Financial Sector Reform (Savings and Transitional) Regulation 1999

This Regulation (Financial Sector Reform (Savings and Transitional) Regulation 1999) is an interpretive and transitional instrument that remaps references in a range of New South Wales Acts and statutory instruments from older state financial-institution terminology onto the post-reform terminology created by federal financial-sector reform.

Mechanically, the Regulation:

• Commences on the “transfer date” (the date fixed under the Commonwealth Financial Sector Reform (Amendments and Transitional Provisions) Act (No. 1) 1999), which is recorded in the editorial note as 1 July 1999 (s 2).
• States that explanatory material and notes in the text do not form part of the Regulation (s 3).
• Provides two short substantive definitions: “authorised building society” and “authorised credit union”, each meaning a body corporate that holds a consent under section 66 of the Commonwealth Banking Act 1959 to use the restricted expressions “building society” or “credit union” (s 4).
• Declares a general construction rule that, unless another provision of this Regulation provides otherwise, references to various historical state statutory categories (society, building society, credit union, institutions registered under the Financial Institutions (New South Wales) Code and related phrases) appearing “in any Act (other than the Financial Sector Reform (New South Wales) Act 1999) or statutory instrument” are to be read as references to either an ADI (authorised deposit-taking institution) or to an authorised building society/authorised credit union or to a friendly society or to other mapping specified in subparagraphs (a)-(e) of clause 5 (s 5).
• Applies the construction rule across a series of identified NSW Acts and provisions by tying the old language to contemporary categories: for example, mapping building societies and credit unions to “ADI” in the Confiscation of Proceeds of Crime Act 1989 (s 7), mapping references in the Duties Act 1997 to the Commonwealth Financial Sector (Transfers of Business) Act 1999 (s 14(a)), and a range of analogous re‑constructions across more than a dozen named Acts (ss 6, 8-17, 19-22, 20, 21).

The Regulation does not create new substantive regulatory obligations, criminal offences or regulatory powers in itself. Its function is to ensure continuity of statutory operation by stipulating how legacy references to state-based financial-institution categories are to be read after the federal reforms and the transfer date (s 5; see also s 4 for the defined terms).

The instrument therefore operates as a mapping device that alters statutory interpretation across many NSW Acts so that statutory references align with the federal conception of an ADI or the narrower “authorised building society/authorised credit union” statuses created by Commonwealth consents. The Regulation also provides temporal mechanics in several provisions, distinguishing how certain references are to be read before and after consequential amendments to those target Acts come into force (for example clauses 6(1)/(2), 13(1)/(2), 15(1)/(2) and 17(1)/(2)).

The Regulation rests on a small set of concepts and a single, general construction rule that carries the main interpretive work.

Key defined terms

• Authorised building society and authorised credit union (s 4). Each is defined by a factual condition: a body corporate that “has a consent under section 66 of the Banking Act 1959 of the Commonwealth” to assume or use the restricted expression “building society” or “credit union” (or like import words). The definition ties the NSW notion of an entity to a Commonwealth statutory mechanism,section 66 Banking Act 1959,thus importing Commonwealth administrative determinations into the NSW legal map.
• ADI (authorised deposit-taking institution). The Regulation does not itself define ADI; it states that the term is defined in the Interpretation Act 1987 as amended by the Financial Sector Reform (New South Wales) Act 1999 and records that the term is used in the construction rules (s 5 note). Therefore the Regulation treats “ADI” as the technical term to be used where the old state statutes referred to societies, building societies or credit unions.

General construction rule

• Clause 5 is the hinge. It provides that, unless otherwise provided in the Regulation, in any Act (other than the Financial Sector Reform (New South Wales) Act 1999) or statutory instrument, references to institutions under prior state Codes or like terms are to be construed in specified ways (s 5). Subparagraphs (a) to (e) provide mapping examples:
  • (a) References to a society, building society or credit union under the Financial Institutions (NSW) Code are to be construed as references to an ADI.
  • (b) References to a friendly society under earlier NSW friendly-society Codes are to be construed as references to either a body that immediately before the transfer date was a society under the Friendly Societies (NSW) Code, or to a body that is a friendly society for the purposes of the Commonwealth Life Insurance Act 1995.
  • (c) “Institution registered under the Financial Institutions (New South Wales) Act 1992” becomes “ADI”.
  • (d) A financial institution described as having “the same meaning as in the Financial Institutions (NSW) Code” is to be read as an authorised building society or authorised credit union.
  • (e) A “non-bank financial institution which is governed by the Financial Corporations Act 1974 of the Commonwealth or the Financial Institutions Code 1992” is to be construed as an ADI.

