The exposure draft regulation would amend the Corporations Regulations 2001 to provide certain targeted exemptions from the financial services provisions of the Corporations Act 2001 for participants in processes relating to the Emissions Reduction Fund (ERF).
The draft regulation would provide that:
- carbon abatement contracts, which a project proponent and Clean Energy Regulator enter into after a successful ERF bid, would not be regulated as financial products;
- certain eligible aggregation arrangements would not be regulated as financial products;
- carbon service providers who only provide financial product advice which is incidental to technical advice relating to an ERF project would not be regulated as financial advisers.
For further information, please refer to the draft explanatory statement which explains the operation of the proposed regulation.
Accompanying this draft regulation is a consultation paper which identifies the problem to be addressed by the draft regulation and how the draft regulation proposes to address the problem. The Government is seeking views on whether the draft regulation is appropriately drafted and whether further targeted exemptions are required. In particular, the Government is considering whether persons bidding into ERF auctions (known as aggregators) also require exemptions for dealing in carbon credits on behalf of members of the aggregation arrangement or for providing custodial or depository services in relation to carbon credits on behalf of the members.