Legislation passes Parliament
LegalComplianceCorporate29/06/2021 12:00:00 AM

Company Law - Legislation passes Parliament for new Authority to assess Regulator performance

The Financial Regulator Assessment Authority Bill 2021 and the Financial Regulator Assessment Authority (Consequential Amendments and Transitional Provisions) Bill 2021 (Bills) were passed by the Senate on 23 June 2021 and now await assent. The changes are expected to commence on 1 July 2021.

Details

The Bills give effect to Recommendations 6.13 and 6.14 of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (Banking Royal Commission) by establishing the Financial Regulator Assessment Authority (FRAA), an independent body to assess the effectiveness and capability of both the ASIC and APRA (the regulators).

The Financial Regulator Assessment Authority Bill 2021 was passed with amendments which prohibit the Secretary of the Department of the Treasury to nominate a Senior Executive Service employee to be an ex-officio member of the FRAA, as this would undermine the independence and impartiality of the authority. The Financial Regulator Assessment Authority (Consequential Amendments and Transitional Provisions) Bill 2021 was passed without amendments.

The FRAA’s biennial reports on the regulators’ effectiveness and capabilities will be tabled in Parliament. The reports are designed to complement the existing accountability measures which apply to the regulators, and not to replace those measures.

The FRAA will consist of 3 independent statutory appointees. The full membership of the FRAA will be announced by the Government in due course.

Further reading

You can read more about the Bills on our Pinpoint platform here.

You can read more about the Banking Royal Commission on our Pinpoint platform here.

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Sources: Office of the Hon Josh Frydenberg MP, Parliament passes legislation to establish Financial Regulator Assessment Authority, [media release], 23 June 2021.

CCH Pinpoint ®, New Authority to assess performance of ASIC and APRA following Banking Royal Commission, 19 May 2021, accessed 29 June 2021.