Australia: Superannuation, Funds Management & Financial Services News - 10 April 2018

Last Updated: 12 April 2018
Article by Chris Lovell, Paul Faure and Bill Glover

Most Read Contributor in Australia, October 2018

In the media

Spotlight on financial elder abuse
MEDIA – 06 April 2018 - While financial advisers are among those best placed to identify instances of financial elder abuse, cases are continually slipping under the radar as it becomes increasingly difficult to recognise. More...

ASIC releases updated guidance on client money
ASIC – 04 April 2018 - ASIC has today released updated guidance for Australian financial services (AFS) licensees that hold client money for trading in over-the-counter (OTC) derivatives. More...

PwC urges super trustees to fast-track GDPR compliance
MEDIA – 04 April 2018 - Superannuation trustees unprepared for the European Union's General Data Protection Regulation (GDPR) regime must fast-track the necessary steps to comply with new, stringent privacy laws, PwC warns. More...

New law tightens unpaid SG penalties
MEDIA – 29 March 2018 - Employers robbing staff of superannuation entitlements could face court-ordered penalties and even jail time under a new law designed to combat the $2.85 billion unpaid super problem. More...

Strengthening financial regulation
TREASURY – 28 March 2018 - Financial institutions that manipulate financial benchmarks will now be hit with specific civil and criminal penalties – thanks to amendments legislated by the Turnbull Government today. The manipulation of any financial benchmark, or product used to determine such a benchmark, is now a specific offence and subject to civil and criminal penalties. More...

CCR legislation introduced into Australian Parliament
MEDIA – 29 March 2018 - Legislation to enforce mandatory comprehensive credit reporting (CCR) has been introduced into the Australian Parliament on Wednesday by Assistant Minister to the Treasurer Michael Sukkar. More...

Reforming payslip reporting will help address super 'theft'
AIST – 27 March 2018 - AIST has reiterated its call to reform payslip reporting to help address the problem of unpaid super, which is estimated to cost workers more than $2.8 billion each year. More...

Industry Code to improve consumer outcomes for insurance in superannuation
ASFA – 27 March 2018 - Today's release of the Parliamentary Joint Committee Life Insurance Inquiry report (the PJC report) highlights the important role of the industry-led Insurance in Superannuation Voluntary Code of Practice (the Code) in improving standards for consumers. ASFA CEO said the Code will ensure superannuation fund members receive appropriate levels of valuable life and disability insurance as well as protection from unnecessary erosion of retirement savings. More...

In practice and courts

ASIC RG 212: Client money relating to dealing in OTC derivatives
RG 212 has been updated to reflect the changes to the law as a result of new reforms. The changes mean that the circumstances in which an AFS licensee may use 'derivative retail client money', within the meaning of the Corporations Act, have been significantly restricted. The reforms also impose new record-keeping, reconciliation and reporting requirements on AFS licensees that hold derivative retail client money (04 April 2018). See Regulatory Guide 212.

ASIC consults on updated guidance for its oversight of the Australian Financial Complaints Authority (AFCA)
ASIC has released draft updated Regulatory Guide 139, Oversight of AFCA (updated RG139) for public consultation. The Bill to establish AFCA passed on 14 February 2018, and Minister for Financial Services, the Hon. Kelly O'Dwyer has announced that AFCA will commence operations no later than 1 November 2018. Responses to the consultation closed on 6 April 2018. Download the consultation paper and draft regulatory guide.

Roadmap for the future of impact investing: reshaping financial markets: Global Impact Investing Network
This strategy document presents a vision for more inclusive and sustainable financial markets, and articulates a plan for impact investing to lead progress toward this future (20 March 2018). More...

ISA Report: Are comparisons based on superannuation fund-level performance useful?
Research houses, government reviews, policy advocates, and many others also use this information to understand the superannuation system better. The appropriateness of these comparisons is, however, contested (03 April 2018). More...

