House Of Representatives

Financial Sector Legislation Amendment (Simplifying Regulation and Review) Bill 2007

Explanatory Memorandum

(Circulated by the authority of the Minister for Revenue and Assistant Treasurer, the Hon Peter Dutton MP)

General outline and financial impact

Streamlining prudential regulation

Schedule 1 to this Bill amends the Banking Act 1959, Insurance Act 1973, Life Insurance Act 1995, Superannuation Industry (Supervision) Act 1993 (collectively, the prudential Acts) and other related legislation, including the Corporations Act 2001 (Corporations Act) and Financial Sector Collection of Data Act 2001 (FSCODA), to implement Government commitments relating to prudential regulation in response to Rethinking Regulation : The Report of the Taskforce on Reducing Regulatory Burdens on Business (Regulation Taskforce) It also includes additional measures to streamline and simplify the prudential Acts in a manner that is consistent with the Regulation Taskforce's findings.

Date of effect : These amendments apply from the date of Royal Assent unless specified otherwise.

Proposals announced : The proposals were announced in a paper released on 4 December 2006 by the Minister for Revenue and Assistant Treasurer entitled Streamlining Prudential Regulation : ' Response to Rethinking Regulation' .

Financial impact : Nil

Compliance cost impact : These amendments are expected to result in a reduction in compliance costs for the finance sector. The Office of Best Practice Regulation granted an exemption from having to provide a Regulation Impact Statement.

Financial assistance

Schedule 2 to this Bill amends the SIS Act and the Financial Institutions Supervisory Levies Collection Act 1998 so that, where a superannuation fund has suffered loss as a result of fraudulent conduct or theft, financial assistance is available on a more equitable basis. The amendments also abolish the Special Protection Account.

Date of effect : These amendments apply from the date of Royal Assent.

Proposals announced : The proposals were announced in the former Minister for Revenue and Assistant Treasurer, Senator the Hon Helen Coonan, Press Release No. C065/04 of 7 July 2004.

Financial impact : Nil

Compliance cost impact : Low. A Regulation Impact Statement has been prepared.

Accounts, reporting, obligations etc

3.1 Schedule 3 to this Bill amends the SIS Act, the Superannuation (Self Managed Superannuation Funds) Taxation Act 1987 (SMSF Taxation Act) and the Income Tax Assessment Act 1936 (ITAA 1936) to:

·
consolidate and rationalise the prudential reporting requirements under the SIS Act;
·
distinguish between reporting requirements relating to registrable superannuation entities (RSEs) and self-managed superannuation funds (SMSFs); and
·
close the regulatory gap that exists in the SIS Act for the reporting of contraventions of the market conduct and disclosure provisions in the Corporations Act..

Date of effect : These amendments apply from the date of Royal Assent.

Proposals announced : The proposal was announced on 4 December 2006 in a paper released by the Minister for Revenue and Assistant Treasurer entitled Streamlining Prudential Regulation : ' Response to Rethinking Regulation' .

Financial impact : Nil

Compliance cost impact : Nil

Technical amendments relating to legislative instruments

Schedule 4 to this Bill makes amendments to various legislation that are consequential on the enactment of the Legislative Instruments Act 2003 .

Date of effect : These amendments apply from the date of Royal Assent.

Proposals announced : The amendments have not previously been announced.

Financial impact : Nil.

Compliance cost impact : Nil.


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