Financial Services in Focus – Issue 48
By Harry New, Adrian Verdnik and Vince Battaglia
In this edition, we report on ASIC’s new guidance in relation to licensing requirements for unregistered funds and the ‘Your Future, Your Super’ draft legislation. That’s just a glimpse of our legal and regulatory round-up of the Australian financial services sector in our final update for the year.
Click on each heading below to read more about each of these areas: funds and financial products, financial product advice, financial markets, anti-money laundering, consumer credit, banking and other financial services regulation.
Funds and financial products
ASIC releases final regulatory guide on DDO
On 11 December, ASIC released the following suite of documents in relation to the design and distributions (DDO) regime:
- ASIC Regulatory Guide 274 Product design and distribution obligations.
- ASIC Corporations (Design and Distribution Obligations-Exchange Traded Products) Instrument 2020/1090.
- Public submissions on ASIC’s draft guidance.
- ASIC Report 674 Response to submissions on CP 325 Product design and distribution obligations.
We will provide more information on these developments in the coming days.
ASIC consults on proposed changes to AFSL financial requirements
On 11 December, ASIC published a consultation paper on its proposal to change the treatment of lease assets in the calculation of financial requirements applicable to AFS licensees following the introduction of AASB 16 Leases.
ASIC previously adopted a temporary no-action position for AFS licensees with respect to breaches of their financial resource requirements that arise from changes to the accounting treatment of lease assets under AASB 16 Leases (see our earlier Issue 42).
According to ASIC, ASIC Consultation Paper 336 Financial requirements: Treatment of lease assets consults on changes to:
(a) ASIC Class Orders [CO 13/760], [CO 13/761] and [CO 12/752];
(b) the standard conditions in ASIC Pro Forma 209; and
(c) the existing conditions of each AFS licence.
Consultation closes on 26 February 2021.
New requirements for time-sharing schemes released
On 11 December, ASIC published an updated ASIC Regulatory Guide 160 Time-sharing schemes (RG 160). On that day, the ASIC Corporations (Amendment) Instrument 2020/1064 and ASIC Corporations (Amendment) Instrument 2020/1065 were also registered.
According to ASIC, in addition to the updated guidance on the current regulation, RG 160 contains the following new requirements:
(a) a new ‘subject to finance’ obligation;
(b) new hardship withdrawal arrangements;
(c) new compliance and audit requirements for points-based programs to reduce the potential for dilution of members’ interests;
(d) amended disclosure requirements; and
(e) amended fees and costs disclosure requirements.
ASIC states that industry generally has until 30 September 2021 to implement the new requirements set out in the updated RG 160.
Parliament passes Financial Services Royal Commission bill implementing 20 recommendations
On 10 December, the Treasurer, Josh Frydenberg, announced that the Financial Sector Reform (Hayne Royal Commission Response) Bill 2020 has been passed by Parliament.
The bill implements 20 recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
For more information on the bill, see our earlier Issue 47.
ASIC publishes updated conflicted remuneration guidance
On 10 December, ASIC released an updated ASIC Regulatory Guide 246 Conflicted and other banned remuneration (RG 246).
According to ASIC, the updates to RG 246 reflect:
(a) the end of the grandfathering of conflicted remuneration for financial product advice from 1 January 2021; and
(b) the extension of the ban on conflicted remuneration to stamping fees paid in relation to listed investment companies and listed investment trusts (excluding real estate investment trusts) that took effect on 1 July 2020.
ASIC states that product issuers are required to provide rebates to clients for all previously grandfathered benefits that they remain legally obliged to pay on or after 1 January 2021.
Further Royal Commission bill introduced to Parliament
On 9 December, the Financial Sector Reform (Hayne Royal Commission Response No. 2) Bill 2020 (Bill) was introduced to Parliament.
This follows the Financial Sector Reform (Hayne Royal Commission Response) Bill 2020, which was introduced to Parliament on 12 November and proposes to implement a number of recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (Financial Services Royal Commission).
