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Consultation (ASIC)
CP 359 Update to RG 263 Financial Services and Credit Panel
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ASIC proposes that RG 263 - Financial Services and Credit Panel be updated to reflect legislative changes in the Financial Sector Reform (Hayne Royal Commission Response—Better Advice) Act 2021 (Better Advice Act). This consultation paper (CP 359) sets out ASIC’s proposals. The proposed Regulatory Guide relates solely to financial advisers.
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Released 28 February 2022
Comments close 28 March 2022
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Consultation (ASIC)
CP 358 Remaking ASIC relief on PDSs, superannuation dashboards and FSGs
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This consultation paper sets out ASIC’s proposals to remake class orders and one legislative instrument on specific disclosure requirements for financial services. The proposals are to:
- remake, in a single new instrument, relief in class orders relating to Product Disclosure Statement (PDS) in-use notices for employer-sponsored superannuation and product dashboard disclosure;
- remake, in a single new instrument, relief in instruments that relate to shorter PDSs and PDS obligations of superannuation trustees, IDPS operators and responsible entities of IDPS-like schemes; and
- remake, as a new instrument, a class order relating to Financial Services Guides (FSGs) in time critical situations.
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Released 18 February 2022. Comments close 12 April 2022.
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Consultation (APRA)
Consultation on APRA's Superannuation Data Transformation
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On 18 February 2022, APRA released a discussion paper outlining the proposals for the publication and confidentiality of data reported under the new superannuation reporting standards.
The discussion paper, draft metrics, draft publications and confidentiality proposals are available on the APRA website.
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Released 18 February 2022. Comments close 15 April 2022.
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Consultation (Treasury)
Quality of Advice Review Terms of Reference Published
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Consistent with recommendations 2.3, 2.5 and 2.6 of the Final Report of the Hayne Royal Commission, the Government is commissioning this Review which will consider how the regulatory framework could better enable the provision of high quality, accessible and affordable financial advice for retail clients. The Review (‘QAR’) will not make recommendations on:
- professional standards for financial advisers
- Royal Commission Recommendations 2.7 to 2.10
- changes to the definitions of ‘retail client’, ‘wholesale client’, and ‘sophisticated investor’
- financial services redress arrangements or
- the application of taxation and privacy laws to financial advice
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Released 11 March 2022.
A report will be provided to the Government by 16 December 2022.
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Consultation (Treasury)
CDR Sectoral Assessment for the Open Finance sector - Non-Bank Lending
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Phase 1 of the ‘Open Finance’ review in the context of the Consumer Data Right (CDR).
Public consultation has now commenced to inform the sectoral assessment for applying the Consumer Data Right to non-bank lending. Sectoral assessments are conducted with reference to the criteria set out in section 56AD of the Competition and Consumer Act 2010.
This consultation does not relate to superannuation but is provided FYI as an example of the Open Finance Sectoral Assessment consultation materials and processes. The ‘papers’ on the CDR and Open Finance will be of interest to Trustees.
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Released 15 March 2022
Consultation closes 12 April 2022
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Consultation (ASIC)
Consultation Paper (CP) 360 CCIVs: Preparing for the commencement of the new regime
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This consultation paper seeks feedback on ASIC’s proposed guidance on corporate collective investment vehicles (CCIVs). It includes proposals on how they will:
- assess Australian financial services (AFS) licence applications from corporate directors seeking to operate a CCIV
- assess AFS licence applications from persons seeking to provide financial product advice on and/or deal in CCIV securities, and
- administer the licensee obligations that will apply to corporate directors
CCIVs are an alternative to Managed Investment Schemes (MISs) in that, structurally, they are more in line with similarly-purposed investments in overseas markets. This paper sets out ASIC’s proposals to modify various relevant AFS Licensing Regulatory Guides as well as relevant AFS Licence conditions.
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Released 17 March 2022. Comments close 14 April 2022.
