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. This article lists some of the items we have covered recently in ARGOS.

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Key developments

As we look forward to the new Parliament sitting, the new Government has announced a review on the Your Future Your Super amendments which is likely to focus on the performance measures which is welcome but unfortunately has meant pushing back the testing for non MySuper products until 1 July 2023. At the same time consultation has opened on allowing ‘faith based products’ to have a second chance test.

A number of important changes did come into effect on 1 July 2022 including changes to SGC, the retirement incomes covenant on which the regulators had provided some guidance, APRA SPS 250 on Insurance in Super as well as the new AFCA funding model and the end of transition concerning ongoing advice fees.

ASIC has been active in litigation and disciplinary proceedings.  It continues to show interest in climate risk with ASIC warning against greenwashing, including climate disclosure in its financial reporting surveillance reporting and encouraging contributions to international consultations.

ASIC’s article Helping or Harming? How Behavioural Levers Can Influence People’s Financial Outcomes may be an indication of increased regulatory focus on manipulative techniques to influence consumers, rather than just misleading conduct.  The new Government may have appetite for reform in this area.

Last Month

14 June – ASIC published a Media Release on How to avoid ‘greenwashing’ for superannuation and managed funds.

14 June  – ASIC remade relief on PDSs, superannuation dashboards and FSGs.

14 June  – ASIC published article in Behavioural Economics Guide 2022 on behavioural levers.

15 June  – Avanteos Investments Limited convicted and penalised and for failures to update defective disclosure statements and continuing to charge fees to deceased superannuation members.

15 June – APRA published new FAQs to provide further guidance on the administration of the Government’s Your Future, Your Super performance test.

15 June  – High Court handed down its decision in Hill v Zada Pty Ltd as trustee for The Holly Superannuation Fund on binding death benefit nominations and smsfs.

16 June  – The Reserve Bank of Australia June 2022 bulletin was published including an article on Household Liquidity Buffers and Financial Stress.

16 June  – Transitional Registry Operations Data Standard 2022 commenced.

17 June  – The Australian National Audit Office (ANAO) completed an audit on the Commonwealth Superannuation Corporation (CSC).

20 June  – ASIC released May 2022 financial adviser exam results.

20 June  – The Federal Court ordered Squirrel Superannuation Services Pty Ltd pay a $55,000 penalty for false and misleading marketing on action by ASIC.

21 June  – The ANAO audit of the Administration of Critical Infrastructure Protection Policy was published.

22 June  – The Government issued a statement confirming that Crypto will continue not to be taxed as a foreign currency.

22 June  – ATO published its protocol on Legal Professional Privilege claims.

22 June  – SuperStream Rollover v3 supporting information published.

22 June  – The ATO published guidelines to explain its approach to information gathering.

23 June  – ASIC published new and updated guidance for Corporate Collective Investment Vehicles and also published Report 728 on submission and Information Sheet 272 on how to register a corporate collective investment vehicle and sub-fund.

23 June  – APRA published the speech of Chair Wayne Byres and Executive Director of Superannuation Suzanne Smith from the Trans-Tasman Business Circle “Meet the regulators” event.

23 June  – ASIC called for better disclosure of business risks and asset values following financial reports review

23 June  – Minister Jones published a Media Release stating its commitment to the Quality of Advice Review.

23 June  – APRA published new FAQ’s on the Superannuation Data Transformation.

24 June – ASIC published the findings from its review of superannuation trustees’ communications with their members following the first annual performance test for MySuper products.

27 June  –ASIC Corporations (Amendment) Instrument 2022/519 was registered dealing with rounding in financial reporting.

28 June  – Treasury published a consultation paper for a post implementation review of the stamping free exemption.

28 June  – Australian Prudential Regulation Authority Supervisory Levies 2021/22 Determination 2022 was registered.

29 June  – ASIC published a media release to encourage submissions to the International Sustainability Standards Board consultation on global baseline climate and sustainability disclosures.