According to the Explanatory Memorandum, the Bill proposes to implement a further four recommendations of the Financial Services Royal Commission, namely:
(a) recommendation 2.1 in relation to ongoing fee arrangements;
(b) recommendation 2.2 in relation to requiring an AFS licensee or authorised representative who are authorised to provide personal advice to retail clients to give a written disclosure of lack of independence; and
(c) recommendations 3.2 and 3.3 in relation to ensuring that a superannuation trustee may only charge advice fees (other than fees for intra-fund advice) to a member where certain conditions are satisfied.
ASIC publishes information sheet about LIBOR transition
On 30 November, ASIC published a new Information Sheet 252 Managing conduct risk during LIBOR transition (INFO 252).
According to ASIC, INFO 252 sets out:
(a) frameworks, practices and recommendations on fair treatment of clients, representation of product performance, and client communication strategies;
(b) ASIC’s expectation of the industry, including what ASIC considers to be best practices; and
(c) buy-side entity specific guidance and recommendations.
ASIC publishes draft guidance in anticipation of new insurance claims handling and settling financial service
On 27 November, ASIC published a draft information sheet about insurance claims handling and settling, and draft amendments to ASIC Regulatory Guide 3 AFS Licensing Kit: Part 3-Preparing your additional proofs (RG 3).
The draft information sheet and RG 3 amendments arise out of proposed reforms under the Financial Sector Reform (Hayne Royal Commission Response) Bill 2020, which was introduced to Parliament on 12 November 2020. The bill proposes, among other matters, to make insurance claims handling and settling a financial service subject to the licensing regime under Chapter 7 of the Corporations Act.
For more information on the bill, see our earlier Issue 47.
Subject to the bill passing, providers of insurance claims and settling services will need to acquire an AFSL, be authorised by another AFSL holder or apply for a variation to an existing AFSL to cover the new financial service.
ASIC states that it has released the draft Information Sheet 000 Claims handling and settling: How to comply with your AFS licence obligations and draft amendments to RG 3 to assist industry to comply with the bill’s timelines.
ASIC commences first consultation on derivative reporting rule amendments
On 27 November, ASIC published a consultation paper and attachment seeking feedback on proposed amendments to the ASIC Derivative Transaction Rules (Reporting) 2013.
According to ASIC Consultation Paper 334 Proposed changes to simplify the ASIC Derivative Transaction Rules (Reporting) First consultation (CP 334), ASIC proposes to:
(a) implement the harmonised international transaction identifiers, product identifiers, common transaction data elements, and entity identifiers; and
(b) make amendments to simplify the rules and improve their fitness for purpose.
ASIC states that this first round of consultation will be followed by a second round of consultation in the second quarter of 2021.
First round consultation closes on 1 March 2021.
ASIC publishes guidance on licensing exemptions for wholesale trustees
On 25 November, ASIC published a new ASIC Information Sheet 251 AFS licensing requirement for trustees of unregistered managed investment schemes (INFO 251).
INFO 251 sets out ASIC’s position in relation to AFS licensing requirements of trustees of unregistered managed investment schemes. According to ASIC’s guidance in INFO 251:
(a) the trustee of an unregistered scheme cannot rely on the authorised representative exemption to issue, vary or dispose of interests in unregistered schemes; and
(b) under the intermediary authorisation exemption, the person who issues, varies or disposes of an interest in an unregistered scheme cannot also be the person who makes the offer to arrange for the issue, variation or disposal of the interest.
ASIC places stop order on advertisements for a registered scheme for making misleading comparisons
On 20 November, ASIC announced that it has placed a stop order prohibiting a responsible entity from promoting or making statements that compare a registered scheme to term deposits or offer a fixed return without proper risk warnings.
ASIC states that it formed the view that certain radio advertisements were misleading or deceptive because they suggested that investments in the fund had the same or a similar level of risk as bank-issued products, which is inaccurate because the fund carries significantly higher financial risk than bank-issued deposit products.
