The Financial Accountability Regime (Minister) Rules 2024 have been registered. Background.

The Regime will commence on 15 March 2024 for ADI’s.

The Rules support the establishment of the Financial Accountability Regime by:

• prescribing responsibilities and positions that cause an individual to be an accountable person of an accountable entity in the banking, insurance, and superannuation sectors, and therefore subject to the Financial Accountability Regime;
• prescribing when an accountable entity meets the enhanced notification threshold based on total assets reported to APRA.

The Rules prescribe 12 responsibilities that cover senior executives with responsibility for management (and in some cases control) of specified activities and functions relating to the accountable entity.

These prescribed responsibilities are modelled on specific responsibilities listed in section 37BA(3) of the Banking Act 1959, to support a smooth transition from the Banking Executive Accountability Regime to the Financial Accountability Regime. The nature of a person’s responsibility determines whether a person is an accountable person under this section. A person’s position or title is not relevant to determining whether a person has a prescribed responsibility.

There is a distinction between an accountable entity and an Australian branch of a foreign accountable entity.

FAR Regulator and Transitional Rules

ASIC and APRA are expected to publish draft or final FAR guidance by the end of March 2024.

ASIC and APRA intend to:

• Jointly publish the final Regulator rules and Transitional rules for the Financial Accountability Regime
  (FAR) for ADIs .
• Jointly publish an all-industry information paper to provide guidance on the FAR.
• Jointly consult on the Regulator rules for the FAR for the insurance and superannuation industries.

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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.