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Inside track: Superannuation, Funds Management & Financial Services

15 July 2019

#Superannuation, Funds Management & Financial Services

Inside track: Superannuation, Funds Management & Financial Services

In the media

ASIC targets licensees over lack of AFCA membership
Over 50 financial services and credit licensees have had their licenses formally suspended or cancelled by the Australian Securities and Investments Commission (ASIC) after failing to obtain membership of the Australian Financial Complaints Authority (AFCA)(12 July 2019).  More... 

AFCA reminds insurance companies to focus on fairness
The AFCA has reminded insurance companies that complaints it receives will be assessed on how fairly the company treats its customers. The reminder comes in response to media reports that consumers have been denied insurance or have been asked to undertake genetic testing (11 July 2019).  More... 

Grattan Institute contradicts itself on super claims
The Grattan Institute has been caught out contradicting itself in its attempts to undermine the superannuation guarantee ( 10 July 2019).  More...  

ASIC consults on remaking class order on departed former temporary residents’ superannuation
ASIC released a consultation paper about whether it should remake a class order that provides conditional relief to superannuation trustees (10 July 2019).  More... 

ASIC consults on proposal to intervene to stop consumer harm in short term credit
ASIC has released a consultation paper (CP 316) on the first proposed use of its new product intervention power. In its first proposed deployment of this power, ASIC is targeting a model involving a short term credit provider and its associate who charge fees under separate contracts (09 July 2019 ).  More... 

ASIC boosts AFSL application requirements
ASIC has altered the procedure it uses to assess Australian Financial Services Licence applicants, with many now required to provide more historic information to the corporate regulator (08 July 2019 ).  More... 

ASIC accepts court enforceable undertakings from CBA and ANZ over superannuation product distribution
ASIC has accepted court enforceable undertakings from the Commonwealth Bank of Australia and Australia and New Zealand Banking Group under which the banks have agreed to change the way they distribute superannuation products to their customers (06 July 2018).  More... 

ASIC requires compliance with restrictions on use of ‘independent’
ASIC is continuing to monitor the financial advice industry’s use of restricted terms ‘independent’ and ‘independently owned’, taking steps to intervene when it identifies concerns. Following surveillance of industry websites, ASIC has required four financial advice companies to cease and amend false claims of independence that could mislead consumers (05 July 2019).  More... 

ASIC cancels AFS licence of Australasia Wealth Services and Management
AWSM breached its financial reporting and audit obligations, as well as the requirement to obtain membership of the Australian Financial Complaints Authority (AFCA)(05 July 2019). More... 

ASIC to offer AFSL relief to overseas firms
ASIC has opened consultation on its proposal to scrap the need for foreign providers of funds management services to professional investors to hold an Australian Financial Services Licence (04 July 2019).  More... 

Whistleblowers given new protection
From July 1 2019, whistleblowers who report misconduct about companies and company officers have more rights and stronger protections. Large proprietary companies, public companies, and corporate trustees of registrable superannuation entities are now required to have a whistleblower policy in line with the changes (03 July 2019).  More... 

New regime for corporate whistleblower protections has commenced
From July 1, whistleblowers who report misconduct about companies and company officers can access stronger rights and protections in the Corporations Act 2001 (01 July 2019).  More...

Proposed amendments to the protecting your super legislation will deliver better outcomes
ASFA says proposed amendments to the Protecting Your Super legislation flagged by Government are a positive step for consumers. ASFA also welcomes the announcement by the Assistant Minister for Superannuation Jane Hume, confirming that the Government will proceed with the deferral of the extension of SuperStream to SMSF rollovers from 30 November 2019 to 31 March 2021 (01 July 2019 ).  More...  

SMSF rollovers in SuperStream to be deferred
The Morrison Government is proceeding with the deferral of the extension of SuperStream to self-managed superannuation fund (SMSF) rollovers from 30 November 2019 to 31 March 2021 (28 June 2019).  More...  
New measures to protect your superannuation: commencing 1 July 2019
Commencing on 1 July 2019, the Protecting Your Superannuation Act will safeguard Australians’ superannuation savings from excessive fees, unnecessary insurance and the costs of inadvertently holding multiple superannuation accounts (28 June 2019).  More...  
ASIC ‘fees-for-service’ bill passes
The government has passed legislation that will see fees for ASIC's licensing services increased to better reflect the regulator's "actual costs", according to Minister for Revenue and Financial Services Kelly O'Dwyer. The so-called 'fees-for-service' bill accompanies the industry funding legislation, which was passed on 15 June 2017 and requires regulated entities to pay an annual levy (28 June 2019).  More... 

In practice and courts

ASIC Information Sheet 240 AFS licensing – Requirements for certain applicants to provide further information
This provides guidance to applicants on recent changes to ASIC’s Australian financial services (AFS) licensing assessment procedures. These changes apply to: applicants that are proposing to offer certain financial services or to operate in specific circumstances (05 July 2019).  More... 