The Regulation affects three categories of actors and institutions directly, and several categories indirectly through administrative and legal consequences.

Directly affected entities

• Bodies corporate that formerly or commonly used the labels “building society” or “credit union” in NSW law. Those entities are now to be treated either as ADIs or as “authorised building societies”/“authorised credit unions” depending on whether they hold a consent under section 66 of the Commonwealth Banking Act 1959 to assume those restricted expressions (s 4; s 5(a), (d)).
• ADIs generally, in the sense that many NSW statutory references that formerly targeted state-registered building societies or credit unions are to be read as references to an ADI (s 5(a), (c), (e)). This brings into the scope of multiple NSW Acts any entity that is an ADI under the Commonwealth-derived definition.
• Friendly societies, to the extent that references to “society” or “friendly society” under older NSW codes are re‑construed either as bodies that immediately before the transfer date were societies under the Friendly Societies (NSW) Code or as bodies that are friendly societies under the Commonwealth Life Insurance Act 1995 (s 5(b)).

State agencies and regulators

• NSW agencies that administer the listed statutes will need to apply the construction rules when interpreting eligibility, exemption, liability, taxation, trustee, court‑jurisdiction and forfeiture provisions across the listed Acts (clauses 6-22). For example, revenue agencies administering the Duties Act 1997, Land Tax Management Act 1956, and Stamp Duties Act provisions must apply the Regulation’s constructions in assessing charges and exemptions (see s 14; s 17; s 20).
• Courts and tribunals interpreting the specified NSW Acts will be required to construe statutory references in accordance with this Regulation unless the target Act itself provides an alternative construction (s 5 begins with “Unless otherwise provided in this Regulation...”).

Third parties and counterparties

• Customers, creditors and counterparties of entities that were historically building societies, credit unions or friendly societies. Contracts, security documents, trust instruments, tax filings and stamp duty forms that refer to the pre-reform categories may now be read as referring to ADIs or authorised building societies/credit unions. This affects contract interpretation, trustee duties and statutory exemptions or liabilities under a range of Acts (clauses 6-22).

This Regulation itself does not create novel duties or rights for regulated entities; rather it reallocates who falls within pre-existing duties, rights, exemptions and liabilities across a range of NSW Acts by redefining the statutory referents. The practical legal duties and rights therefore flow from the instruments that are reinterpreted.

How duties are shifted

• Compliance duties in target Acts. Where an Act imposes obligations on “building societies”, “credit unions” or “institutions registered under the Financial Institutions (New South Wales) Act 1992”, those obligations are to be read as applying to ADIs or authorised building societies/authorised credit unions as per clause 5. For example, duties in the Stamp Duties Act 1920, Duties Act 1997 and Land Tax Management Act 1956 that depend on the classification of an entity will be borne by those entities to the extent they are classed as ADIs or authorised societies under this Regulation (ss 20, 14, 17).
• Rights and exemptions. Similarly, statutory rights and exemptions that depend on being a building society or credit union will be available only where the entity meets the Regulation’s mapped status. For example, references to “continuing building society” in the Duties Act Dictionary are re‑construed as “authorised building society” (s 14(b)).

Specific statutory examples and the rights/duties they carry

• Trustee and trust duties. The Trustee Act 1925 (s 21 reference) and the Trustee Companies Act 1964 (s 22 reference) are affected by construction changes. Trustee powers and the availability of certain trust investment or appointment mechanisms that reference financial‑institution statuses may therefore be applied to ADIs or authorised societies.
• Criminal proceeds and asset recovery. The Regulation maps building society/credit union references to ADIs in the Confiscation of Proceeds of Crime Act 1989 and Criminal Assets Recovery Act 1990 (ss 7 and 11). That determines whether confiscation powers, restraint orders, and asset forfeiture provisions cover funds or property held by the relevant entities.
• Court jurisdiction and procedures. District Court Act 1973 references to building societies and credit unions are to be read as ADIs, affecting litigation venue, definitions within court rules, and perhaps capacities in enforcement proceedings (s 13).
• Revenue and tax duties. The Duties Act 1997, Land Tax Management Act 1956 and Stamp Duties Act 1920 references mapped by the Regulation will alter who is treated as liable for duties or eligible for exemptions. The Regulation also explicitly treats certain mergers or transfers under Stamp Duties Act section 98A as transfers of business under the Commonwealth Financial Sector (Transfers of Business) Act 1999 (s 20(4)). That affects the availability of duty reliefs on transfers.

