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Inside track: Superannuation, Funds Management & Financial Services

15 January 2020

#Superannuation, Funds Management & Financial Services

Inside track: Superannuation, Funds Management & Financial Services

In the media

Govt pressured to exclude SMSFs from DDO regime
Self-Managed Superannuation Funds should be exempted from the Government’s new design and distribution regime (09 January 2020).  More...

Call to phase out limited licensing and set up new advice system
The SMSF Association wants limited licensing phased out and a new advice framework established to better meet the needs of self-managed super fund (SMSF) trustees. The Association also used its submission to propose a spousal rollover, increased contribution flexibility and simplify superannuation complexity around thresholds, residency rules, death benefits and legacy pensions (09 January 2020).  More...

ASIC bans Northern NSW adviser for four years
ASIC has banned Northern NSW-based financial adviser David O’Brien from providing financial services for four years following an ASIC surveillance (08 January 2020).  More...

ASIC further suspends the AFS licence of Halifax Investment Services
ASIC has extended the suspension of the Australian financial services (AFS) licence held by Halifax Investment Services Pty Ltd (Halifax) until 8 January 2021, effective 18 December 2019 (07 January 2020).  More...

ASIC bans Perth SMSF adviser
ASIC has banned Perth-based adviser Wayne Blazejczyk from providing financial services for five years for failure to meet best interests obligations when providing advice on self-managed super funds (SMSFs) (06 January 2020).  More...

Government releases draft legislation on APRA-ASIC cooperation
The Morrison government has released for consultation draft legislation that will oblige ASIC and APRA to co-operate with one another, following a royal commission recommendation (06 January 2020).  More...

There is one word that financial planners are dreading as 2020 is ushered in Analysis
A new regime of regulation is set to hit the scandal-prone financial planning industry, and one little word in the new rule book could have very significant implications (31 December 2019).  More...

AFCA's statement regarding the release of Compensation Scheme of Last Resort discussion paper
Following the release of the public discussion paper on establishing a Compensation Scheme of Last Resort, AFCA reconfirms its strong support for creating an industry-funded scheme of last resort (30 December 2019).  More...

FASEA releases preliminary response to submissions on the Code of Ethical Guidance
FASEA issues a Preliminary Response to Submissions – FG002 Financial Planners and Advisers Code of Ethics 2019 Guidance to provide clarification on the interpretation and application of the Code relating to a number of matters raised by stakeholders during the consultation (20 December 2019).  More...

APRA releases second consultation package on its Superannuation Data Transformation
The APRA has released a second consultation package on its Superannuation Data Transformation. This release follows the launch in early November of APRA’s multi-year project to upgrade the breadth, depth and quality of its superannuation data collection (19 December 2019).  More...

FPA launches Future of the SOA digital interactive guide
The Financial Planning Association of Australia (FPA) launched the Future of the Statement of Advice (SOA) digital interactive guide to help financial planners develop more accessible, personalised and meaningful client experiences during the advice process (18 December 2019).  More...

ATO’s super news for lost super
The Australian Taxation Office (ATO) is to be given the responsibility to distribute superannuation funds from inactive accounts under new laws to be passed next year (2020). The move was among recommendations made by the Productivity Commission in its Superannuation: Assessing Efficiency and Competitiveness report (16 December 2019).  More...

Doing more to reunite Australians with their lost and forgotten super
The Morrison Government will build on its record of protecting and reuniting Australians with their lost and forgotten super with legislation to facilitate the exit of eligible rollover funds (ERFs) (13 December 2019).  More...

In practice and courts

Banking, Superannuation & Financial Services Royal Commission - Recommendation 7.1: establishment of a compensation scheme of last resort
The Coalition Government has released a discussion paper on establishing a Compensation Scheme of Last Resort. In its response, 'Restoring trust in Australia’s financial system', the Government agreed to take action on recommendation 7.1 and establish an industry-funded, forward-looking compensation scheme of last resort. The consultation closes on 7 February 2020.  More...

ATO: Opt out of super guarantee
From 1 January 2020, some workers with multiple employers can apply to opt out of receiving the super guarantee (SG) from some of their employers. The exemption certificate means the employer will not be liable for the super guarantee charge if they don't make SG contributions on your behalf for the quarters covered by the certificate.

ASIC REP-650 Overview of licensing and professional registration applications: July 2018 to June 2019
This report is for AFS licensees, Australian credit licensees, lawyers, application service providers and professionals working in financial services that are interested in the licensing and professional registration functions of ASIC. This report also outlines key regulatory issues and activities related to licensing and professional registration (16 December 2019).  More...