New prices for ASIC regulatory services
The fees ASIC charges for specific regulatory activities have changed to reflect the actual cost to ASIC associated with the work. In most cases this has resulted in a fee increase. The Government passed required legislation on 28 June 2018. New pricing is effective 4 July 2018. ASIC's ‘fees for service’ impact a range of industry stakeholders including Australian credit licensees, Australian financial services (AFS) licensees, market infrastructure providers, responsible entities, registered liquidators, and companies (06 July 2018).  More... 

ASIC: New regime for corporate whistleblower protections commences 01 July
To provide guidance to whistleblowers on their rights and protections and how ASIC handles their reports, ASIC has updated information on our website and issued two new information sheets:
Information Sheet 238 Whistleblower rights and protections (INFO 238)
Information Sheet 239 How ASIC handles whistleblower reports (INFO 239)
(01 July 2019)

Reminder: Reforms to the corporate whistleblower protection regime
From 1 July 2019, the whistleblower protections in Part 9.4AAA the Corporations Act 2001 (Corporations Act) will be expanded to provide greater protections for whistleblowers who report misconduct about companies and company officers. The reforms are contained in the Treasury Laws Amendment (Enhancing Whistleblower Protections) Act 2019, Check out Your Call’s Whistleblower Policy Review Checklist for best practice and good governance regarding whistleblowing programs.

AASB invitation to comment
ITC 40 Financial Instruments with Characteristics of Equity – The International Accounting Standards Board has recently published Discussion Paper DP/2018/1 Financial Instruments with Characteristics of Equity. Submissions to the IASB were due by 7 January 2019.    More... 

IASB proposed amendments to IFRS 3 Business Combinations 
The amendments would update a reference to the Conceptual Framework for Financial Reporting without changing the accounting requirements for business combinations. IFRS 3 specifies how a company should account for the assets and liabilities it acquires when it obtains control of a business. View the Exposure Draft Reference to the Conceptual Framework. Submit your comment letters here. Comments close on 27 September 2019.

ASIC consultation: foreign financial services providers relief proposals
CP 301 sets out a proposal to enable foreign providers to apply for a modified form of Australian financial services (AFS) licence (foreign AFS licence). This follows ASIC’s review of the regulatory settings behind our foreign providers relief. The current foreign provider licensing relief were due to sunset on 27 September 2018, will be extended until 30 September 2019 while we consult with stakeholders. SIC invites submissions on CP 301 by 31 July 2018.

Reminder: APRA prepares for new laws granting approval powers for changes in control of superannuation licensees
APRA has released for consultation a draft form and guide for applications to acquire a controlling stake in a registrable superannuation entity (RSE) licensee. From 5 July, any party seeking to acquire greater than a 15 per cent stake in an RSE licensee must apply to APRA for approval).   More...

Here's how super is changing on July 1 explainer
Big changes to superannuation regulations were passed through parliament earlier this year and are set to come into effect in the next few weeks. Super funds should have contacted you about the changes but if you want to know more, read about the new rules here

AASB: Fatal-Flaw Review Draft: Proposed Standard Amendments to Australian Accounting Standards –Implementation of AASB 1059
This proposed Standard would amend the transitional relief available to grantors when implementing AASB 1059 Service Concession Arrangements: Grantors.  Comments were due 17 July 2019.  More... 

Exposure Draft ED 289: Annual Improvements to Australian Accounting Standards 2018–2020
ED 289 proposes to amend AASB 1 First-time Adoption of Australian Accounting Standards, AASB 9 Financial Instruments, AASB 16 Leases and AASB 141 Agriculture. Annual improvements are limited to changes that either clarify the wording in the Standard or correct relatively minor unintended consequences, oversights or conflicts between requirements in the Standards. Submit your comments to the AASB by 31 July 2019 via the AASB website here.

ASIC CP 300 Approval and oversight of compliance schemes for financial advisers
The proposals in CP 300 Approval and oversight of compliance schemes for financial advisers are outline here. We intended to release a regulatory guide setting out our final policy by the end of September 2018. 

FSC Submissions
02 July 2019 - FSC Submission - Proposed Revisions to Prudential Standard SPS 515 - 30th May 2019

AFCA consults on rule changes to identify financial firms in published determinations
AFCA has drafted changes to Rule A.14.5 that will enable us to identify financial firms in published determinations. This will apply to determinations issued after the changes take effect, subject to the changes being approved by ASIC. It is anticipated that the Rules will be released after 1 July 2019.  More...  

Australian Financial Complaints Authority (AFCA) reminder
From 1 July 2019, Australian consumers and small business will be able to lodge complaints with AFCA about the conduct of financial firms dating back to 1 January 2008. AFCA will accept complaints from 1 July 2019 and follow the usual practice of referring them back to the financial firms to resolve them.

