the directed body with its obligations under Division 2 of this Part, or Division 4 of Part 8, if the Reserve Bank reasonably believes that the directed body is not complying or is not likely to comply with those obligations; or

(b) specified action to reduce risks to the continued provision of the directed body’s cash distribution services, if the Reserve Bank reasonably believes that the directed body has not done, or is unlikely to do, all things reasonably practicable to minimise those risks.

(3) Whether the directed body is a designated entity or a related body corporate of a designated entity, the action required by the direction (which may include action to do an act or thing, or refrain from doing an act or thing) may be:

(a) specified action to comply with all or part of one or more standards in force under Division 3, if the Reserve Bank reasonably believes that the directed body is not complying with those standards or parts; or

(b) specified action to manage or resolve an impediment to the effective management of or response to a condition in section 90 being satisfied in relation to:

(i) the directed body; or

(ii) the directed body’s cash distribution services; or

(iii) the cash distribution services of a related body corporate, of the directed body, that is incorporated in Australia;

if the Reserve Bank reasonably believes that the directed body has not done, or is unlikely to do, all things reasonably practicable to manage or resolve the impediment.

(4) The direction must specify a reasonable time by which, or a reasonable period during which, it is to be complied with.

Complying with directions

(5) A body corporate contravenes this subsection if:

(a) the body corporate is given a direction under subsection (1); and

(b) the body corporate fails to comply with the direction.