ASIC also states that it is continuing to monitor the advertising and labelling of managed funds in the current environment. For more information about ASIC’s warning to fund managers to ensure products are ‘true to label’, see our earlier Issue 45.
New class action members may join pre-existing litigation funding scheme without triggering AFSL or scheme registration requirement
On 12 November, Rares J of the Federal Court of Australia handed down his reasons for orders made earlier in October in relation to a litigation funding scheme in Brett Cattle Company Pty Ltd v Minister for Agriculture (No 3) [2020] FCA 1628 (Brett Cattle Company v Minister).
The proceedings arise out of a class action brought by farmers in relation to a decision made by the former Minister for Agriculture, Forestry and Fisheries. Rares J held in favour of the applicant and made orders approving a notice to be given to class members. The notice included a statement that entry by members into litigation funding arrangements with the litigation funder would not be subject to the AFSL and registered scheme regulations.
On 24 July, the Corporations Amendment (Litigation Funding) Regulations 2020 (Cth) came into force and amended the Corporations Regulations to require litigation funders to hold an AFSL and comply with the managed investment scheme regime. According to regulation 10.38.01(1), the amendments ‘apply in relation to litigation funding schemes […] entered into on or after 22 August 2020‘.
In Brett Cattle Company v Minister, the litigation funding scheme was established by the litigation funder in October 2014. Rares J determined that the scheme was a litigation funding scheme that had been in existence before 22 August 2020 and that, therefore, the grant of new interests (by the litigation funder entering into new litigation funding agreements on pre-existing terms with group members) after 22 August would not amount to entry by the litigation funder or new members into a new litigation funding scheme.
This suggests that class action members may join litigation funding schemes on or after 22 August, provided that the litigation funding scheme was established prior to 22 August, without the scheme being required to register as a managed investment scheme or the litigation funder being required to hold an AFSL.
Financial product advice
Government announces reforms to wind up FASEA and transfer responsibilities
On 9 December, the Treasurer, Josh Frydenberg, and the Assistant Minister for Superannuation, Financial Services and Financial Technology, Jane Hume, jointly announced that the Government will introduce reforms in relation to the regulatory framework for financial advisers in the first half of 2021.
Specifically, the reforms are intended to:
(a) implement recommendation 2.10 of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry for a single, central disciplinary body to be established for financial advisers, by expanding the operation of the Financial Services and Credit Panel (FSCP) within ASIC; and
(b) move the standard-making functions of Financial Adviser Standards and Ethics Authority (FASEA) to Treasury, and incorporate remaining elements of FASEA’s role into the FSCP’s expanded mandate.
The joint announcement states that the result of the reforms will be the winding up of FASEA.
ASIC consults on proposed updates to client remediation regulatory guide
On 3 December, ASIC published a consultation paper on proposed updates to ASIC Regulatory Guide 256 Client review and remediation conducted by advice licensees (RG 256).
According to ASIC Consultation Paper 335 Consumer remediation: Update to RG 256, the first round of consultation aims to:
(a) clarify and seek feedback on when a remediation should be initiated;
(b) understand if and when assumptions can be relied on in a remediation;
(c) understand barriers and opportunities in effectively returning money to affected consumers; and
(d) identify any gaps in the current RG 256 and deliver the guidance necessary to empower all licensees to remediate consumers efficiently, honestly and fairly.
First round consultation closes on 26 February 2021.
On that day, ASIC also published Making it right: How to run a consumer-centred remediation, a guide for AFSL and ACL holders on the day-to-day design and execution of consumer-related remediations.
ASIC consults on draft financial adviser and mortgage broker protocol
On 19 November, ASIC published a consultation paper seeking feedback on a new reference checking and information sharing protocol for financial advisers and mortgage brokers.
