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Inside track: Superannuation, Funds Management & Financial Services

06 September 2021

#Superannuation, Funds Management & Financial Services

Inside track: Superannuation, Funds Management & Financial Services

In the media

Check on superannuation trustee preparedness for new IDR requirements finds more work required
ASIC – 02 September 2021 – a recent ASIC survey of registrable superannuation entities (trustees) about their preparedness for the new enforceable internal dispute resolution obligations has identified some important areas requiring further work. View the Summary of the survey findings.  More...

New law set to make it easier for victim-survivors of family violence to get their fair share of super entitlements
AIST – 02 September 2021 – the Australian Institute of Superannuation Trustees, Women in Super, HESTA and Women’s Legal Service Victoria have welcomed the passage through Parliament of legislation that will help stop family violence perpetrators from hiding superannuation assets in family law proceedings.  More...

APRA releases inaugural Your Future, Your Super Performance Test Results
APRA – 31 August 2021 – the APRA has released the results from the inaugural MySuper Product Performance Test. APRA has assessed 76 MySuper products with at least 5 years of performance history against the objective benchmark. A total of 13 products failed to meet the objective benchmark.
Note: Trustees of failed products are required to write to members by 27 September 2021 advising them of their Performance Test outcome and providing the details of the ATO’s YourSuper comparison tool: YourSuper comparison tool.  More...

First step on performance testing but increased focus needed on the “poorer-performing end of spectrum”
AIST – 31 August 2021 – the AIST notes the release of new performance data for default MySuper products, but remains concerned that millions of Australians will be unaware they are in underperforming and untested super products that aren’t as yet covered by the new laws.  More...

ASFA urges consumers to treat YFYS benchmark results with extreme caution
ASFA – 31 August 2021 – the ASFA has urged consumers to exercise caution in how they interpret the results of the Your Future, Your Super performance test and to think carefully before making important decisions about their superannuation.  More...

13 MySuper products fail YFYS performance test
MEDIA – 31 August 2021 – APRA has intensified its supervision of trustees with products that failed the test and has requested they provide a report identifying the causes of their underperformance and how they plan to address them. Trustees have to monitor their products closely and report important information to APRA.  More...

ASIC affordable advice project on hold due to SDB
MEDIA – 30 August 2021 – the Australian Securities and Investments Commission’s (ASIC) CP 332 ‘Promoting access to affordable advice for consumers’ project has been put on hold as issues over funding the single disciplinary body meant ASIC is unsure what it can commit to either project.  More...

Temporary and targeted relief on ASIC levies for financial advisers
TREASURY – 30 August 2021 – the Morrison Government is announcing temporary and targeted relief for financial advisers by reducing the cost recovery levies charged by the ASIC. Treasury will also review the ASIC Industry Funding Model while this temporary relief is in place, to ensure it remains fit for purpose in the longer term given structural changes taking place in the advice industry.  More...

Ex-adviser faces criminal charges for ban breach
MEDIA – 27 August 2021 – the corporate regulator alleges former financial adviser Lawrence Toledo breached a ban that was in response for not acting in clients’ best interest.  More...

APRA releases final remuneration standard
MEDIA – 27 August 2021 – after an “extensive consultation process” which began in 2019, the prudential regulator states that its Prudential Standard CPS 511 Remuneration is a “milestone” in strengthening remuneration practices across the banking, insurance and superannuation sectors. The standard will come into effect from 1 January 2023.  More...

Advisers unlikely to be ruled against in ‘know your client’ complaint
MEFIA – 27 August 2021 – there is a strong likelihood that complaints regarding inappropriate advice will be resolved by agreement rather than a decision against the advisers, according to the Australian Financial Complaints Authority.  More...

New Statement of Expectation for the Australian Securities and Investments Commission
TREASURY – 26 August 2021 – a new Statement of Expectations for the Australian Securities and Investments Commission (ASIC) has been released, outlining the Government’s priorities for, and expectations of ASIC. A strong and effective ASIC is essential for the efficient operation of Australia’s financial and corporate sectors for the benefit of households and businesses.  More...

APRA’s new Corporate Plan focuses on protecting today, while preparing for tomorrow
APRA – 26 August 2021 – the APRA has published an updated Corporate Plan outlining how it intends to ensure the ongoing strength and resilience of the Australian financial system over the next four years.  More...

NAB to pay $18.5 million penalty for fee disclosure statement failures
ASIC – 26 August 2021 – the Federal Court has ordered National Australia Bank Limited (NAB) to pay an $18.5 million penalty for failures relating to misleading fee disclosure statements. The Court also declared NAB contravened its obligations as an Australian financial services licence holder to act efficiently, honestly and fairly.  More...

General and personal advice a concern in Retirement Income Covenant
MEDIA – 26 August 2021 – in its submission on the covenant, KPMG has raised concerns for trustees relating to the difficulty in navigating the divide between general and personal financial product advice and say trustees should be exempt.  More...