This Regulation does not introduce new criminal offences, civil penalties or enforcement powers. Its effect on penalties and enforcement is indirect: it changes which entities are subject to existing penalties and enforcement mechanisms contained in the target NSW Acts.

No penalties created here

• The Regulation contains no penal provisions, monetary penalties, or enforcement mechanics. It is an interpretive and transitional instrument aimed at re‑labelling statutory referents across other Acts (see the whole text; cf. s 5 and the schedule of affected Acts).

Indirect effect on enforcement in other Acts

• The Regulation changes who falls within the scope of statutory offences and enforcement powers in the affected Acts by construing old references as references to ADIs or authorised societies. For example:
  • Confiscation and asset‑recovery powers. By construing “building society” references to an ADI in the Confiscation of Proceeds of Crime Act 1989 and Criminal Assets Recovery Act 1990, the Regulation may broaden or narrow the set of entities whose assets can be subject to confiscation orders or restraint orders under those Acts (ss 7 and 11).
  • Court jurisdiction and enforcement. The District Court Act 1973 mapping to ADI affects definitions used in enforcement proceedings and may influence which entities are amenable to particular remedies in that court (s 13).
  • Revenue penalties and duty assessments. The Duties Act, Land Tax Management Act and Stamp Duties Act mappings can change which entities can be assessed for duties, or can claim exemptions or reliefs; the enforcement of duty liabilities and associated penalties remains governed by each revenue Act, but the class of liable entities is altered (ss 14, 17, 20).

Administrative enforcement discretion

• Agencies must apply the construction rules when exercising administrative discretions that depend on statutory categories. For example, revenue officers assessing exemptions that depend on an entity being a “continuing building society” must treat that term as “authorised building society” for the duties regime (s 14(b)). That shifts administrative discretion to take into account Commonwealth consents or ADI status.

Practical enforcement implications

• A body that loses its status as a “building society” in practice because it no longer has a s 66 consent may thereby become ineligible for specific exemptions or may become liable to statutory requirements. Conversely, an entity that qualifies as an ADI under the Commonwealth framework may pick up duties or liabilities it did not previously face under NSW law.

The Regulation’s entire purpose is cross‑statutory interaction: it reinterprets many NSW statutory references to reflect Commonwealth financial-sector reform. The interactions are explicit and numerous.

Primary interaction mechanisms

• Re‑construction of statutory references. Clause 5 is the primary mechanism that creates the interaction. It instructs that references in NSW Acts or statutory instruments to “society”, “building society”, “credit union”, “institution registered under the Financial Institutions (New South Wales) Act 1992” or similar phrases are to be construed as references to ADIs or to authorised building societies/credit unions, or mapped per the subclauses (s 5).
• Reliance on Commonwealth determinations and statutes. The Regulation repeatedly references Commonwealth statutory machinery. For entity status it depends on:
  • Section 66 of the Banking Act 1959 (Commonwealth) for the consents that create the “authorised” labels (s 4).
  • The Commonwealth Financial Sector (Transfers of Business) Act 1999 for the treatment of mergers/transfers and for certain duty and transfer references (s 14(a); s 20(4); s 21).
  • The Life Insurance Act 1995 for the modern conception of “friendly society” used in the mapping (s 5(b)(ii)). The effect is to make NSW statutory reach contingent on Commonwealth licensing/consent and transfer frameworks.

Specific cross-Act examples

• Duties Act 1997 (s 14). The Regulation substitutes a reference to the Commonwealth Financial Sector (Transfers of Business) Act 1999 where the Duties Act refers to Part 7 or 8 of the old NSW Financial Institutions Code. It also construes “continuing building society” as an authorised building society. That alters duty exposures and the availability of reliefs tied to transfers of business.
• Stamp Duties Act 1920 (s 20). The Regulation equates certain mergers or transfers of engagements between building societies/credit unions with transfers of business under the Commonwealth transfers Act. That explicitly links NSW stamp duty treatment to the Commonwealth transfer process.
• Confiscation and asset recovery (ss 7, 11). The Regulation maps building society/credit union references to ADIs in both the Confiscation of Proceeds of Crime Act 1989 and the Criminal Assets Recovery Act 1990, bringing Commonwealth‑defined ADIs within the reach of state asset recovery mechanisms.
• Trustee and trustee companies legislation (ss 21, 22). The Trustee Act 1925 and Trustee Companies Act 1964 references are reinterpreted; for the Trustee Companies Act the regulation substitutes the Crown Solicitor for a now‑replaced Queensland body as a named reference in s 36A(4) (s 22). This is an example of administrative housekeeping to maintain operability of trustee provisions.

