Simplified outline of this Act
4 Simplified outline of this Act
This Act establishes a strengthened accountability framework for financial entities in the banking, insurance and superannuation industries that are regulated by Acts under which APRA is the prudential or principal regulator. These entities are called accountable entities.
The framework is intended to ensure that accountable entities take reasonable steps:
to conduct their business with honesty and integrity, and with due skill, care and diligence; and
to deal with APRA and ASIC in an open, constructive and cooperative way; and
to prevent adverse effects on their prudential standing or prudential reputation; and
to ensure that their senior executives and other key personnel (called accountable persons) meet those same standards of conduct, and take reasonable steps to ensure compliance with applicable laws; and
to ensure that related entities whose business and activities materially and substantially affect the accountable entities (called significant related entities) comply with the framework in the same way as the accountable entities themselves.
Other entities that hold Australian financial services licences or Australian credit licences are not covered by the framework in this Act.
Accountable entities are subject to a series of obligations that enable oversight and enforcement by APRA and ASIC (together called the Regulator). These are enforced mainly through civil penalties for non‑compliance.
Accountable persons are also subject to obligations, which can be enforced by accountable entities through reduction of deferred remuneration, or by the Regulator through disqualification.
A range of compliance and enforcement powers are provided for, including by applying the Regulatory Powers (Standard Provisions) Act 2014.
This Act’s bill:Explanatory memorandumSecond reading speech
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