Clarity needed on anti-hawking ‘offer’ definition
MEDIA – 24 August 2021 – the corporate regulator needs to clarify on what constitutes as an offer as there is a contradiction in its regulatory guide and consultation paper, according to the Australian Institute of Superannuation Trustees.  More...

FSC collaborates with advice sector on advice fee consent and independence disclosure
FSC – 24 August 2021 – it seems almost every day now that a new regulation prescribing another form of disclosure is being piled onto the advice sector.  More...

Westpac subsidiaries to pay $10.5 million penalty for breaches of best interests duty
ASIC – 24 August 2021 – the penalty follows the High Court's unanimous decision on 3 February 2021 that Westpac Securities and BT Funds breached their best interests duty when they provided personal financial product advice in calls made to 14 customers, despite neither firm being licensed to provide personal advice.  More...

In practice and courts

ASIC updates
26/08/2021 ASIC Corporate Plan 2021–25 – Focus 2021–22
Outlines ASIC's priorities over the next four years to achieve a fair, strong and efficient financial system for all Australians: See 21-225MR, ASIC's new Statement of Intent and the Australian Government's Statement of Expectations (26 August 2021).

ASIC Corporations (Amendment) Instrument 2021/381
Amends the ASIC Corporations (Auditor Independence) Instrument 2021/75 and ASIC Corporations (Parent Entity Financial Statements) Instrument 2021/195 to change the repeal dates from April 2026 to April 2024.

ASIC Corporations (COVID-19 – advice-related relief) Instrument 2021/268
Extends until 15 October 2021 the relief measure that allows financial advisers to provide a record of advice rather than a statement of advice to existing clients requiring financial advice due to the impact of the COVID-19 pandemic: See 21-072MR and FAQs.

ASIC consultation: Draft guidance for the hawking reforms
ASIC’s guidance gives additional clarity on how the changes may affect commercial practices, systems and processes. All interested stakeholders have until 17 August to provide feedback on CP 346. ASIC will publish its final guidance in September 2021, ahead of the revised hawking prohibition commencing on 5 October 2021.  More...

ASIC consultations: CP 340 breach reporting and related obligations
This consultation paper set out our proposals for providing guidance to Australian financial services licensees and Australian credit licensees (credit licensees) on the breach reporting obligation that applies from 1 October 2021. The obligations require these licensees to notify, investigate and remediate breaches of the law in certain circumstances.  More...

APRA quarterly MySuper statistics June 2021
The APRA has released its Quarterly MySuper Statistics report for the June 2021 quarter. Copies of this publication are available on the APRA website at: Quarterly superannuation statistics (31 August 2021).
Copies of this publication are available on the APRA website here.

APRA releases superannuation statistics for June 2021
The APRA has released its Quarterly Superannuation Performance publication for the June 2021 quarter.
Key statistics for the superannuation industry as at 30 June 2021 are outlined here (24 August 2021).  More...

APRA frequently asked questions on Your Future, Your Super performance test
The APRA has released a set of frequently asked questions (FAQs) to provide general and technical guidance on the Government’s Your Future, Your Super performance test. The FAQs are available on the APRA website at: Your Future, Your Super Frequently Asked Questions (25 August 2021).

SMSF Association Submissions
13/08/2021 SMSF Association Submission – Compensation Scheme of Last Resort

AIST Submissions
AIST submission: Response to Superannuation Portfolio Holdings Disclosure consultation
31 August 2021 – AIST proposes specific changes to the Regulations to ensure disclosure does not prejudice members best financial interests.
AIST Submission: Strengthening Australia’s cyber security regulations and incentives
27 August 2021 – the current regulatory settings in the superannuation sector can respond to emerging cyber related governance risks.

Cases

Brady v NULIS Nominees (Australia) Limited in its capacity as trustee of the MLC Super Fund [2021] FCA 999
PRACTICE AND PROCEDURE – representative proceeding under Part IVA of the Federal Court of Australia Act 1976 (Cth) – application by respondent for appointment of sample group member – where issues to be resolved at trial include whether a group member whose entitlement to access their benefits at the relevant time had not vested could have suffered loss – whether appointment of sample group member necessary to avoid requiring determination of a hypothetical and advisory question – where applicant’s entitlement to access their benefits had vested at the relevant time – where risk of determination of a hypothetical and advisory question if no sample group member appointed – application allowed.

Legislation

Commonwealth

Bills

Treasury Laws Amendment (2021 Measures No. 7) Bill 2021
27/08/2021 – a Bill for an Act to amend the law relating to taxation and superannuation, and for related purposes
Schedule 2 – transitional provisions relating to the repeal of the Superannuation (Resolution of Complaints) Act 1993
Schedule 2 to the Bill amends the AFCA Act to facilitate the closure and any transitional arrangements associated with AFCA replacing the SCT. 

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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