Super Alert – 14 July 2023: FRAA report, Chapter 2M, greenwashing, CSLR regulations

Welcome to the latest issue of the KHQ Super Alert. This week, APRA endorsed the FRAA report assessing APRA’s effectiveness and capability, and ASIC published an article on its recent greenwashing activities. Two regulations were registered and commenced, one in relation to the Corporations Act Chapter 2M reporting and auditing requirements and the other in relation to the Compensation Scheme of Last Resort levies.

APRA – Endorsement of FRAA report

On 13 July 2023, APRA issued a media release in relation to the Financial Regulator Assessment Authority’s (FRAA) report titled ‘Effectiveness and Capability Reviews of the Australian Prudential Regulation Authority’.

According to the media release, the FRAA report made ‘five recommendations aimed at strengthening risk identification in the superannuation industry, continued development of capabilities and expertise of APRA’s people, investment in data and technology, enhancing transparency to maximise the impact of APRA’s outcomes, and lifting recovery planning and resolution readiness’.

APRA noted in the media release that it supports the recommendations and will act on them,  highlighting that they will be reflected in APRA’s Corporate Plan which will be released in August. 

The Government also issued a media release in relation to the release of the report.

Click here, here and here for details.

ASIC – Greenwashing article published

 On 10 July 2023, ASIC published an article outlining its recent activities in relation to ‘combating greenwashing’. ASIC has outlined that it supports the introduction of ‘a mandatory climate change-related disclosure regime in Australia’ and encourages industry to respond to Treasury’s current consultations in relation to ‘the government’s proposed climate disclosure standards and sustainable finance strategy’ (see our Super Alert of 30 June 2023 about the Treasury consultations).

Click here for details.

ATO – Results from APRA-regulated funds survey

On 10 July 2023, the ATO released the results of its survey for APRA-regulated funds. The purpose of the survey was ‘to gather feedback on how effectively [the ATO] and the industry are working together to administer the super system’. According to the ATO, the 2023 survey results show that while most respondents consider the ATO works effectively with APRA-regulated funds, engagement is an area for improvement and the ATO should consider ‘different models of engagement’ for providing information to the industry.

Click here for details. 

Legislation – Regulations in relation to the Corporations Act Chapter 2M reporting and auditing requirements

On 7 July 2023, the Treasury Laws Amendment (Financial Reporting and Auditing of Registrable Superannuation Entities) Regulations 2023 (Cth) (Regulations) were registered on the Federal Register of Legislation. These Regulations support the recent legislation extending the Corporations Act Chapter 2M reporting and auditing requirements to RSEs (see our Super Alert from 30 June 2023).

These Regulations were released for consultation earlier this year (see our Super Alert from 14 April 2023). According to the Explanatory Statement, this has resulted in several amendments being made to the Regulations as a result of industry feedback, including:

  • only requiring ‘disclosure of remuneration details relating to the ‘most recently completed financial year’ (rather than also to the ‘current financial year’ or the ‘two most recently completed financial years’)’; and
  • ‘updating and clarifying the information that is required to be included in the notice of an annual members’ meeting’.

Click here for details.

Legislation – CSLR regulations registered

On 7 July 2023, the Financial Services Compensation Scheme of Last Resort Levy Regulations 2023 (Cth) (Levy Regulations) were registered on the Federal Register of Legislation and commenced on 8 July 2023. The Levy Regulations were made to support the amendments made by the Financial Services Compensation Scheme of Last Resort Levy Act 2023 (see our Super Alert from 7 July 2023).

According to the Explanatory Statement, the Levy Regulations prescribe:

  • which industry sub-sectors are required to pay the annual levy;
  • ‘the general conditions that are required to be met for the annual levy to be imposed’ and ‘the general conditions for the imposition of a special levy’; and
  • methods for calculating the amount of the various levies (including the annual levy and the special levy).

Click here for details.

Attorney-General – Consultation on proposed reforms in relation to executing Commonwealth statutory declarations

On 6 July 2023, the Attorney-General’s Department began ‘consultation on proposed reforms to the execution of Commonwealth statutory declarations’. The proposed amendments are intended to replace the temporary measures which were put in place ‘in response to the COVID-19 pandemic’ and are due to expire on 31 December 2023.

The proposed amendments would allow Commonwealth statutory declarations to be executed in the following ways:

  • ‘traditional paper-based execution (requiring wet-ink signatures and in-person witnessing)’;
  • ‘e-execution (allowing electronic signatures and witnessing via audio-visual link)’; and
  • ‘digital execution (end-to-end online execution, with digital identity providers to verify identity and satisfy witnessing requirements)’.

Consultation closes on 28 July 2023.

Click here for details.

This alert was written by Kiara Leslie (Lawyer), Sanela Osmanovic (Senior Associate), Andrew Taylor (Special Counsel), and Natalie Cambrell (Director).

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KHQ Lawyers - Sanela Osmanovic

Sanela Osmanovic Senior Associate

Sanela is a Senior Associate in our Superannuation & Financial Services team, and has a broad range of experience working with a range of superannuation fund trustees... Read More

KHQ Lawyers - Andrew Taylor

Andrew Taylor Special Counsel

Andrew is a Special Counsel in the Superannuation & Financial Service team.

Andrew’s practice is focused on financial services and products, particularly superannuation, investment platforms... Read More

KHQ Lawyers - Natalie Cambrell

Natalie Cambrell Director

Natalie leads our Superannuation & Financial Services team. With more than 25 years’ experience, she has an enviable reputation for her in-depth knowledge in these highly regulated and complex... Read More