Current AFCA matters – July 2019
Digital Rebl Pty Ltd and Media Rebl Pty Ltd
Forex Capital Trading Pty Ltd
AGM Markets Pty Ltd
Berndale Capital Securities Pty Ltd
Bestjet Travel Pty Ltd (Bestjet)
Viewble Media and The Shoppers Network

ISA reports
10 July 2019 - UMR Stapling Report - Views on the Stapling of Default Funds

Gazette - Superannuation Industry (Supervision) Act 1993
Notice of Disqualification - Antonio De Luca;  Aldo De Luca

Notice of Disqualification - Renee Mengler

Notice of Disqualification - Dale Cooper


The Sharemarket College Pty Ltd and Australian Securities and Investments Commission [2018] AATA 1969
CORPORATIONS – cancellation of Australian Financial Services Licence – whether breaches of conditions of Australian Financial Services Licence – banning order from providing financial services – breaches of financial services laws – telemarketing – email marketing – where systemic failures in compliance regime – ill-health mitigating factor. 

Anderson v Patersons Securities Ltd [2019] NSWSC 852
COSTS — Security for costs — Relevant factors – whether the jurisdiction to make an order for security for costs pursuant to r 42.21(1)(a) of the UCPR is enlivened –whether as a matter of fact the plaintiff is not ordinarily resident in Australia
COSTS — Security for costs — Relevant factors – whether in the exercise of the Court’s inherent jurisdiction or pursuant to r 42.21(1)(e) of the UCPR the discretion to award security of costs should be exercised in favour of the defendants – consideration of the plaintiff’s impecuniosity, delay and costs
The first defendant, Patersons Securities Ltd (Patersons), is a stockbroking and financial services firm

Carpenders Park Pty Ltd (as trustee of the Carpenders Park Pty Ltd Staff Superannuation Fund) v Sims Metal Management Limited [2019] FCA 1040
PRACTICE AND PROCEDURE – representative proceeding under Part IVA of the Federal Court of Australia Act 1976 (Cth) – application for common fund order – where notices sent to all potential group members – where no effective objection received – where funder proposed interim common fund order with cap on its commission of a maximum of 25% of net proceeds after paying lawyers’ costs and deferred costs subject to later order – whether interim order with cap creates any expectation of later exercise of discretion under s 33ZF of the Federal Court Act to make final common fund order with same cap at conclusion of proceeding – whether Court should approve common fund order on such terms

Dimitropoulos and Australian Securities and Investments Commission [2019] AATA 1775
PRACTICE AND PROCEDURE – Administrative Appeals Tribunal Act s 37(2) – application for notice requiring lodgement of witness statement instructions and draft witness statement – general assertions of relevance to witness credit – scope of the "may be relevant" criterion – relevance of decision maker's obligation to lodge relevant documents – discretion not to require lodgement of potentially relevant documents
Administrative Appeals Tribunal Act 1975 (Cth) ss 33, 35, 37, 38AA, 40B
Corporations Act 2001 (Cth) ss 761A, 763A, 766A, 911A, 913B, 920A, 920B, 1311
Freedom of Information Act 1982 (Cth)
National Consumer Credit Protection Act 2009 (Cth) ss 80, 81, 253, 259 (h) during the client interviews the sales consultants would obtain details of the client’s financial position, including details of their current  superannuation  balances. Depending on the amount of those balances, the sales consultants would go through the “presentation” document, and the house and land contracts, with the client. Often clients would agree to the SMSF establishment and property purchase proposal during such an initial interview, and would complete the kind of authority forms

Jacobs and Commissioner of Taxation (Taxation) [2019] AATA 1726
TAXATION –  superannuation  excess transfer balance tax liability – whether discretion to waive – decision under review affirmed. Superannuation (Excess Transfer Balance Tax) Imposition Act 2016  (Cth)

Practice and procedure - Application for pre-action discovery - Turns on own facts
Rules of the Supreme Court 1971 (WA)
Superannuation Industry (Supervision) Act 1993  (Cth)
Superannuation Industry (Supervision) Regulations 1994  (Cth)



Treasury Laws Amendment (Putting Members’ Interests First) Bill 2019
Introduced HR 04/07/2019 - A Bill for an Act to amend the law relating to superannuation, and for related purposes - This Bill contains amendments to the SIS Act to protect individuals’ retirement savings from erosion, ultimately increasing Australians’ superannuation balances.

Treasury Laws Amendment (2018 Measures No. 2) Bill 2019
HR Introduced and read a 1st time  and 2nd time 04/07/2019 - Schedule 1to this Bill amends the Corporations Act 2001 and National Consumer Credit Protection Act  2009 to expand the regulation-making powers to allow the regulations to provide for exemptions from the Australian Financial Services Licence and Australian Credit Licence requirements for the purposes of testing financial and credit products and services under certain conditions.


Accounting Standard AASB 2019-1 Amendments to Australian Accounting Standards – References to the Conceptual Framework
09/07/2019 – This instrument makes amendments to Australian Accounting Standards, Interpretations and other pronouncements to reflect the issuance of the Conceptual Framework (Conceptual Framework) by the Australian Accounting Standards Board.

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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