The Albanese government has opened consultation for the Financial Accountability Regime Minister rules 2022 (Minister rules) after the bill was introduced last week to establish the Financial Accountability Regime (FAR).
The regime will impose accountability, key personnel, deferred remuneration and notification obligations on directors and senior executives, and be administered by APRA and ASIC.
This week, the government proposed that the Minister rules would prescribe:
- particular responsibilities and positions which cause a person to be subject to the FAR for each industry;
- enhanced notification threshold, which is the total asset size above which an entity is required to comply with additional notification obligations; and
- how a written record from an examination can be authenticated in a proceeding as prima facie evidence of the statements it records.
Earlier this year, APRA executive, Sean Carmody, said the prudential regulator was working closely with ASIC on the FAR and pledged to avoid imposing “unnecessary regulatory burden”.
“These efforts build on the activities already being undertaken across areas where the regulators have been working together more closely and on the Memorandum of Understanding in place between the regulators,” Mr Carmody said at a Senate economics committee in January.
The regime was introduced last week alongside the Financial Services Compensation Scheme of Last Resort Levy Bill 2022 (CSLR), with Minister for Financial Services, Stephen Jones, saying that government intended to wrap up the final legislation to implement the Hayne Royal Commission recommendations this year.
During his address to the Australian Institute of Superannuation Trustees (AIST), Mr Jones said this move was “long overdue”.
Shortly after, the Financial Planning Association of Australia (FPA) expressed concern that the scope of the CSLR doesn’t ensure that consumers are covered for the full range of matters considered by AFCA, including managed investment schemes (MIS).
“While it was in Opposition, Labor suggested amendments which would at least include MISs in the CSLR, and it is disappointing that these changes have not been included in the Bill,” FPA CEO Sarah Abood said.
Consultation for the Minister Rules is now open and closes on 7 October 2022.
