The recent announcements of consumer credit changes (including to responsible lending) and insolvency law reform will affect your regulatory change planning and preparation.

Here’s a snapshot of key changes coming up (that have been passed or announced) for the rest of 2020 and 2021.

The Government says that by 30 June 2021, legislation for all Financial Service Royal Commission recommendations requiring legislative change will have been introduced into parliament. These changes and other reviews will be implemented in 2021-2022.

Also see ASIC’s timetable of ongoing work.

December 30, 2020

Royal Commission changes

Consultation and introduction of legislation for first group of Financial Services Royal Commission changes including removal of POS exemptions, deferred sales model for add-on insurance

December 30, 2020
January 1, 2021

Anti-hawking

Prohibition of hawking of insurance and superannuation

January 1, 2021
January 1, 2021

New small business insolvency process

Incorporated businesses with liabilities of less than $1 million will be able to keep trading without an administrator while they develop a debt restructuring plan.

January 1, 2021
January 1, 2021

Mortgage brokers

Mortgage broker commission changes and best interests duty starts

January 1, 2021
January 1, 2021

Payment times reporting

Payment Times Reporting Act commences

January 1, 2021
March 1, 2021

Consumer credit changes

changes to the National Credit Act responsible lending obligations

March 1, 2021
March 31, 2021

Modern Slavery Act

first statement under the Modern Slavery Act (Cth) due for financial-year-reporting entities

March 31, 2021
April 5, 2021

Unfair insurance contracts

Unfair insurance contract prohibition commences

April 5, 2021
June 30, 2021

Royal Commission changes

Consultation and introduction of group 2 Financial Services Royal Commission changes including

*Compensation scheme of last resort

*Extension of BEAR to RSE licensees and insurers (FAR)

June 30, 2021
July 1, 2021

General Insurance Code of Practice

General Insurance Code of Practice commences

July 1, 2021
October 1, 2021

Breach reporting

changes to the breach reporting regime

October 1, 2021
October 1, 2021

Reference checking

reference checking for mortgage brokers and financial advisers

October 1, 2021
October 1, 2021

Misconduct

notify clients of suspected misconduct

October 1, 2021
October 5, 2021

Product design and distribution obligations

New product design and distribution obligations commence

October 5, 2021
October 5, 2021

Internal Dispute Resolution

New ASIC RG 271 commences

October 5, 2021
January 1, 2022

Credit Risk

Revised APS 220 Credit Risk Management commences.

January 1, 2022

Monitor

*Mandatory credit reporting regime

*Revised Customer Owned Banking Code of Practice

*revised ePayments Code *Directors Identification Numbers (12 June 2022)

*APRA remuneration standard

*AML/CTF amendments

*Cash payment limits

*Retail payment regulation

Risks

*COVID19

*Outsourcing

*Technology

*Information Security

*Privacy

*Climate change

*More active supervision and enforcement by regulators

All of these changes will have an impact on your customers as well as affecting your internal systems and processes. Some, like open banking, will have major technological changes.

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Author: David Jacobson

Principal, Bright Corporate Law

Email: djacobson@brightlaw.com.au

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.

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