Current legislative and regulatory affairs

Legislation before parliament

Corporations Amendment (Streamlining Advice Process) Bill 2024

The Corporations Amendment (Streamlining Advice Process) Bill 2024 (the Bill) introduces new requirements for financial services licensees and their representatives. Section 944A This Division applies in relation to the provision of personal advice (the advice) to a person (the client) as a retail client by:

(a) a financial services licensee (the providing entity); or

(b) a person (the providing entity) in their capacity as an authorised representative of one or more financial services licensees (the authorising licensees)

Key Amendments: Division 3 of Part 7.7: Documentation Requirements *known collectively as “personal advice documents” Obligation to prepare and keep a letter of engagement, a record of advice and a document about conflicts of interest.

Letter of Engagement: Outlines the scope of advice agreed with the client.
Record of Advice: Includes the reasons for the advice, the recommended strategy, and its relevance to the agreed scope.
Conflict of Interest Document: Details any remuneration or benefits that could influence the advice, as well as other interests and relationships. The term benefits is wide and can include any other interests, whether pecuniary or not and whether direct or indirect.

Obligations

Provision of Documents: Before providing advice, the client must receive and sign the letter of engagement and receive the record of advice and conflict of interest document.
Qualified Privilege: Providing entities have qualified privilege for statements made in compliance with the division.

Status of legislation: Before the House of Representatives. Second reading moved 4 November 2024.

Family Law Amendment Bill 2024

This Bill will primarily amend the Family Law Act 1975 (Family Law Act), to make the family law system simpler and safer for separating couples to navigate and ensure property and financial aspects of the relationship are resolved safely and fairly.

The Bill:

allows domestic and family violence to be considered by a court in property settlements.

makes amendments to explicitly recognise economic or financial abuse as a form of family violence and provides examples, including forcibly controlling finances, including superannuation, and sabotaging employment or income-earning potential.

inserts a new regulation-making power for prescribing methods and factors for valuations of super that may be subject to a splitting order, and a penalty regime for trustee non-compliance with a review direction.

Status of legislation: Before the Senate. Second reading moved 11 September 2024.

Superannuation (Better Targeted Superannuation Concessions) Imposition Bill 2023

Introduced with the Treasury Laws Amendment (Better Targeted Superannuation Concessions and Other Measures) Bill 2023, the bill imposes a tax rate of 15 per cent for superannuation earnings corresponding to the percentage of an individual’s superannuation balance that exceeds $3 million for an income year. Referred to Committee 7 December 2023. Senate Economics Legislation Committee report tabled 10 May 2024. The committee recommended the passage of the Bills.

Status of legislation: Before the Senate. Second reading moved 10 October 2024.

Superannuation (Objective) Bill 2023

Enshrines the objective of superannuation in legislation and requires a statement of compatibility to be included in the explanatory materials accompanying bills and regulations relating to superannuation. Senate Economics Legislation Committee Report published March 2024

Status of legislation: Before the Senate. Second reading moved 20 March 2024.

Privacy and Other Legislation Amendment Bill 2024

The Privacy and Other Legislation Amendment Bill 2024 (the Bill) would implement 23 of the 25 legislative proposals that were agreed by the Government in its September 2023 Response to the Privacy Act Review. The Office of the Australian Information Commissioner (OAIC), Australia’s national privacy regulator, would have access to a broader range of enforcement options, as well as new functions and capabilities. This Bill provides that entities may handle personal information in a manner that would otherwise not be permitted under the APPs when it is necessary to assist individuals in emergencies and following significant data breaches.

The Minister would also have the power to issue a declaration that would enable the sharing of personal information with appropriate entities where it is necessary or appropriate to prevent or reduce the risk of harm to individuals in the event of an eligible data breach. The Bill would provide individuals with a cause of action in tort for serious invasions of privacy.

Status of legislation: Before the House of Representatives. Third reading agreed to 6 November 2024.

Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024

This Bill would reform Australia’s anti-money laundering and counter-terrorism financing regime, which is comprised of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (the AML/CTF Act), the Anti-Money Laundering and Counter- Terrorism Rules Instrument 2007 (No.1) (the AML/CTF Rules) and associated regulations, and would repeal the Financial Transaction Reports Act 1988 (FTR Act).

Status of legislation: Before the Senate. Second reading moved 10 October 2024.

Cyber Security Bill 2024

The Cyber Security Bill 2024 (the Bill) provides a legislative framework for contemporary whole-of-economy cyber security issues. The Bill when enacted will provide additional protections to Australian people and businesses, build mitigations for extant cyber risks, and improve the Government’s visibility of the threat environment to inform protections, incident response procedures, and future policy through various measures. Measures relevant to super funds are:

Introducing a mandatory reporting obligation requiring entities that meet a specified threshold to report to the Department of Home Affairs if they make a ransomware or cyber extortion payment of money or an in-kind benefit in connection with a cyber security incident. Current voluntary reporting mechanisms are under-utilised and consequently, ransomware and cyber extortion attacks remain significantly underreported. The Australian Institute of Criminology (AIC) indicates that only one in five victims of a ransomware attack report the attack. As a result, government lacks visibility of the economic and social impact of ransomware in Australia.

Establishing a ‘limited use’ obligation that restricts how cyber security incident information provided to the National Cyber Security Coordinator during a cyber security incident can be used and shared with other government agencies, including regulators. ASD has observed that cyber security incident reporting and engagement between industry and the Government during a cyber security incident has plateaued. This suggests an overall reduction in comprehensive and/or timely reporting and engagement between industry and the Government, limiting the help the Government can offer in responding to a cyber security incident and harming cyber security outcomes for Australia and

Establishing a Cyber Incident Review Board to conduct post-incident reviews into significant cyber security incidents. The Bill establishes the Board as an independent, advisory body with a clear remit to conduct no-fault, post-incident reviews of significant cyber security incidents in Australia. Following such a review, the Board will also disseminate recommendations to both Government and industry to strengthen Australia’s collective cyber resilience. This is particularly important for driving constant improvement within both the public and private sectors as cyber-enabled interference grows. To effectively carry out these functions, the Board will be enabled with limited information gathering powers to compel information from entities involved in the cyber security incident under review, only where voluntary requests for information have been unsuccessful.

Status of legislation: Before the House of Representatives. Second reading moved 9 October 2024.

Security of Critical Infrastructure and Other Legislation Amendment (Enhanced Response and Prevention) Bill 2024

The Security of Critical Infrastructure and Other Legislation Amendment (Enhanced Response and Prevention) Bill 2024 (the Bill) will amend the Security of Critical Infrastructure Act 2018 (the SOCI Act), to give effect to the legislative reforms outlined under Shield 4 of the 2023-2030 Australian Cyber Security Strategy.

The SOCI Act amendments aim to:

expand the definition of all types of critical infrastructure assets to include secondary assets which hold ‘business critical data’ and relate to the functioning of the primary asset;

facilitate the use of a ‘last resort’ directions power for the Secretary of the Department of Home Affairs, when authorised by the Minister, for the purposes of managing both multi-asset incidents and the consequences of serious incidents which could have, are having, or have had, a ‘relevant impact’ on one or more critical infrastructure assets;

clarify the operation of the secrecy and disclosure provisions—in particular to enable greater intra-government sharing of protected information and cross-industry collaboration, and reduce unnecessary burden of these provisions on entities in the ordinary conduct of business;

create a directions power for the Secretary of the Department of Home Affairs or the relevant Commonwealth regulator which is exercisable where it has been identified a critical infrastructure risk management program is seriously deficient; and

bring appropriate elements of the Telecommunications Sector Security Reforms (TSSR) administered by the Home Affairs portfolio, including security and notification obligations, from Part 14 of the Telecommunications Act 1997 into the SOCI Act, with enhancements to align the regulatory frameworks and clarify telecommunications-specific obligations.