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Consultation (APRA)
APRA's Superannuation Data Transformation
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APRA’s Superannuation Data Transformation (SDT) project aims to drive better industry practices and improve member outcomes by significantly enhancing the comparability and consistency of reported data. The project will make it easier to scrutinise and reliably compare fund and product performance, especially in the choice segment of the market. Given the scale and complexity of the project, APRA has divided the consultation into three phases:
Phase 1 (the current Consultation) (Breadth) will address the most urgent gaps in APRA’s data collection, particularly for choice products and investment options;
On 18 February 2022, APRA released a discussion paper outlining the proposals for the publication and the confidentiality of data reported under the new superannuation reporting standards. Submissions on these proposals are due 15 April 2022.
Phase 2 (Depth) will increase the granularity of the entire collection, taking advantage of APRA’s new Data Collection Solution and enhanced data analytic capabilities; and
Phase 3 (Quality) will assess the quality and consistency of the additional data reported during Phases 1 and 2, and review and address any implementation issues.
Each phase will involve the release of multiple topic papers, each covering a different aspect of the consultation.
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Phase 1 Consultation was ‘issued’ on 18 February and submissions close 15 April 2022
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Consultation (APRA)
Amendments to Prudential Standard SPS 310 Audit and Related Matters
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On 10 December 2021, APRA released for consultation its proposed amendments to Prudential Standard SPS 310 Audit and Related Matters (SPS 310) to align with changes to APRA’s reporting standards for superannuation.
APRA will consult on these amendments for three months, with submissions due by 11 March 2022.
APRA issued a Letter to Trustees on 10 December 2021 outlining the purpose of the Consultation.
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Consultation opened at 10 December 2021 and close on 11 March 2022 (it is listed as ‘Ongoing’ as at 31 March 2022 on the APRA website).
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Consultation (Treasury)
Statutory Review of the Consumer Data Right
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The review will focus on implementation of Open Banking and the introduction of rules to cover the energy sector from late 2022 and consider other relevant CDR developments, such as the Digital Economy Strategy, the Government response to the final report of the Inquiry into Future Directions for the Consumer Data Right, the Consumer Data Right Strategic Assessment, and international developments.
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The Consultation commenced on 14 February 2022 and is ongoing
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Consultation (APRA)
Strengthening Financial Resilience in Superannuation
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APRA is seeking to gain further insights on sources of funding for RSE licensees, the use of the operational risk financial requirement (ORFR), reserving practices, protections afforded to trustees via insurance, provisioning for contingency expenditure items, and how these might need to adapt over time.
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The Consultation period was opened on 19 November 2021 and closes on 11 March 2022 (it is listed as ‘Open’ as at 31 March 2022 on the APRA website).
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Consultation (APRA)
Strengthening crisis preparedness
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On 2 December 2021, APRA released for consultation a discussion paper and two draft prudential standards to strengthen crisis preparedness across banks, insurers and superannuation trustees.
Draft Prudential Standard CPS 190 Financial Contingency Planning introduces requirements for all APRA-regulated entities to develop contingency plans to respond to financial stress by either recovering their financial resilience or exiting APRA-regulated activities in an orderly manner.
Draft Prudential Standard CPS 900 Resolution Planning requires large or complex entities, or those that provide critical functions to the economy, to be prepared for resolution to minimise the impact on the community and the financial system.
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Consultation commenced on 2 December 2021 and closes 29 April 2022.
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Consultation (APRA)
Prudential Standard SPS 530 Investment Governance in Superannuation
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The proposed revisions to SPS 530 respond to findings from APRA’s unlisted asset valuation thematic review and APRA’s 2018-2019 post-implementation review (PIR) of the superannuation prudential framework.
The proposed updates focus on enhancements to stress testing, valuation and liquidity management practices. This consultation will run until 16 February 2022.
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Consultation was commenced on and from 29 September and closes (according to the APRA website) on Second Semester of 2022 (or 16 February). (it is listed as ‘Pending’ as at 31 March 2022 on the APRA website).