ASIC REP 646 Insurance in superannuation 2019–20: Industry implementation of the Voluntary Code of Practice
This report provides background to our work in insurance in superannuation. It also examines industry progress on the implementation of the Insurance in Superannuation Voluntary Code of Practice (13 December 2019).  More...

APRA Annual MySuper statistics
The Annual MySuper Statistics report contains detailed profile and structure, financial performance, fees and membership information for all MySuper products. Copies of the Annual MySuper statistics are available on the APRA website here (16 December 2019.  

APRA second consultation package on Superannuation Data Transformation 
The two topic papers released form part of Phase 1 of the Superannuation Data Transformation (Breadth), which will address the most urgent gaps in APRA’s data collection, particularly for choice products and investment options: Topic Paper 2: Performance and Topic Paper 3: Member Accounts. Submissions on these proposals will close on 14 February 2020 (19 December 2019).  More...

FPA Evolution of Advice discussion paper
Consultation now open on developing FPA’s proposed policy platform for financial planning The Financial Planning Association of Australia (FPA) has released a new discussion paper titled Evolution of Advice: The Financial Planning Profession from 2020 to 2025, and opened consultation on its proposed new policy platform. FPA members will be asked to contribute their views over the next four weeks (27 November 2019).  More...

APRA finalises revised guidance on superannuation Business Performance Review
SPG 516 provides guidance to the superannuation industry on undertaking APRA’s new requirements for an annual Business Performance Review under Prudential Standard SPS 515 Strategic Planning and Member Outcomes (SPS 515), and also the new legislated member outcomes assessment. SPG 516 is the final piece of guidance to support SPS 515 commenced on 1 January 2020.   More...

APRA consultation: proposed revisions to Prudential Standard SPS 250 Insurance in Superannuation (SPS 250) 
The proposed changes are aimed at improving superannuation member outcomes by helping trustees select the most appropriate policies for their members, and monitor their ongoing relationships with insurers.  More...

IFRS: Interest-rate benchmarks amendments
Amendments issued a focus on the accounting effects of uncertainty in the period leading up to the reform. The amendments come into effect from 1 January 2020 but companies may choose to apply them earlier. Interest Rate Benchmark Reform, which amends IFRS 9, IAS 39 and IFRS 7, can be accessed here (subscription required). A project summary, providing further information about the Board’s work in relation to IBOR reform, is also available.

ASIC consultation: foreign financial services providers relief proposals
 ASIC has extended to 31 March 2020 licensing relief for foreign financial services providers (FFSPs) to allow them to provide certain financial services to Australian wholesale clients without needing to hold an Australian financial services licence.  More...

ATO: Proposed Superannuation Guarantee amnesty
The proposed Superannuation Guarantee (SG) Amnesty (the proposed amnesty) and re-introduced the associated legislation into Parliament. Until the proposed amnesty law is enacted by Parliament, ATO will continue to apply the existing law to the SGC statements you lodge.  More...

IFRS Standards in 2020: consultations
The first major consultation document, already out for comment, proposes improving the way information is communicated in the financial statements, with a focus on financial performance. Exposure Draft General Presentation and Disclosures, which the Board published in December 2019 as part of its Primary Financial Statements project, is open for comment until 30 June 2020 (07 January 2020).  

Gazette - Superannuation Industry (Supervision) Act 1993
10/01/2020
Notice of Disqualification - Laura Lucy Ballantine; Bradley James Ballantine; Daryll King; Kevin Cream; Anna Cream

09/01/2020
Notice of Disqualification – Angela Pettit

07/01/2020
Notice of Disqualification - Kenneth Glynn

24/12/2019
Notice of Disqualification – Kenechukwu Ofor

More...

Cases

Australian Securities and Investments Commission v Dover Financial Advisers Pty Ltd (No 2) [2019] FCA 2151
CORPORATIONS – false, misleading or deceptive conduct – contraventions of s 1041H(1) of the Corporations Act 2001 (Cth) (Corporations Act) and ss 12DA(1) and 12DB(1)(i) of the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act) – consideration of the appropriate form of declarations – consideration of exercise of power of the Court to declare that an individual is involved in a contravention by another person where involvement is not itself a contravention
THE COURT DECLARES THAT – Between around 25 September 2015 and around 30 March 2018 (the relevant period), and on each occasion that its authorised representatives provided clients a “Client Protection Policy” in conjunction with, or incorporated into, statements of advice, the first defendant (Dover): (a) engaged in conduct, in trade or commerce, in connection with the supply of financial services , that was misleading or deceptive or likely to mislead or deceive in contravention of s 1041H(1) of the Corporations Act 2001 (Cth) and s 12DA(1) of the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act)