The Bill also amends Part 6A of the SOCI Act to strengthen the integrity of information in respect of an asset that is or becomes a system of national significance (SoNS). Notification of changes under Part 6A will be communicated to the responsible entity only (see section 12L of the SOCI Act, which sets out the responsible entity for different assets), with obligations relating to SoNS notification removed for direct interest holders.

Status of legislation: Before the House of Representatives. Second reading moved 9 October 2024.

Historical legislative and regulatory affairs
Paid Parental Leave Amendment (Adding Superannuation for a More Secure Retirement) Bill 2024
The Bill will add a superannuation contribution to the Commonwealth-funded Paid Parental Leave Scheme . The Bill also makes a minor technical amendment to the Fair Work Act 2009 (FWA 2009) relating to unpaid parental leave.
Status of legislation: Received Royal Assent 1 October 2024.

Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024
The bill introduces two broad reforms. The first reform introduces a crisis management and resolution regime for Australia’s financial market infrastructure. Alongside this, the bill enhances the licencing, supervisory and enforcement powers of the Australian Securities and Investment Commission (ASIC) and the Reserve Bank of Australia (RBA), as well as making changes to roles and responsibilities of the Minister, the RBA and ASIC.
The second reform introduces mandatory climate-related financial disclosures for entities that meet one of the following requirements:
(a)the entity is required to lodge financial reports under Chapter 2M of the Corporations Act 2001 (the Corporations Act) and meets certain size requirements; or
(b)the entity has emissions reporting obligations under the National Greenhouse and Energy Reporting (NGER) scheme. These new disclosures will require the entities in question to make climate disclosures relevant to the sustainability standards made by the Australia Accounting Standards Board (AASB).
Senate Economics Legislation Committee issued its report on the Bill: Committee report 3 May 2024. The committee recommended that the Bill be passed.
Status of legislation: Received Royal Ascent 17 September 2024.

Net Zero Economy Authority Bill 2024
The Bill proposes to establish the Net Zero Economy Authority. The Climate Change Act 2022 sets out Australia’s commitment to reducing net greenhouse gas emissions to 43 per cent below 2005 levels by 2030 and to zero by 2050. All levels of government, and the private sector, will need to work in a more coordinated way to catalyse the investment needed to support the decarbonisation of existing emissions-intensive industries, support the establishment of new industries and the creation of new jobs and other opportunities arising from the net zero transformation. The NZEA Bill would create a new government entity with the mandate, functions and powers that enable it to ensure that Australia’s transition to net zero emissions is orderly and positive. The Authority’s functions include:
consulting and cooperating with persons, organisations, and governments to support Australia’s transition to a net zero emissions economy; and
facilitating public and private sector participation and investment in net zero transformation initiatives, including referring matters to specialist investment vehicles and other entities; and
supporting workers in emissions-intensive industries to access new employment or improve their employment prospects; and
supporting and delivering educational and promotional initiatives to promote an understanding of, and encourage participation in, Australia’s transition to a net zero emissions economy.
Referred to the Senate Finance and Public Administration Legislation Committee. Report tabled 13 May 2024. The committee recommends that the bills be passed as soon as practically possible.
Status of legislation: Received Royal Assent 17 September 2024.

Digital ID Bill 2023
Introduced with the Digital ID (Transitional and Consequential Provisions) Bill 2023, the bill: establishes an accreditation scheme for entities providing digital ID services; expands the Australian Government Digital ID System; and provides for privacy safeguards and a range of governance arrangements, including establishing the Australian Competition and Consumer Commission as the Digital ID Regulator and expanding the role of the Information Commissioner to regulate privacy protections for digital IDs. The Bill aims to provide individuals with secure, convenient, voluntary and inclusive ways to verify their identity for use in online transactions with government and businesses that use digital ID.
Status of legislation: Received Royal Assent 30 May 2024. The Act will commence by 1 December 2024.