29 June  – The ATO published information regarding streamlining transfer balance account reporting (TBAR) for self-managed super funds (SMSFs).

29 June  – Council of Financial Regulators (CFR) responded to the Treasury’s enquiries regarding superannuation fund’s use of derivatives.

30 June  – ASIC sues Mercer Financial Advice for misleading customers.

30 June  – ASIC published consultation paper proposing to remake its class order on the financial requirements for issuers of over-the-counter (OTC) derivatives to retail clients

30 June  – APRA released a letter to registrable superannuation entity licensees of Defined Benefit funds to seek their input on the amendments to the Superannuation Guarantee (Administration) Act 1992 (SGAA).

30 June  – ASIC registered an instrument which provides conditional relief or superannuation fund trustees who prepare retirement estimates for their members, and for providers of superannuation calculators.

1 July – Revised SPS 250 on insurance in superannuation came into effect.

1 July – Transition ended for all arrangements in relation to payment of advice fees from super commenced.

1 July – Transition ended for all ongoing fee arrangements.

1 July – Budget 21-22 measures removing the $450 per month income SG threshold as well as the work test came into effect.

1 July – Retirement Income Covenant commenced.

1 July – ‘Your Future, Your Super’ additional disclosure requirements apply to all Annual Members Meetings held after this date but see below.

1 July – Financial Requirements for Corporate Directors of Retail Corporate Collective Investment Vehicles Instrument 2022/449 was registered with the CCIV regime coming into effect.

1 July – New AFCA Funding Model came into effect.

1 July – The Minister for Climate Change and Energy announced Terms of Reference for the Independent Review of Australian Carbon Credit Units.

1 July – ASIC suspended the AFS licence of ISG Financial Services Limited.

1 July – ASIC banned Melbourne based advisor David Ruthenberg for three years.

1 July – ASIC cancelled the AFS licence of Quattro Management Pty Limited.

1 July – ASIC published Regulatory Guide 260 stating it would communicate negative audit review findings to directors.

1 July – 12-month transition period for AUSTRAC guidance on multiple cash transaction threshold reporting commenced.

5 July – ASIC published Regulatory Guide 276 Superannuation Forecasts: Calculators and Retirement Estimates.

6 July – APRA launched consultation to improve remuneration disclosure reporting.

7 July – Minister announced upcoming review in August on amendments to Your Future Your Super measures and deferred the underperformance test for non MySuper products.

7 July – ASIC commenced civil penalty proceedings in the Federal Court in ASIC v Lanterne Fund Services Pty Limited.

7 July – IOSCO published their Crypto-Asset Roadmap for 2022-2023.

12 July – Enrolments for the financial advisor exam sitting in July closed.

15 July – Treasury published draft regulations to change Annual Member Meeting disclosure requirements for consultation by 28 July.

18 July – Corporations (Relevant Providers Degrees, Qualifications and Courses Standard) Amendment Determination 2022 made by Minister Jones was registered.

19 July – APRA released its final revisions to SPS 530 – Investment Governance.

20 July – APRA released amendments to the definition of ‘Significant Financial Institution’ and updated relevant prudential standards.

20 July – AFCA published information about complaints in 2021/22.

20 July – Treasury launched a consultation on the superannuation performance test treatment of faith-based products.

22 July – ASIC said it would extend reporting deadlines for unlisted entities.

25 July – Treasury commenced consultation on guidance papers on payment times reporting obligations.

Upcoming soon

26 July – Parliamentary sitting for both Houses set to commence.

28 July –  Deadline in accord with APRA FAQ 1.9 for final submission of historical data for SRF 550.0 and SRF 705.1

29 July – Due date for submissions on exposure drafts and comment letters relating to General Sustainability-related Disclosures and Climate-related Disclosures.

30 July – Submissions are due in relation to ASIC’s Consultation Paper proposing to remake its class order on the financial requirements for issuers of over-the-counter (OTC) derivatives to retail clients.