A growing number of voices are speaking out against the federal government’s proposal to privatise the corporate registry run by the Australian Securities and Investments Commission (ASIC), with some saying small businesses could face higher fees and a more confusing process if a sale goes through.
Journalists and commentators are against the proposed privatisation because of fears it will lead to less transparency in Australia’s business world, while campaign groups like GetUp have launched petitions against the move.
It’s unclear what a sale would mean for the Australian businesses that have to register and renew their company names with ASIC. At present, registering a business name with ASIC costs $34 for the first year, or $80 for a three-year period. The same fees apply to renew a registration. To register a proprietary company with ASIC, owners must pay a $469 application fee.
Along with company registration, there are fees associated with lodging of compulsory paperwork, as well charges to businesses for accessing information.
While the government has been keen to start discussions about a potential sale – it opened a tender process earlier this year – the registry has always had a strong revenue model. As The Australian has reported, the most recent annual ASIC report highlights that more than $600 million was collected from documents lodged by companies, compared with the federal government’s funding for ASIC of $311 million.
Council of Small Business Australia chief executive Peter Strong says there are actually few voices calling actively for the sale to the register, and that there are already too many government websites for small business compliance that operate separately.
“People who are talking about this are lazy thinkers – the reality is that some things belong in government,” he told SmartCompany.
“A better plan would be to combine the ASIC register with the Australian Business Register to save administrative costs to government.”
The prospect of privatisation has raised concerns about cost increases for all elements of the company registry, both for businesses who have to pay for compliance measures and public citizens and business owners who pay to access company information.
“I think the result would be that the price would go up,” says Strong.
“What this does is highlight that it’s already too expensive for small business.”
The amount that small businesses already pay to ASIC each year is under scrutiny, with the likes of financial journalist Michael West claiming that Australians already pay more for corporate information than anywhere else in the world.
Businesses must register through ASIC but compliance information is spread across several different government sites, including business.gov.au.
“That’s a really good portal that we should also look to combine – these kinds of sites need to be used more often,” says Strong.
“Once you put this out there, the price to small business will rise.”