Attorney-General’s Portfolio Miscellaneous Measures Bill 2023
Amends the Australian Securities and Investments Commission Act 2001, Corporations Act 2001, Judiciary Act 1903, National Consumer Credit Protection Act 2009 and Superannuation Industry (Supervision) Act 1993 to confer jurisdiction on the Federal Court of Australia to hear and determine a range of summary and indictable offences relating to conduct within the remit of the Australian Securities and Investments Commission.
It will insert new section 201A into the SIS Act to confer jurisdiction on the Federal Court to hear and determine a range of indictable offences under this section, including relating to victimisation against certain superannuation entity trustees; knowingly acting as trustee, investment manager of custodian, or as a responsible officer of body corporate who is fulfilling one of these roles, of a superannuation entity while disqualified; issuing or offering, or participating in the issuing or offering of, superannuation interests in public offer entities when not allowed; intentionally or recklessly refusing or failing to comply with certain requirements made by ASIC under the SIS Act; and concealing books relevant to an ASIC investigation.
Status of legislation: Passed both Houses of Parliament 28 May 2024.

Reforming Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) regime
The Attorney-General’s Department is consulting on further reforms to the AML/CTF regime, building on its first-round consultation held in 2023. The current consultation focuses on three main components: addressing vulnerabilities in sectors providing certain high-risk services (tranche two sectors), modernising digital currency and payments technology-related regulation, and simplifying, and modernising the AML/CTF regime. Feedback is sought on the merits and proposed design of the proposals, including how they can be practically implemented.
Due date 13 June 2024.

Delivering Better Financial Outcomes (Quality of Advice) – Recommendation 7
The Australian Taxation Office is seeking feedback on public advice and guidance needs for the new measure addressing financial advice fees charged under section 99FA of the Superannuation Industry (Supervision) Act 1993. In the Government’s Delivering Better Financial Outcomes Package – reducing red tape and other measures, Recommendation 7 sough to clarify the legal basis for superannuation trustees reimbursing a member’s financial advice fees from their superannuation account, and associated tax consequences. Division 2 of the exposure draft Treasury Laws Amendment (Delivering better Financial Outcome sand Other measures) Bill 2024, makes amendments to the Income Tax Assessment Act 1997 to ensure that financial advice fees charged under section 99FA of the Superannuation Industry (Supervision) Act 1993 are:
tax-deductible for the fund
not treated as superannuation benefits of the member.
The measure is proposed to have retrospective effect. The ATO is seeking feedback on whether there are priority issues where public advice and guidance is needed to help superannuation industry stakeholders understand how the new law applies to their circumstances.
Due date June 2024.

Modern Slavery Amendment (Australian Anti-Slavery Commissioner) Bill 2023
Amends the Modern Slavery Act 2018 to establish the Australian Anti-Slavery Commissioner as an independent statutory office holder within the Attorney-General’s portfolio to provide an independent mechanism for victims and survivors, business, and civil society to engage on issues and strategies to address modern slavery. The Commissioner’s functions would allow the Commissioner to work with Government, business and civil society to support compliance with the Act, improve the transparency of supply chains, and help fight modern slavery in Australia and abroad. The Senate Legal and Constitutional Affairs Legislation Committee report recommends passage of the legislation. Committee report (28/02/2024)
Status of legislation: Received Royal Assent 11 June 2024.

On 2 April 2024, the Parliamentary Joint Committee on Corporations and Financial Services resolved to commence an inquiry into financial services regulatory framework in relation to financial abuse. The terms of reference outline the parameters of the inquiry which at a high-level include:
The prevalence and impact of financial abuse including approaches taken by financial institutions to identify, record and report financial abuse.
The effectiveness of existing legislation, common law, and regulatory arrangements that govern the ability of financial institutions to prevent and respond to financial abuse.
Potential areas for reform, such as prevention, protection, and proactive systems.
Steps that might be taken to support financial institutions to better detect and respond to financial abuse.
The role of government agencies in preventing and responding to financial abuse.
The funding and operation of relevant advisory and advocacy bodies.
Due date for written submissions by 14 June 2024.