The Regulation’s text contains internal notes about commencement, consequential application and at least one repeal. The instrument is itself a transitional piece connected to a web of state and Commonwealth amending legislation.

Commencement and transfer date

• The Regulation commences on the “transfer date” (s 2). The transfer date is defined under the Financial Sector Reform (New South Wales) Act 1999 as the date specified under section 3(16) of the Commonwealth Financial Sector Reform (Amendments and Transitional Provisions) Act (No. 1) 1999. The editorial note records that the transfer date for the Commonwealth Act was 1 July 1999 (s 2 note). That is the operative date for the Regulation’s commencement.

Internal repeal

• Clause 18 is marked “Repealed” and its marginal note indicates: “cl 18: Rep 2006 No 120, Sch 2.29.” The Regulation therefore has at least that internal alteration recorded (cl 18 note).

Cross‑references to amending Acts

• Several clauses reference the Co‑operative Housing and Starr‑Bowkett Societies Act 1998 and specify different constructions before and after amendments made by that Act come into force (for example clauses 6, 13, 15, 17). The Regulation anticipates the sequencing of those state amendments and provides transitional constructions accordingly.
• The Regulation also explicitly links to the Commonwealth Financial Sector (Transfers of Business) Act 1999 in several places (for example s 14(a), s 20(4), s 21). That indicates the Regulation was drafted as part of a coordinated state/federal reform package and is intended to operate alongside a set of Commonwealth enactments.

Notes and editorial guidance

• The Regulation includes editorial notes explaining the meaning of the transfer date and the definition of ADI (s 2 note; s 5 note). Section 3 explicitly states that explanatory notes and editorial notes are not part of the Regulation (s 3). Those notes are therefore for guidance rather than legal effect.

Implications for tracking amendments

• The Regulation’s heavy reliance on the operation and definitions in Commonwealth legislation and other NSW amending Acts means that an up-to-date understanding requires checking:
  • Commonwealth instruments and registers for s 66 consents under the Banking Act 1959 to determine authorised labels (s 4).
  • Subsequent amendments to the listed NSW Acts, which the Regulation was designed to complement. Where those Acts were amended later, the constructions here might be superseded or rendered redundant for particular provisions.

The Regulation text itself does not list any cases or litigation. It contains no schedules of judicial interpretation and does not cite judicial authorities. Therefore from the instrument alone there are no reported cases it names or decisions it records.

What the Regulation shows about likely litigation vectors

• Topics where litigation might arise, based on the Regulation’s function, include:
  • Classification disputes. Parties may litigate whether a particular entity is an ADI, an “authorised building society” or an “authorised credit union” for the purposes of a specific NSW Act. Determination of that status will involve examining Commonwealth consents (s 4) and the ADI definition in the Interpretation Act 1987 (s 5 note).
  • Transitional timing disputes. Because several clauses differentiate application before and after particular state amendments, litigation could arise over whether a given provision or construction applied at a particular time, particularly in ongoing proceedings that span the transfer date or staged amendments (see clauses 6, 13, 15, 17 for examples).
  • Revenue and duty disputes. Re‑construing mergers and transfers as “transfers of business” under the Commonwealth transfers Act for stamp duty and duties purposes may lead to litigation between taxpayers and revenue authorities on whether the mapping applies in individual transactions (s 20(4); s 14(a)).
  • Asset recovery and confiscation. The inclusion of ADIs within the reach of the Confiscation of Proceeds of Crime Act 1989 and Criminal Assets Recovery Act 1990 (ss 7 and 11) creates potential litigation in asset‑forfeiture proceedings where parties argue status or the applicability of statutory definitions.

What is not available in the Regulation

• The instrument does not record any judicial interpretation or settled case law confirming its constructions. The Regulation therefore leaves courts to apply its language to facts and existing or future disputes without in‑Regulation guidance from precedent.

