Financial Sector (Collection of Data) (reporting standard) determinations No. 1 and 27 of 2014
EXPLANATORY STATEMENT
Prepared by the Australian Prudential Regulation Authority (APRA)
Financial Sector (Collection of Data) Act 2001, sections 13 and 15
Acts Interpretation Act 1901, section 33
Under subsection 13(1) of the Financial Sector (Collection of Data) Act 2001 (the Act), APRA has the power to determine reporting standards, in writing, with which financial sector entities must comply. Such standards relate to reporting financial or accounting data and other information regarding the business or activities of the entities. Subsection 33(3) of the Acts Interpretation Act 1901 provides that where an Act confers a power to issue an instrument the power shall, unless the contrary intention appears, be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to revoke any such instrument.
On 17 June 2014 APRA made the following determinations (the instruments):
(1) Financial Sector (Collection of Data) (reporting standard) determination No. 1 of 2014 which:
(i) revokes Reporting Standard SRS 530.0 Investments made under Financial Sector (Collection of Data) (reporting standard) determination No. 21 of 2014; and
(ii) determines Reporting Standard SRS 530.0 Investments (SRS 530.0); and
(2) Financial Sector (Collection of Data) (reporting standard) determination No. 27 of 2014 which:
(i) revokes Reporting Standard SRS 532.0 Investment Exposure Concentrations made under Financial Sector (Collection of Data) (reporting standard) determination No. 24 of 2014; and
(ii) determines Reporting Standard SRS 532.0 Investment Exposure Concentrations (SRS 532.0).
Both instruments commence on 1 July 2014 and apply to reporting periods ending on or after that date.
- Background
APRA is empowered to make reporting standards under the Act, which require regulated institutions, including RSE licensees, to submit specified data through various reporting forms. Data from these forms are used internally to assist APRA’s supervisory functions and by other agencies such as the Australian Bureau of Statistics and the Australian Securities and Investments Commission. APRA also collates and publishes statistical information and analysis using data from these reporting forms.
In 2013, APRA released a suite of 37 final reporting standards applying to the superannuation industry.
Since the commencement of the new reporting requirements, APRA has received industry feedback on some of these obligations, seeking clarification and guidance on interpretation. As a result, APRA has publicly released a number of frequently asked questions (FAQs) on the APRA website to provide timely guidance for RSE licensees to ensure the submission of high quality data to APRA.
A number of matters raised by industry stakeholders and which are covered in FAQs are those that APRA considers necessary to include in the reporting standards, forms and instructions on an ongoing basis.
On 25 March 2014, APRA released revised versions of six quarterly reporting standards, and a further five annual and ad hoc reporting standards on 30 May 2014, which APRA had identified as requiring amendment. These minor amendments somewhat simplified the superannuation industry’s reporting obligations, but did not impose any new obligations.
Following this, APRA has identified two quarterly reporting standards which would benefit from minor amendment, with respect to the reporting form and the associated instructions. These amendments are required only to bring about consistency with specific changes which became legally effective in March and June 2014.
2. Purpose and operation of the instruments
The purpose of making the instruments is to amend two quarterly reporting standards to ensure that the changes made in March and June 2014 to the relevant forms are reflected consistently in the two quarterly reporting standards.
In March 2014, Reporting Standard SRS 530.1 Investments and Investment Flows (SRS 530.1) was revised to include the option ‘life company other’ at item 4 of the form, plus changes to the associated instructions. Then in June 2014, a similar change was made to Reporting Standard SRS 801.0 Investments and Investment Flows (SRS 801.0).
Following this, APRA has identified that the same change to the form and associated instructions is also required to be made to Reporting Standard SRS 530.0 Investments and Reporting Standard SRS 532.0 Investment Exposure Concentrations.
The above changes are considered essential to ensure consistency of reporting to APRA via the Direct to APRA system (D2A). The risks from not making these changes are that the reporting to APRA of this data would be inconsistent and would hamper APRA’s ability to collect meaningful and accurate statistical data. In turn, this would adversely affect APRA’s ability to publish fully accurate data. The above changes are therefore considered essential.
Details of the changes to the two quarterly reporting standards are outlined below:
(1) Reporting Standard SRS 530.0 Investments
- Addition of the option ‘life company other’ at items 3, 4.1, 4.2 and 4.3;
- Changes to the associated instructions to include reference to the option ‘life company other’ where relevant; and
- Changes to the definitions for ‘life company guaranteed’ and ‘life company investment-linked’ and inclusion of a new definition for ‘life company other’.
(2) Reporting Standard SRS 532.0 Investment Exposure Concentrations
- Addition of the option ‘life company other’ at items 2.1 and 3;
- Changes to the associated instructions to include reference to the option ‘life company other’ where relevant; and
- Changes to the definitions for ‘life company guaranteed’ and ‘life company investment-linked’ and inclusion of a new definition for ‘life company other’.
3. Consultation
APRA undertook extensive consultations on the development of the 37 reporting standards, including SRS 530.0 and SRS 532.0, which were determined in 2013.
The substance of these changes, which do not substantially alter existing arrangements, have been previously communicated to industry via the FAQs on APRA’s website.
4. Regulation Impact Statement
The Office of Best Practice Regulation has advised that a Regulation Impact Statement is not required for these legislative instruments.
5. Statement of compatibility prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
A Statement of compatibility prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 is provided at Attachment A to this Explanatory Statement.
.ATTACHMENT A
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Financial Sector (Collection of Data) (reporting standard) determinations Nos. 1 and 27 of 2014
The above legislative instruments are compatible with the human rights and freedoms recognised or declared in the international instrument listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (HRPS Act).
Overview of the Legislative Instruments
The purpose of making these legislative instruments is to revoke existing reporting standards and remake reporting standards to make minor and machinery amendments to the reporting requirements in relation to RSE licensees.
Human rights implications
APRA has assessed the instruments against the international instruments listed in section 3 of the HRPS Act and determined that only Article 17 of the International Covenant on Civil and Political Rights (ICCPR) is conceivably potentially of relevance to the legislative instruments.
Article 17 of the ICCPR prohibits the arbitrary or unlawful interference with a person’s privacy, family, home and correspondence, and attacks on reputation. Article 17 is exclusively concerned with prohibiting interference with the privacy and/or reputation of individual persons. It does not extend to the privacy and/or reputation of corporate entities.
The majority of information collected will be about the profile and structure, financial performance and investments of each RSE licensee’s business operations but will not involve the collection of information directly relating to individual persons.
Information provided to APRA under reporting standards is protected information for the purposes of section 56 of the Australian Prudential Regulation Authority Act 1998 (APRA Act) and cannot be disclosed except under a limited range of circumstances provided for under that section. While APRA does publish some protected information gathered under reporting standards, APRA reviews all releases of data received under reporting standards to ensure that no information pertaining to an individual person can be deduced from the data.
Consequently the instruments do not engage any of the applicable rights or freedoms recognised or declared in the international instruments listed in section 3 of the HRPS Act. Accordingly, in APRA’s assessment, the instruments are compatible with human rights.
Conclusion
Financial Sector (Collection of Data) (reporting standard) determination Nos. 1 and 27 are compatible with human rights because the instruments do not limit human rights or otherwise raise any human rights issues.