Australian Prudential Regulation Authority (Confidentiality) Determination No. 1 of 2024 (FED)
This legislative instrument determines that certain information provided to APRA (Australian Prudential Regulation Authority) by financial sector entities under specified reporting standards is non-confidential and can be disclosed publicly.
The instrument is divided into three parts:
Part 1 covers reporting documents that are entirely non-confidential.
Part 2 covers reporting documents that are partly non-confidential.
Part 3 covers information related to MySuper products that is non-confidential.
The purpose is to promote transparency, best practices, and accountability in the superannuation industry by enabling the disclosure of non-confidential information to regulators, policymakers, industry, researchers, and analysts.
The non-confidential information covers details like expenses, asset allocation characteristics, structure, fees and costs for superannuation products and funds. APRA conducted public consultations and considered industry feedback before finalizing the determination, addressing concerns around disclosure of commercially sensitive data.
The instrument commences 8 June 2024.

Family Law (Superannuation) (Interest Rate for Adjustment Period) Determination 2024 (FED)
The Family Law (Superannuation) (Interest Rate for Adjustment Period) Determination 2024 determines the interest rates and methods for calculating interest rates to adjust superannuation entitlements of separated or divorced spouses and de facto couples under certain orders or agreements that split future superannuation benefits as part of property settlements under the Family Law Act 1975.
The interest rates are used to annually adjust the “base amount” allocated or specified in the order or agreement until superannuation benefits become payable or the interest is split earlier.
The determination covers two types of superannuation interests:
Defined benefit superannuation interests, where benefits are linked to the member’s period of membership and salary. Interests in self-managed superannuation funds with no more than 6 members.
For the 2024-25 financial year, the interest rate for adjusting the base amount is determined to be 0.070 (7.0%), which is 2.5 percentage points above the percentage change in full-time adult ordinary time earnings for the year ending November 2023.
The determination also provides methods to calculate interest rates for adjustment periods less than 12 months within the 2024-25 financial year, as well as for adjustment periods spanning the 2023-24 and 2024-25 financial year.
The determination commences 1 July 2024.

Senate Standing Committees on Economics
Improving consumer experiences, choice, and outcomes in Australia’s retirement system
On 27 November 2023, the Senate referred an inquiry into improving consumer experiences, choice, and outcomes in Australia’s retirement system to the Senate Economics References Committee for inquiry and report by 30 June 2024. On 26 March 2024, the Senate approved an extension to report to 30 June 2025 for this inquiry. On 9 May 2024, the committee presented an interim report. On 16 May 2024 the committee agreed to receive further submissions. The closing date for the committee receiving submissions is 28 June 2024.

Delivering Better Financial Outcomes Tranche 1 – Draft Regulations
The Treasury is consulting on the Treasury Laws Amendment (Delivering Better Financial Outcomes) Regulations 2024 (draft regulations). These are consequential amendments to support the implementation of the Treasury Laws Amendment (Delivering Better Financial Outcomes and Other Measures) Bill 2024 (the Amending Bill) and delivery of the first tranche of the government’s response to the Quality of Advice Review.
Its purpose is to support increased access to affordable financial advice with the Regulations proposing to:
Support written information or documentation requirements for the purposes of section 99FA of the Superannuation Industry (Supervision) Act 1993 to continue to be met electronically.
Remove requirements related to Fee Disclosure Statements, update record keeping obligations for new consent requirements and remove references to civil penalties which are removed in the Amending Bill.
Align requirements for Financial Services Guides and Website Disclosure Information and make other consequential amendments.
Streamline the regulations for conflicted remuneration.
Ensure the informed consent requirements apply for benefits given in relation to a general insurance product where personal advice is provided.
Due date: 8 July 2024

Treasury Laws Amendment (Delivering Better Financial Outcomes and Other Measures) Bill 2024
Schedule 1 to the Bill delivers tranche 1 of the Government’s Delivering Better Financial Outcomes package, including the initial response to the Quality of Advice review. Tranche 1 includes amendments that will provide legal certainty for the payment of financial adviser fees from a member’s superannuation fund account and remove red tape that currently adds to the cost of financial advice with no benefit to consumers.
Status of legislation: Received Royal Assent 11 July 2024.