The draft ASIC protocol arises out of proposed reforms under the Financial Sector Reform (Hayne Royal Commission Response) Bill 2020, which was introduced to Parliament on 12 November 2020. For more information on the bill, see our earlier Issue 47.
According to ASIC Consultation Paper 333 Implementing the Royal Commission recommendations: Reference checking and information sharing, it is intended that AFSL and ACL holders will need to comply with the reference checking and information sharing obligation from 1 October 2021. ASIC states that licensees will be required to check references and share information about individuals to whom the ASIC protocol applies.
ASIC published a draft ASIC Corporations and Credit (Reference Checking and Information Sharing Protocol) Instrument 2020/XX and draft information sheet for consultation.
Consultation closes on 29 January 2021.
ASIC consults on facilitating access to personal advice
On 17 November, ASIC released a consultation paper seeking input from industry participants and relevant stakeholders on:
(a) the issues and impediments relating to the supply of good quality affordable personal advice; and
(b) the practical steps that can be taken by ASIC and industry to improve consumer access to good quality affordable advice.
According to ASIC, a particular focus of ASIC Consultation Paper 332 Promoting access to affordable advice for consumers is on promoting access to quality ‘limited advice’, which is personal advice that does not cover all areas that are relevant to the client.
Consultation closes on 18 January 2021.
Financial markets
ASIC market integrity determination registered
On 10 December, the ASIC Market Integrity Rules (Securities Markets) Determination 2020/1102 and ASIC Market Integrity Rules (Securities Markets) Repeal Instrument 2020/1103 were registered.
According to the Explanatory Statement, the purpose of the instruments is to determine Tier 1 Equity Market Products and Tier 2 Equity Market Products for the purposes of rule 6.2.1(1)(c) of the ASIC Market Integrity Rules (Securities Markets) 2017, and to repeal the superseded instrument.
ASX consults on amendments trust and client segregated account rules
On 30 November, the ASX published a consultation paper seeking feedback on proposed amendments to the ASX Clear Operating Rules and Procedures and the ASX Clear Operating Rules Guidance Note 12 Trust and Client Segregated Accounts.
According to ASX Consultation Paper Trust and Client Segregated Accounts, the purpose of the proposed amendments is to provide an improved framework and additional guidance to assist participants to comply with their client money obligations.
The ASX has proposed, subject to feedback, a 12-month transition period that will commence on the publication of the revised Rules, Procedures, and Guidance Note.
Consultation closes on 8 February 2021.
ASX consults on ASX Listing Rules and form changes
On 30 November, the ASX published a consultation paper seeking feedback from interested stakeholders on proposed changes to the ASX Listing Rules.
(a) consults on new and updated forms (and ASX Listing Rule amendments to facilitate those forms) as part of the ASX’s ‘Straight Through Processing’ project. This includes new online forms for notification of buy-backs and notification of cessation of securities; and
(b) consults on other amendments to the ASX Listing Rules, including requirements in relation to the cancellation or deferral of previously announced dividends, distributions and interest payments and changes to the timetable for certain corporate actions.
View the annexures to the consultation paper.
The ASX states that, subject to regulatory approvals, it expects the proposed amendments to the ASX Listing Rules to take effect on 20 March 2021.
Consultation closes on 24 December.
ASX confirms expiry of temporary emergency capital raising class waiver and other reminders for listed entities
On 19 November, the ASX issued Compliance Update No. 10/20. In this update, the ASX:
(a) confirmed the expiry of its temporary emergency capital raising measures on 30 November. For more information on the temporary emergency capital raising measures, see our earlier article and Issue 42;
(b) announced that it is proposing to issue a further class waiver to give effect under the ASX Listing Rules to ASIC’s intention to extend Chapter 2M and 7 reporting and lodgement deadlines for listed entities (for information on ASIC’s announcement, see our earlier Issue 47);
(c) announced a new 2021 reporting calendar for listed entities with a 30 June or 31 December balance date, and reminded listed entities of upcoming deadlines for periodic reports;
(d) advised listed entities about upcoming changes to ASX online forms, and reminded listed entities to use ASX online forms to announce dividends or distributions for the period ending 31 December by no later than 23 December;
(e) confirmed that the new go-live date for the CHESS replacement system is April 2023 (for more information, see our earlier Issue 47); and
(f) announced the ASX’s Christmas closure dates.