Australian Securities and Investments Commission v Westpac Banking Corporation [2019] FCA 2147
JUDGMENT SUMMARY – This case concerns the liability of Westpac Banking Corporation for the failure by one of its representatives to comply with the “best interests obligations” in Div 2 of Pt 7.7A of the Corporations Act 2001 (Cth) when he provided personal advice concerning financial products to certain retail clients. As a result of the advice and recommendations given by Mr Sinha, each of the couples altered their existing superannuation or insurance arrangements and acquired interests in or took out superannuation or insurance products or policies with companies or entities associated with Westpac

Whitt v Clough Projects [2019] FCCA 3457
INDUSTRIAL LAW – Interpretation of a Greenfields Agreement – Clough Projects Pty Ltd Onshore and Offshore Greenfields Agreement 2014 – whether the applicant was entitled to superannuation payments above the ‘maximum contribution base’ per section 19(3) of the Superannuation Guarantee (Administration) Act 1992 (Cth) (SGAA) – whether the obligation to pay superannuation contributions ‘in accordance with’ the SGAA incorporated the ‘maximum contribution base’ per section 19(3) of the SGAA.

Commissioner of Taxation v Racing Queensland Board [2019] FCAFC 224
 SUPERANNUATION – whether principal racing authority liable to pay superannuation guarantee charges – construction of s 12 of Superannuation Guarantee (Administration) Act 1992 (Cth) – whether principal racing authority is “employer” of jockeys – whether principal racing authority liable to pay riding fees to jockeys – where principal racing authority stated that it would pay jockeys – where principal racing authority in fact paid jockeys – where principal racing authority prepared recipient created tax invoices reflecting liability to pay – whether payments made “on behalf of” another person – where amounts paid not reimbursed by another person
APPEAL AND NEW TRIAL – whether appellable error in approach to evidence adduced on appeal from objection decision – where evidence of past events not adduced from contemporaneous witnesses – relevance of evidence relating to arrangements prior to the relevant period. Superannuation Guarantee (Administration) Act 1992 (Cth) ss 11, 12, 16, 17 and 19 Superannuation Guarantee Charge Act 1992 (Cth) ss 5 and 6

Commissioner of Taxation v Scone Race Club Limited [2019] FCAFC 225
 SUPERANNUATION – whether respondent race club was liable to pay a superannuation guarantee charge in respect of riding fees paid to jockeys during the relevant period – whether jockeys engaged to ride in races or barrier trials were employees of the respondent race club within the extended definition in s 12(8)(a) of the Superannuation Guarantee (Administration) Act 1992 (Cth) – whether the primary judge erred in holding that the respondent race club discharged its burden to show it was not “liable” to pay riding fees to jockeys engaged by owners or trainers – appeal allowed
TAXATION – appeal from objection decision in the Court’s original jurisdiction under s 14ZZ of the Tax Administration Act 1953 (Cth) – whether the primary judge impermissibly reversed the onus of proof under s 14ZZO(b)(i)

Commissioner of Taxation v The Trustee for the Michael Hayes Family Trust [2019] FCAFC 226
TRUSTS – construction of trust deed – relevance of surrounding circumstances – ambiguity – mistake – where trust deed identified a named company “as trustee for” a specified superannuation fund as the “Second Absolute Beneficiary” of the trust – where the named company had in fact ceased to be the trustee of the superannuation fund – where a deed of rectification purported to rectify the trust deed as and from the establishment of the trust – whether the reference to the named company is a case of ambiguity or mistake – whether construction of the trust deed is to be undertaken having regard to evidence of surrounding circumstances Superannuation Industry (Supervision) Act 1993 (Cth) s 45

Legislation

Commonwealth

Regulation

Treasury Laws Amendment (Miscellaneous Amendments) Regulations 2019
17/12/2019 - These regulations make minor and technical amendments to multiple regulations in the Treasury portfolio, including superannuation laws - Schedule 5—Superannuation
Part 4—Life expectancy period - Superannuation Industry (Supervision) Regulations 1994 
Part 5—Application - Income Tax Assessment Regulations 1997; Superannuation Industry (Supervision) Regulations 1994 

Superannuation (Unclaimed Money and Lost Members) and Other Laws (Repeal and Consequential Amendments) Regulations 2019
16/12/2019 - These regulations repeal the Superannuation (Unclaimed Money and Lost Members) Regulations 1999 and make minor consequential amendments related to the repeal of these regulations.

Superannuation (Unclaimed Money and Lost Members) Regulations 2019
16/12/2019 - These regulations remake and improve the operation of the Superannuation (Unclaimed Money and Lost Members) Regulations 1999 before they sunset.

Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this newsletter is accurate at the date it is received or that it will continue to be accurate in the future.

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