Today the Morrison Government introduced legislation into Parliament to improve Australia’s taxation regime for the managed funds industry.
The legislation provides for a package of technical amendments that will clarify the tax law in relation to attribution managed investment trusts.
“These amendments are important reforms as they will provide industry with increased investment certainty,” Assistant Treasurer, the Hon Stuart Robert MP said.
The attribution tax regime was designed to give greater certainty to investors in managed funds, reduce compliance costs for the funds and enhance the overall competitiveness of Australia’s funds management industry.
The legislation also repeals subsection 51(3) of the Competition and Consumer Act 2010.
This implements a recommendation from the Productivity Commission’s 2016 Intellectual Property Arrangements Inquiry Report. The 2015 Competition Policy Review also recommended repealing subsection 51(3).
This subsection exempts licensing or assignment of intellectual property from most of the prohibitions on anti‑competitive conduct in Australia’s competition law. The Productivity Commission found that the rationale for the exemption has largely fallen away, as intellectual property rights and competition are no longer thought to be in fundamental conflict.
This reform will ensure that commercial transactions involving intellectual property rights, including the assignment and licensing of such rights, will be subject to the prohibitions on anti-competitive conduct in the competition law.
The Australian Competition and Consumer Commission (ACCC) will issue guidance on the application of the competition law to intellectual property rights, as recommended by the Productivity Commission.
The measure will take effect six months after the Bill receives the Royal Assent. This transitional period will allow individuals and businesses time to review existing arrangements to ensure they comply with the competition law. If necessary, they will be able to apply to the ACCC for authorisation of existing arrangements. Authorisation removes the risk of legal action under the competition provisions and may be granted by the ACCC where conduct is likely to provide a net public benefit.
The legislation introduced today by the Morrison Government also extends deductible gift recipient status to new organisations, including organisations promoting Indigenous languages.