On 1 December, the ASX issued Compliance Update No. 11/20, in which the ASX announced its consultation on proposed changes to the ASX Listing Rules (for more information, see above).
Anti-money laundering
AML/CTF Rules amended to ensure IFTI reporting rules apply to new ADI
On 24 November, the Anti-Money Laundering and Counter-Terrorism Financing Rules Amendment Instrument 2020 (No. 5) (Amendment Instrument) was registered.
According to the Explanatory Statement, the purpose of the Amendment Instrument is to insert a new Chapter 78 into the AML/CTF Rules to ensure that TransferWise Australia Pty Ltd continues to report international funds transfer instructions after it becomes an ADI.
AUSTRAC reminds reporting entities to submit annual compliance reports
On 1 December, AUSTRAC reminded reporting entities that they are required to submit their 2020 compliance report by 31 March 2021 to avoid penalties, and that the COVID-19 relief applied to the 2019 compliance report will not apply this year.
On that day, AUSTRAC also announced that it is developing new guidance and reviewing existing guidance to ensure it is up to date and useful for reporting entities.
Consumer credit
ACCC releases Home Loan Price Inquiry final report
On 5 December, the ACCC published the final report of the ACCC Home Loan Price Inquiry. According to the ACCC, the final report focuses on impediments to borrowers switching to alternative lenders, and identifying cost effective recommendations to address specific impediments.
On that day, the Treasurer, Josh Frydenberg, announced that the Government will consider the recommendations made in the report and respond in due course.
For information about the interim report released earlier this year, see our earlier Issue 39.
ASIC releases report into buy now pay later industry
On 16 November, ASIC published ASIC Report 672 Buy now pay later: An industry update (REP 672).
ASIC states that its research in REP 672 shows that one in five consumers are missing payments and that while buy now pay later arrangements are working for a majority of users, some consumers are suffering harm. ASIC states that the design and distribution obligations coming into effect in October 2021 will impact the industry.
Banking
APRA publishes review of BEAR implementation
On 11 December, APRA published an information paper detailing the findings from its review of the implementation of the Banking Executive Accountability Regime (BEAR) by three large Australian ADIs.
APRA explains that the BEAR establishes accountability obligations for ADIs and their senior executives and directors. The regime also establishes, among other things, deferred remuneration, key personnel and notification obligations for ADIs.
The APRA Information Paper Implementation of the Banking Executive Accountability Regime found overall that the ADIs had designated adequate frameworks to administer the BEAR.
APRA consults on amendments to credit risk management framework
On 10 December, APRA published a letter to ADIs consulting on proposed amendments to Prudential Standard APS 220 Credit Risk Management (APS 200).
According to APRA, this follows the Government’s announced reforms to consumer credit laws, including reforms to remove responsible lending obligations on ADIs and subject non-ADI lenders to new lending requirements based largely on APS 200.
In the letter, APRA states that while it is not planning material revisions to its credit-related prudential standards or guidance, some amendments will be necessary in the event the Government’s proposed credit reforms are passed.
APRA states that the purpose of the consultation is to ensure appropriate alignment with the non-ADI lenders’ regime, and that the proposed changes will be contingent on the Government’s reforms passing as legislation.
Consultation closes on 29 January 2021.
Other financial services regulation
Foreign investment review reform bill receives Royal Assent
On 10 December, the Foreign Investment Reform (Protecting Australia’s National Security) Act 2020 (Cth) received Royal Assent. On that day Foreign Investment Reform (Protecting Australia’s National Security) Regulations 2020 was also registered.
