05 March 2019

Financial Services Royal Commission: State of play one month out

There have been a number of developments since the Government’s release of the final report of the Royal Commission into the Financial Services Industry and the Government’s response on 4 February 2019.

Parliament has made progress on a few of the final report’s recommendations but it is now very unlikely that any more legislation will be passed before the Federal election (which must be held by 18 May).

However, many recommendations do not require legislation and progress can continue to be made on those recommendations even before Parliament resumes after the election.

Recommendations not requiring legislation

Many recommendations require action by other parties such as regulators, Treasury, industry bodies or financial institutions themselves. Two recommendations recommended no action and so there are only 74 to action.

Non-legislative developments since 4 February include:

  • the Australian Securities and Investments Commission outlined its planned actions on the 12 recommendations directed at it including its approach to enforcement – View here
  • the Australian Prudential Regulation Authority announced a timetable for completing 10 recommendations that require its direct attention – View here
  • the Australian Bankers Association has agreed to amend the Banking Code of Conduct to implement a number of recommendations and ASIC has commenced work on the amendments – View here
  • the Australian Financial Complaints Authority announced it will run limited consultation regarding required changes to its Rules and that it will be issuing guidance prior to 1 July 2019 – View here

How quickly will the recommendations be implemented?

There are numerous ways in which some recommendations could be implemented (e.g. legislation, regulations, ASIC instrument or licence variations). How quickly these recommendations are implemented will depend in part on:

  • how complex the recommended change is and whether draft legislation has already been released and been subject to consultation;
  • how it is implemented (e.g. regulations are usually quicker than legislation);
  • the time provided for consultation;
  • if the final report recommended a particular commencement date; and
  • the Government’s policy and numbers in Parliament.

To keep up to date with Royal Commission developments regularly, check our Royal Commission Hub.

We are happy to assist you in considering the final report and how it impacts your business. Please contact your usual KWM contact or Jim Boynton on 9296 2086 or [email protected] if you would like to discuss the report further.

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