Super Alert – 23 April 2021

Articles


Posted By and on 23/04/21 at 4:14 PM

Welcome to the latest issue of the KHQ Super Alert which is lengthy compared with the last issue’s quiet news week. Three consultations have been released in relation to: the new breach reporting framework (ASIC), climate change risks (APRA) and the proposed single disciplinary body for financial advisers (Treasury). Regulations have been registered to provide relief for some entities from the claims handling AFSL requirements and the UK pensions regulator has released its climate change strategy for trustees of UK pension funds.

ASIC – Consultation for breach reporting guidance

On 22 April 2021, ASIC issued a consultation paper in relation to its proposed guidance for the upcoming changes to breach reporting. According to ASIC, it is expecting ‘a significant increase in the volume of reports received as a wider range of entities will be required to report and a wider range of breaches will be subject to reporting’. ASIC is seeking feedback on a draft regulatory guide and a draft information sheet.

The consultation period closes on 3 June 2021. ASIC will publish the final guidance before 1 October 2021.

Click here for details.

APRA – Draft climate change guidance

On 22 April 2021, APRA released a draft prudential practice guide for public consultation titled ‘CPG 229 Climate Change Financial Risks’. The guide will apply to APRA-regulated entities and ‘is designed to assist…in managing climate-related risks and opportunities as part of their existing risk management and governance frameworks’. According to APRA, the guidance does not ‘create new requirements or obligations, and is designed to be flexible in allowing each institution to adopt an approach that is appropriate for its size, customer base and business strategy’.

The consultation period closes on 31 July 2021. APRA will publish the final guidance before the end of 2021.

Click here for details.

Media release – Legislative reform for technology neutral laws

On 21 April 2021, the Treasurer announced that the government proposes to amend ‘laws within the Treasury portfolio so they are technology neutral’. According to the Treasurer, this will include:

  • ‘expanding the range of documents that can be validly signed electronically’;
  • ‘addressing provisions in Treasury legislation where only non-electronic payment options are in place’;
  • ‘reducing or removing Treasury portfolio legislation exemptions to the Electronic Transactions Act 1999’; and
  • reforming ‘product disclosure and recordkeeping requirements’.

It is proposed that the initial phase of this legislation will be passed by the end of 2021.

Click here for details.

Treasury – Consultation for single disciplinary body for financial advisers

On 19 April 2021, the Treasury released exposure draft legislation and explanatory materials in relation to ‘the establishment of a single disciplinary body for financial advisers and the requirement that all financial advisers who provide personal financial advice to retail clients be registered’. This was a recommendation from the Financial Services Royal Commission.

The proposed legislation seeks to:

  • expand ‘the role of the Financial Services and Credit Panel within ASIC to operate as the single disciplinary body for financial advisers’;
  • create ‘new penalties and sanctions which apply to financial advisers found to have breached their obligations’; and
  • introduce ‘a new annual registration system for financial advisers’.

The consultation period closes on 14 May 2021.

Click here for details.

ATO – Indexation of contribution caps

On 19 April 2021, the ATO issued a reminder to entities that the concessional and non-concessional contribution caps will be indexed from 1 July 2021.

The concessional cap for the 2021/22 financial year will be $27,500 while the non-concessional cap will be $110,000 or $330,000 over 3 years.

Click here for details.

ATO – Rollover reporting

On 19 April 2021, the ATO published guidance for APRA-regulated funds in relation to the activities which must be undertaken when paying a ‘rollover super benefit or death benefit to another super fund or retirement savings account’. The ATO has advised that it ‘may apply administrative penalties’ if an audit reveals ‘that an accurate statement has not been provided to the receiving fund on time’.

Click here for details.

Legislation – Relief from AFSL requirements for claimant intermediaries

On 16 April 2021, the Financial Sector Reform (Hayne Royal Commission Response) (Claimant Intermediaries) Regulations 2021 were registered on the Federal Register of Legislation. The regulations amend ‘the Corporation Regulations 2001 to exclude certain parties from the claimant intermediary definition when handling insurance claims because handling claims is typically not their core business and they often do so for no monetary benefits’. These regulations have been made to ‘avoid the unnecessary regulatory burden of requiring these parties to obtain an Australian financial services licence’.

The parties excluded are mortgage brokers, mortgage intermediaries, insurance brokers, qualified accountants, veterinarians, travel agents, financial advisers, financial counsellors, property managers, estate managers and public trustees. However, certain circumstances must apply to each party in order to rely on the relief.

Click here for details.

Legislation – Standard for issuing director identification numbers

On 16 April 2021, the Corporations Director Identification Number Data Standard 2021 was registered on the Federal Register of Legislation. This standard ‘sets out the information the Registrar will require in order to be able to give a Director Identification Number (director ID) to an individual who has applied for a director ID under the Corporations Act 2001’. This standard was part of the consultation conducted by Treasury which was referred to in our Super Alert of 19 March 2021.

Click here for details.

UK – Climate change strategy from pension funds regulator

On 7 April 2021, the Pensions Regulator in the UK published it climate change strategy which sets out its ‘strategic response to climate change and how…The Pensions Regulator (TPR) can help trustees meet the challenges from climate change’. Changes are proposed to the relevant UK legislation under which ‘trustees will be asked to work out the scheme’s carbon footprint by calculating greenhouse gas emissions of the investment portfolio…set climate-related targets…[and] ’disclose their findings by publishing a report that shares what they’ve discovered about their scheme and details of their governance arrangements’.

Click here for details.

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 - 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