By Mark Bland, Partner, Stephen Putnins, Partner, Geoffrey McCarthy, Special Counsel, Sheridan Handley, Senior Associate, Vijay Adithya, Lawyer and Sam Morris, Consultant

This update is designed to help superannuation trustees track and manage regulatory change. We look ahead to forthcoming developments and look back at recent changes.

We have collaborated with Argos Reg-Tech to create Argos, an online platform where subscribers can find detailed analysis of regulatory reforms, updated on a daily basis. Contact us if you would like to learn how Argos can help your firm manage the risks of regulatory change.

Argos Breach Consult –this breach reporting consultation tool helps financial firms navigate the labyrinth of assessing a breach for reportability. Please get in touch with us to find out more.

Key developments

In its Discussion Paper on Phase 2 of APRA’s data transformation, it says that APRA is considering the complete suite of data needed to support APRA’s prudential supervision and the needs of other industry stakeholders, including other regulators. While there is already a significant volume of data on the superannuation industry, there are important gaps in coverage and quality that inhibit deeper insights on RSE licensees’ business operations and a better understanding of how outcomes are being delivered to their members. Trustees need to consider this together with APRA’s consultation proposals about disclosure and confidentiality.

Also connected is Wayne Byers speech to the American Chamber of Commerce in Australia where he said APRA has set itself three goals for its Modernising the Prudential Architecture initiative:

• to devise better regulation – a set of prudential requirements that are easy to find, navigate and understand.
• to adopt a digital first approach – building a foundation that enables suptech, regtech, and AI solutions, enabling better compliance at lower cost.
• to ensure the framework is responsive to innovation – capable of dealing with the digital economy, and not trying to force-fit the new into the old.

ARGOS is an example itself of enabling better compliance at lower cost which the regulatory object will support in developing.

In the Courts, ASIC’s action against Macquarie Bank alleging breaches of the efficient honest and fair obligations and misleading conduct in relation to transactions in the bank account of the defendant, and ASIC focus on improved systems and conflicts management in the context of its work on investment selections made with insider knowledge shows again its willingness to address matters that might have been considered a matter more for other regulators. ASIC also secured a $20m penalty against superannuation trustee BT Funds Management Ltd for breaches of the prohibition against conflicted remuneration and false or misleading statements.

Last Week

4 April – APRA released a discussion paper in relation to Superannuation Data Transformation Phase 2 ‘Depth’.

4 April –  The Government published its response to the Senate Economics References Committee’s report, “Greenfields, cash cows and the regulation of foreign investment in Australia”

5 April – A DIN is required before a person who wasn’t a director before is appointed.

5 April – ASIC commenced civil penalty proceedings in the Federal Court against Macquarie Bank.

6 April – The Department of Home Affairs released a discussion paper for consultation on the development of the National Data Security Action Plan.

6 April – ASIC published a media release on superannuation trustees strengthening governance practices.

6 April – ASIC said it has extended their contracts for difference (CFD) product intervention order for 5 years and published Report 747 Response to submissions on CP 348 Extension of the CFD product intervention order although the extension instrument does not appear to have been registered at before 8 April 2022.

6 April – ASIC Commissioner Armour spoke on regulating crypto-asset–based investment products within the financial services framework.

6 April – The ATO announced they are developing advice and guidance for a list of superannuation issues.

6 April – APRA published Chair Wayne Byres’ Opening Statement to the Senate Economics Legislation Committee.

6 April – The Family Court Amendment Bill 2022 (WA) was introduced allowing separating de facto couples in Western Australian to split their superannuation.

7 April – APRA published Chair Wayne Byres’ speech on regulating new financial technologies.

7 April – ASIC advised that will would allow COVID-19 temporary relief for financial advice to automatically repeal 15 April 2022.

7 April – The Senate Select Committee on COVID-19 concluded its inquiry and tabled its report.

8 April – The Federal Court ordered superannuation trustee, BT Funds Management Limited pay a $20 million penalty for incorrectly charging commission payments to members of one of its superannuation funds.

8 April – The RBA published its Financial Stability Review covering superannuation funds.

Upcoming soon

14 April – CCIV Consultation close for Consultation Paper 360 – CCIV: ‘Preparing for the commencement of the new regime’.

15 April – ASIC COVID-19 related financial advice relief scheduled to end.

15 April – Comments on APRA Consultation paper on Superannuation Data Transformation – Publications and confidentiality due.

22 April – AFCA new funding model consultation closes.

22 April – Submission are due responding to the Government’s issues paper Positioning Australia as a Leader in Digital Economy Regulation.

29 April – Consultation closes for APRA’s Discussion Paper on Strengthening crisis preparedness and drafts of CPS 190 Financial Contingency Planning and CPS 900 Resolution Planning.