The ''Australian Notes Act 1910'' was an Act of the

Parliament of Australia The Parliament of Australia (officially the Federal Parliament, also called the Commonwealth Parliament) is the legislature, legislative branch of the government of Australia. It consists of three elements: the monarch (represented by the ...

which allowed for the creation of Australia's first national

banknote A banknote—also called a bill (North American English), paper money, or simply a note—is a type of negotiable promissory note, made by a bank or other licensed authority, payable to the bearer on demand. Banknotes were originally issued ...

s. In conjunction with the ''Coinage Act 1909'' it created the Australian pound as a separate national currency from the

pound sterling Sterling (abbreviation: stg; Other spelling styles, such as STG and Stg, are also seen. ISO code: GBP) is the currency of the United Kingdom and nine of its associated territories. The pound ( sign: £) is the main unit of sterling, and ...

. The act was enacted on 16 September 1910 by the Fisher Labour Government under Section 51 (xii) of the Constitution of Australia, which gives the Commonwealth Parliament the power to legislate with respect to “currency, coinage, and legal tender.” The act gave control over the issue of Australian notes to the Commonwealth Treasury and prohibited the circulation of state notes and withdrew their status as legal tender.Reserve Bank of Australia
History of Banknotes
/ref> The '' Bank Notes Tax Act 1910'', enacted in October of that year imposed a prohibitive tax on

s issued by

bank A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets. Because ...

s in Australia by imposing an annual tax of 10% on "all bank notes issued or re-issued by any bank in the Commonwealth after the commencement of this Act and not redeemed," which effectively ended the use of

private currency A private currency is a currency issued by a private entity, be it an individual, a commercial business, a nonprofit or decentralized common enterprise. It is often contrasted with fiat currency issued by governments or central banks. In many coun ...

in Australia.

Transitional measures

As transitional measures, blank note forms of 16 banks were supplied to the Australian Government in 1911 to be overprinted as redeemable in gold and issued as the first Commonwealth notes. For the next three years, some of the earlier private banknotes were overprinted by the Treasury and circulated as Australian banknotes until new designs were ready for Australia's first federal government-issued banknotes, which commenced in 1913.

Subsequent events

The ''Australian Notes Act 1910'' was repealed on 14 December 1920 by the ''Commonwealth Bank Act 1920'', which gave note issuing authority to the Commonwealth Bank. In 1960, responsibility for note printing passed to the

Reserve Bank of Australia The Reserve Bank of Australia (RBA) is Australia's central bank and banknote issuing authority. It has had this role since 14 January 1960, when the ''Reserve Bank Act 1959'' removed the central banking functions from the Commonwealth Bank. Th ...

(RBA). S.44(1) of the ''Reserve Bank Act 1959'' now prohibits private and state currencies. The section prohibits any person or a State from issuing "a bill or note for the payment of money payable to bearer on demand and intended for circulation." In 1976, Wickrema Weerasooria published an article which suggested that the issuing of

bank cheque A cashier's check (or cashier's cheque, cashier's order) is a check guaranteed by a bank, drawn on the bank's own funds and signed by a cashier. Cashier's checks are treated as guaranteed funds because the bank, rather than the purchaser, is respo ...

s violated s.44(1), (1976) 2(2) Monash University Law Review 180. to which some banks responded that bank cheques were printed with the words "not negotiable" on them, marking them as not intended for circulation and thus did not violate the statute.

References

{{Reflist Currencies of Australia Repealed Acts of the Parliament of Australia 1910 in Australian law Financial history of Australia

Transitional measures

Subsequent events

See also

References