On that day, the Treasurer, Josh Frydenberg, announced that the reforms to Australia’s foreign investment review framework implemented under the Act will commence on 1 January 2021, and will require foreign investors to:
(a) seek approval for all investments in sensitive national security land or businesses (including starting such a business), regardless of value;
(b) be subject to enhanced monitoring and investigation powers, as well as stronger and more flexible enforcement options and penalties; and
(c) continue to bear the costs of administering the foreign investment regime, under a reformed fee framework that will be fairer and simpler for foreign investors.
The Treasurer also states that the current temporary $0 monetary screening thresholds introduced in response to the COVID-19 pandemic will be removed from 1 January 2021.
Portfolio holdings disclosure requirements deferred
On 8 December, the ASIC Corporations (Amendment and Repeal) Instrument 2020/921 (Instrument 2020/921) was registered.
ASIC Class Order [CO 14/443] defers the first reporting date for the portfolio holdings disclosure requirements for superannuation funds and was originally due to expire on 31 December. According to ASIC, Instrument 2020/921 amends the first reporting day in [CO 14/443] to 31 December 2021 to allow the Government additional time to make regulations.
ASIC states that it may shorten the period of relief by a further legislative instrument depending on when regulations are made, taking into account the fact that industry will need an appropriate transition time to implement the regime.
ASIC sets out recommendations for trustees about occupational classification practices in insurance
On 3 December, ASIC announced key findings arising out of its 2019 and 2020 review of default occupational categories in life insurance held through superannuation.
ASIC also set out areas for improvement for trustees, noting that trustees may be contravening their legal obligations if they fail to ensure that insurance premiums charged to members are based on appropriate statistical assumptions.
Treasury consults on ‘Your Future, Your Super’ exposure draft legislation
On 26 November, the Treasury published exposure draft legislation and explanatory material for public consultation to implement the Government’s ‘Your Future, Your Super’ reforms. For more information about the reforms, see our earlier article.
According to the Treasury, the exposure draft legislation proposes to:
(a) require employers to make contributions into an employee’s existing fund;
(b) require APRA to conduct an annual performance test for MySuper products (and other products specified in regulations) and require trustees to give notice to members when a product fails the test, along with other requirements;
(c) provide certainty and transparency about the basis by which superannuation products will be ranked and published on a website maintained by the ATO; and
(d) require superannuation trustees to act in the best financial interests of their members.
Consultation closes on 24 December.
APRA introduces its 2020-24 Cyber Security Strategy
On 26 November, APRA introduced its Cyber Security Strategy for 2020-24.
According to a speech to the Financial Services Assurance Forum, APRA’s strategy comprises the following three primary focus areas:
(a) establishing a baseline of cyber controls;
(b) enabling boards and executives of financial institutions to oversee and direct correction of cyber exposures; and
(c) rectifying weak links within the broader financial ecosystem and supply chain.
APRA states that its strategy includes extending APRA’s influence beyond banks, insurers, and superannuation licensees to cover a wide range of services, ranging from fund managers and payment platforms to software vendors, to raise the level of maturity in supplier procurement and oversight practices.
APRA also states that it will be asking boards next year to engage an external audit firm to conduct a thorough review of Prudential Standard CPS 234 Information Security compliance and report back to APRA and the board.
APRA consults on alignment of frameworks with AASB 17
On 25 November, APRA published a discussion paper outlining APRA’s plans to align its insurance capital and reporting frameworks with the Australian Accounting Standards Board 17 Insurance Contracts (AASB 17).
Consultation closes on 31 March 2021.
ASIC extends financial reporting and lodgement deadlines by one month
On 25 November, the ASIC Corporations (Amendment) Instrument 2020/1080 (Instrument 2020/1080) was registered.