Practical advice for research

• To identify litigation that has interpreted or applied the Regulation, researchers must consult case law databases and review decisions that address the listed NSW Acts since the transfer date (1 July 1999). Particular search terms likely to reveal relevant cases include “authorised building society”, “authorised credit union”, “ADI”, “transfer of business” and the specific target Acts (for example Confiscation of Proceeds of Crime Act 1989).

The Regulation looks small and technical, but several traps for practitioners and administrators arise from its mechanics. These are practical points where misreading the Regulation’s limited language can produce incorrect legal advice or administrative error.

1. “Authorised” is a Commonwealth consents concept, not a NSW licence (s 4)

• The Regulation defines “authorised building society” and “authorised credit union” by reference to consents under section 66 of the Commonwealth Banking Act 1959 (s 4). Practitioners should not assume that state registration alone creates the authorised label. The determinative fact is the existence of a Commonwealth s 66 consent.

2. ADI is not defined in the Regulation; check the Interpretation Act and Commonwealth law (s 5 note)

• Clause 5 maps many state references to “ADI”, but the Regulation does not define ADI itself. The note points to the Interpretation Act 1987 for that definition. Misapplication of “ADI” without checking the Commonwealth and Interpretation Act definitions can be consequential.

3. The Regulation excludes its own parent Act (s 5)

• Clause 5 expressly excludes the Financial Sector Reform (New South Wales) Act 1999 from the construction compass. Do not apply clause 5 to interpret that Act.

4. Timing matters for “before/after” subclauses (clauses 6, 13, 15, 17)

• Several clauses have distinct constructions before and after specified amendments to other NSW Acts commence. Practitioners must identify which subclause applies at the relevant time rather than assuming the general rule always applies.

5. Explanatory notes do not form part of the law (s 3)

• The instrument’s editorial and explanatory notes are not part of the Regulation. They are helpful guidance but cannot be relied upon as substantive law.

6. Mergers/transfers may be treated under Commonwealth transfers law for stamp duty/duties purposes (s 20(4); s 14(a))

• The Regulation equates certain transfers in the Stamp Duties Act with transfers under the Commonwealth Financial Sector (Transfers of Business) Act 1999. This can materially affect duty outcomes and relief eligibility and therefore needs careful cross-jurisdictional analysis in transactions.

Compliance with the Regulation is not about satisfying new procedural obligations imposed by the Regulation; it is about applying the Regulation’s constructions correctly in the administration, transactions and litigation that rely on the NSW Acts it affects. The steps below are practical actions for entities, advisers and agencies.

1. Confirm the relevant operative date

• Note that the Regulation commences on the transfer date, recorded editorially as 1 July 1999 (s 2). For matters spanning that date, determine which subclause (the before/after versions in clauses like 6, 13, 15, 17) applies.

2. Determine the entity’s Commonwealth status

• Check whether the entity holds a consent under s 66 of the Banking Act 1959 that permits it to use the restricted expression “building society” or “credit union” (s 4). Obtain a copy of the consent or a Commonwealth register entry.
• Check ADI status under the Commonwealth ADI definition as reflected in the Interpretation Act 1987 and Commonwealth registers. ADI status, not merely a state registration, is what triggers many of the Regulation’s mappings (s 5 note).

3. Map the target NSW statutory provisions

• Identify all NSW Acts and statutory instruments relevant to your client or transaction that refer to “building society”, “credit union”, “society”, or “institution registered under the Financial Institutions (New South Wales) Act 1992”.
• Apply clause 5’s mappings to each statutory reference, minding subparagraph (a)-(e) variations. Check whether the specific Act contains its own definitions or transitional provisions that might override clause 5.

4. For transactional work, analyse transfers, mergers and duty consequences

• For mergers, transfers of engagements or transfers of business, check s 20(4) and related Stamp Duties Act guidance in the Regulation that treats some such events as transfers of business under the Commonwealth Financial Sector (Transfers of Business) Act 1999. Determine whether duty reliefs available under the Commonwealth transfers regime apply.

5. Collect and preserve documentary evidence

• For interactions with NSW agencies or courts, prepare to produce Commonwealth consents, ADI registrations, and any evidence of the entity’s status immediately before the transfer date where friendly‑society mappings are at issue (s 5(b)(i)-(ii)). Administrative officers will likely require documentary proof when assessing exemptions or liabilities.