SMSF Association Position Statements
SMSF Association Policy Position: Labor's Imputation Credit Policy – 06 April 2018

Cases

Clark and Commonwealth Superannuation Corporation [2018] AATA 681
SUPERANNUATION – Defence Force Retirement and Death Benefits Scheme – member resumed continuous full time service – member required to elect whether or not to become member of the Military Superannuation Scheme - whether member made a valid election to remain in DFRDB scheme prior to re-commencing service – requirements to make election – where member completed and sent D 100 form after re-commencing service – decision under review varied (2017/1199) - decision under review affirmed (2017/5110)

Defence Force and Death Benefits Act 1973 (Cth); Military Superannuation and Benefits Act 1991 (Cth)

Carroll v United Super Pty Ltd [2018] NSWSC 403
INSURANCE – General – total and permanent disablement – plaintiff/insured self-employed in the building and construction industry – plaintiff suffers hip disability and ceases work in March 2012 – plaintiff a member of an industry superannuation fund – first defendant is a trustee of the fund – first defendant takes out a policy of insurance for the benefit of members of the fund with the second defendant insurer – plaintiff claims he is totally and permanently disabled after being off work for three months and entitled to a benefit for the same – the first and second defendants decline the plaintiff's claim on various dates between June 2013 and April 2014 – identification of the duties applicable to each of the first and second defendants in making their decisions to decline the plaintiff's claim – whether the first defendant trustee failed to act in good faith on a real and genuine consideration of the material before it – whether the second defendant insurer acted with the utmost good faith in dealing with the plaintiff's claim and reasonably in forming an opinion as to whether the plaintiff qualified as totally and permanently disabled under the policy – whether the defendants' respective decisions can be set aside – whether the Court should itself determine whether the plaintiff is totally and permanently disabled under the policy – whether the plaintiff was "unlikely to ever to be able to engage in any regular remuneration work for which he is suited by education training or experience".

'PB' and United Super Pty Ltd as Trustee for Cbus (Privacy) [2018] AICmr 51
Privacy — Privacy Act 1988 (Cth)— National Privacy Principles —s 52 — NPP 2—Unauthorised disclosure of personal information —Apology — Compensation not awarded

Determination: I find that the respondent, United Super Pty Ltd as Trustee for Cbus (Cbus) interfered with the privacy as defined in the Privacy Act 1988 (Cth) (Privacy Act) of class members by disclosing their personal information to an external organisation for a secondary purpose without their consent to that disclosure.

Legislation

Commonwealth

Regulations
Taxation Administration Member Account Attribute Service – the Reporting of Information relating to Superannuation Account Phases and Attributes 2018

Acts
Treasury Laws Amendment (2018 Measures No. 1) Act 2018
03/04/2018 - Act No. 23 of 2018 - An Act to amend the law relating to superannuation, corporations and taxation and to repeal certain Acts and provisions of Acts

Bills
National Consumer Credit Protection Amendment (Mandatory Comprehensive Credit Reporting) Bill 2018
04/04/2018 - A Bill for an Act to provide for mandatory comprehensive credit reporting. This Bill amends the Credit Act to mandate a comprehensive credit reporting regime (the mandatory regime). Under the regime eligible licensees, who on 1 July 2018 are large ADIs, must provide credit information on consumer credit accounts to credit reporting bodies. Date of effect: 1 July 2018

Public Sector Superannuation Legislation Amendment Bill 2018
House of Representatives Second reading moved 28/03/2018

The Bill makes the following changes:

  • amendments to the Parliamentary Contributory Superannuation Act 1948 (PCS Act) to ensure that in all circumstances the calculation of any lump sum superannuation guarantee safety-net benefit meets the minimum Superannuation Guarantee (SG) requirements;
  • the amendments do not increase any parliamentary pension entitlements for any individual members; rather they ensure that the minimum SG requirement will be met in all circumstances;
  • amendments to the Judges' Pensions Act 1968 (Judges' Act) to allow members of the Judges' Pensions Scheme the option to request that they be paid a lump sum amount from the scheme to meet their Division 293 tax liability;
  • amendments to a number of Commonwealth superannuation Acts to standardise and modernise provisions relating to eligibility for reversionary superannuation benefits payable to or in respect of children;
  • two minor amendments to the PCS Act and the correction of a misdescribed amendment relating to the Judges' Act; and
  • amendments to reduce the size of the Commonwealth Superannuation Corporation (CSC) Board from 11 to 9 directors.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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