According to the Explanatory Memorandum, Instrument 2020/1080 amends ASIC instruments to allow entities one additional month to report to members and lodge reports with ASIC under Chapters 2M and 7 of the Corporations Act. The temporary relief applies to entities with financial years ending between 8 July 2020 and 7 January 2021 (inclusive) and half-years ending between 8 July 2020 and 7 January 2021 (inclusive) where the statutory deadline for reporting or lodgement has not already passed.
Earlier on 11 November, ASIC announced its intention to further extend financial reporting deadlines for listed and unlisted entities. For more information, see our earlier Issue 47.
ASIC publishes research on members’ engagement with insurance through super
On 20 November, ASIC published a report on the experiences of superannuation fund members who directly engaged with their fund about insurance held through superannuation
ASIC Report 673 Consumer engagement in insurance in super identified:
(a) reasons for superannuation fund members engaging with their insurance;
(b) stages in the member’s engagement with their fund;
(c) members’ perceptions of the overall experience; and
(d) how members’ experiences may be improved.
ASIC states that superannuation trustees are encouraged to consider the issues raised in the report and how they might improve the experience of their members when they seek to engage about insurance.
Treasury publishes Retirement Income Review report
On 20 November, the Treasury published the Independent Retirement Income Review Final Report (Final Report).
According to the Final Report, the review has focused on establishing a fact base of the current retirement income system that will improve understanding of its operation and the outcomes it is delivering for Australians, and has not been asked to make recommendations or propose changes to policy settings.
On that day, the Treasurer, Josh Frydenberg, the Minister for Families and Social Services, Anne Ruston, and the Assistant Minister for Superannuation, Financial Services and Financial Technology, Jane Hume, jointly announced the publication of the Final Report and noted that it makes three over-arching observations about Australia’s retirement income system, being:
(a) the Age Pension, compulsory superannuation and voluntary saves contribute to provide effective support to Australian retirees;
(b) there is a need to improve understanding of the system so that all Australians can make the most of their assets in retirement; and
(c) the system would benefit from a clear objective in order to guide future policy and provide a framework for assessing its performance.
Issues paper for review of Australia’s payments system released
On 20 November, the Treasury published the issues paper for the payments system review announced by the Government on 21 October. For more information, see our earlier Issue 46.
According to the Payments System Review Issues paper (Issues Paper), the review will assess:
(a) the current structure of the governance and regulation of the payments system to assess whether it is fit-for-purpose;
(b) how to create more productivity-enhancing innovation and competition in the payments system;
(c) ways to improve the understanding of businesses and consumers of alternative payment methods;
(d) whether government payment systems, including payments to citizens, are agile and can take advantage of new payments functionality, to enhance service delivery; and
(e) global trends and how Australia should respond to these trends to ensure that it continues to remain internationally competitive.
The Issues Paper set out questions to which interested parties are invited to respond.
Consultation closes on 31 December.
APRA publishes FAQ on treatment of Coronavirus SME Guarantee Scheme loans
On 19 November, APRA published a new frequently asked question in relation to its expectations for the credit risk capital treatment of loans covered by the Coronavirus SME Guarantee Scheme.
ACCC publishes finalised on-boarding guide for CDR participants
On 18 November, the ACCC published the finalised on-boarding guide for data holders and data recipients to commence participating in the Consumer Data Right (CDR) ecosystem.
According to the ACCC, the Consumer Data Right On-boarding Guide for Data Holders and Data Recipients sets out matters including prerequisites for participation, CDR participant responsibilities, and steps in the on-boarding process.
The ACCC also published supplementary information to the on-boarding guide.
ASIC outlines key AASB 17 implementation matters for insurers
On 17 November, ASIC outlined a number of key matters insurers should consider as part of plans to implement the new accounting standard for insurance contracts, Australian Accounting Standards Board 17 Insurance Contracts (AASB 17).
AASB 17 is effective for reporting periods beginning on or after 1 January 2023. According to ASIC, insurers are required to disclose the impacts of the new standard in 31 December 2020 financial reports.