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Consultation (Treasury)
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Consultation (Board of Taxation)
Crypto asset secondary service providers: Licensing and custody requirements &
Review of the Tax Treatment of Digital Assets and Transactions in Australia
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The Government has announced consultations and inquiries for digital transactions and crypto assets.
On 21 March, the Treasurer, Josh Frydenberg, and the Minister for Superannuation, Financial Services and the Digital Economy, Jane Hume, jointly announced that:
. the Government has released a paper seeking industry’s feedback by the end of May on proposed new crypto asset licensing and custody requirements, and covering the first stage of a broader token mapping exercise to be completed by the end of 2022;
. the Government has released the terms of reference for a review by the Board of Taxation into the appropriate policy framework for the taxation of digital transactions and assets such as crypto (which is being conducted on the basis it will not increase the overall tax burden). The Board has been asked to complete its review by 31 December; and
. the Government will release terms of reference covering its request for advice from the Council of Financial Regulators (CFR) on potential policy responses to address the issue of de-banking for financial technology firms, digital currency exchanges, and remittance providers. The CFR has been asked to provide advice to the Government by the end of June 2022.
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Treasury Consultation was opened on 21 March and closes on 27 May.
The Board of Taxation Terms of Reference were released on 21 March with a view to “report back to the Government by the end of 2022”
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Consultation (AUSTRAC)
Consultation on guidance on source of funds and source of wealth
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AUSTRAC has released draft guidance for consultation to help reporting entities understand and undertake source of funds and source of wealth checks on relevant customers.
Reporting entities must have procedures built into their AML/CTF program on when and how they establish a customer's source of funds and source of wealth.
This helps to mitigate the risk that the funds or wealth of a customer are derived from criminal activity, and protects reporting entities and the Australian economy and community from the harms of money laundering, terrorism financing, and other serious crimes.
The draft guidance explains what the source of wealth and source of funds is and when and how to collect and verify this obligation.
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Consultation open: 18 February
Consultation Close: 1 April 2022
AIST, having received an extension of time, is preparing a submission in relation to this consultation.
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Discussion Paper (APRA)
Direction for data collections
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On 31 March 2022, APRA released its discussion paper on its direction for data collections which sets out APRA's changing approach to data collection, the rationale for these changes and an outline of the implementation roadmap.
APRA has outlined plans to collect richer data on APRA Connect, its new data collection system. The proposed collections will enable APRA and peer agencies to deliver deeper insights, while ultimately reducing the burden for industry. The transition will be completed by the end of 2027 allowing APRA to fully decommission the Direct to APRA (D2A) data collection tool.
The roadmap details the proposed timing for each regulated industry moving all of its data reporting across to APRA Connect, as well as plans to introduce a series of new data collections.
APRA intends to engage closely with entities and other key stakeholders on the proposed roadmap and encourages written submissions by 24 June 2022.
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Consultation (APRA)
Proportionality and significant financial institutions
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A letter was issued to all APRA-regulated entities on 4 April 2022 regarding proposed changes to the Prudential Standards which differentiate requirements for Significant Financial Institutions (SFIs) and non-SFIs.
Amendments may be made to Superannuation Prudential Standards which use the SFI/non-SFI concept. This distinction has been used for some time to inform the Regulator’s level and intensity of scrutiny.
APRA does not expect the proposed changes to qualitative criteria to materially alter the intended application of the SFI regime.
Significant financial institution (SFI) means an RSE licensee that either:
(a) has total assets in excess of AUD $30 billion in the case of a single RSE operated by an RSE licensee, or if the RSE licensee operates more than one RSE where the combined total assets of all RSEs exceeds this amount; or
(b) is determined as such by APRA, having regard to matters such as complexity in its operations or its membership of a group.
Non-significant financial institution (non-SFI) means an RSE licensee that is not a significant financial institution.
CPS 511 – Remuneration has also been identified as a ‘candidate’ for alteration – a draft of the amended Prudential Standard is available as part of the consultation.
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Consultation opened 4 April 2022
Submissions close 2 May 2022.
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