Australian senator Andrew Bragg has introduced a bill to impose reporting requirements for Chinese banks that may make the e-yuan available in Australia.
Bragg, of the conservative Liberal party, chaired Australia’s parliamentary select committee on technology and finance last year. However, since there has been a change in government, he introduced the draft law as a private members’ bill, as he does not hold a governmental position.
The Digital Assets (Market Regulation) Bill 2022 identifies seven Chinese banks that would need to comply. These are: Agricultural Bank of China, Bank of China, Bank of China (Australia), China Construction Bank, China Everbright Bank, Bank of Communications, and Industrial and Commercial Bank of China.
These banks would need to report to the central bank and the Australian Prudential Regulation Authority (Apra).
Information required would include the number of Australian businesses that have accepted payment using the digital yuan, the number of digital yuan wallets that are open, and the amount of digital yuan held by Australian customers.
An annual report containing information submitted to the Reserve Bank of Australia and Apra would be required to be sent to the prime minister and two parliamentary joint committees on corporations and financial services, and on intelligence and security.
Bragg also proposes measures to regulate crypto in Australia. He defines digital assets as value or rights with cryptographic evidence of ownership, transferred electronically via a distributed data structure.
Bragg proposes that digital asset exchanges need to be licensed, maintain minimal amounts of capital, and submit disclosures to an authority such as the Australian Securities and Investments Commission (Asic) or Apra.
Asic would be tasked with supervising digital asset exchanges in Australia. Digital asset custody services and stablecoin issuers would also be required to hold a licence.
The prospect of China wielding influence through its central bank digital currency has prompted political moves elsewhere as well. In May, the Republican Party in the US put forward a bill to bar Apple and Google from hosting apps in US stores that would allow payments in digital yuan.
Australia needs to be prepared for the widespread use of a digital yuan in the Pacific region, because it would give the “Chinese state enormous power, economic and strategic power that it doesn’t have today”, Bragg said during an interview on RN Breakfast, CoinDesk reported.
The bill is open for consultation until October 21, 2022.