There’s a lot happening in the regulatory world for financial services. Stuart Robert, new Assistant Treasurer, told the SuperRatings/Lonsec conference late last month that he was hopeful of at least four, maybe five, Bills making it through Parliament this month. Here is an interesting update from QMV Solutions.
While preparation for round seven of the Royal Commission hearings has been prominent during October, there were important legislative and regulatory developments which superannuation trustees should remain attentive to, the regulatory advisor to super funds says.
QMV’s latest client newsletter points out that the product ‘Design and Distribution’ obligations and changes to the ASIC intervention powers were introduced to Parliament last month – a “significant reform which will impact all superannuation trustees if it passes into law”, the firm says.
Changes to the proposed CIPR (Comprehensive Income Products for Retirement) commencement date and minimum threshold were announced, and the Bill to implement tougher penalties on financial sector and corporate crime and misconduct have also been introduced into Parliament.
“We also saw a strong focus on minor and technical amendments affecting the superannuation and pensions industry, including amendments to the work test for recent retirees, corporate collective investment vehicles and transfer balance credits,” according to Jonathan Steffanoni, QMV’s principal consultant for legal and risk.
The ‘Design and Distribution’ Bill should be looked at closely by wholesale fund managers which deal with platforms and planners. It is potentially a new regulation which can cause a lot of grief down the track. It proposes to ensure, for instance, that product are targeted at the “right” people.
Following consultation, the threshold superannuation balance for offering a Comprehensive Income Product for Retirement will be raised from $50,000 to $100,000 and commencement of the requirement for funds to offer these products will be deferred from 2020 to July 1, 2022.
There is a raft of other changes which have or are going to Parliament this month – the last time to get new laws passed for the year, many of them pre-emptive or overlapping the findings of the Royal Commission, which are due in February.