The Australian Government opens consultation on certain recommendations made by the Royal Commission. The government is proposing to impose a legal obligation on the Australian Securities and Investment Commission and the Australian Prudential Regulation Authority. It wants to cooperate and exchange information between them. How does the government consult on ASIC info sharing in Australia?
26 December, 2019 | AtoZ Markets – Financial Services Royal Commission made several recommendations. That regards the activities and governance of ASIC and APRA, including how they cooperate and exchange information. On February 4, 2018, the government released its response to the Royal Commission and was taking action on the 76 recommendations.
New obligations for ASIC and APRA Regarding Info Sharing in Australia
The government has published for public comment an exposure draft legislation that implements 6.9 and 6.11 recommendations of the Royal Commission.
- Recommendation 6.9 will oblige ASIC and APRA to cooperate, exchange information. And it will also oblige to notify each other if they have reasonable grounds to believe that the legislation of the other party has been violated.
- Recommendation 6.11 will formalize and align the meeting procedures of the ASIC Commission with the procedures of the APRA Act. That is for meetings of APRA members.
Under the new law, APRA and ASIC have to cooperate in the exercise of their functions and powers, to the extent possible.
APRA and ASIC Need to Comply with a Request
In addition to having the discretion to share information, both regulators have to comply with a written request for information from either. Unless they formally refuse in writing from the Chair or Chairperson, as the case may be.
For example, the types of information that would be included are:
- Audit documents prepared for a company and disclosed to a regulatory body.
- The information has to be collected from a regulated entity.
- Voluntarily provided information of either regulatory body about the types of financial products that a person or business offers to consumers.
- Mandatory reports or filings provided by a company to a regulatory authority.
There are exclusions from the information and documents that may be requested. For example, information or documents that relate to the internal or administrative functions of a regulatory body will not affect. These include documents related to the daily operations of an agency. Those are such as leases, procurement or tender contracts, staff employment contracts.
There are also several protections and limits on the use and disclosure of information. That applies under existing Commonwealth legislation or general law. Finally, APRA and ASIC are required to notify each other of material breaches for which the other regulatory body has enforcement responsibilities.
Interested parties welcome to submit responses to this consultation until January 24, 2020. Legal requirements, such as those imposed by the Freedom of Information Act 1982, can affect the confidentiality of the submission.
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