Welcome to the latest issue of the KHQ Super Alert. This week, APRA released its quarterly industry statistics, AUSTRAC published its summary of the upcoming AML/CTF reforms and launched a consultation on amendments to the AML/CTF Rules. The ATO also issued an amended Taxation Ruling dealing with who is an employee for SG purposes.

APRA – Quarterly superannuation statistics released

On 12 December 2024, APRA released the quarterly superannuation industry publication, the quarterly superannuation product statistics and the quarterly fund-level statistics for the quarter ending September 2024. These publications contain detailed industry, fund and member demographic level information.

Some key statistics include that as at 30 September 2024:

• there were 57 MySuper products, 457 accumulation choice products, and 222 retirement products (including transition to retirement);
• there were over 14.8 million MySuper member accounts; and
• the average member account balance had increased to $71,000 for MySuper products, $135,000 for accumulation choice products, and $364,000 for retirement products (excluding transition to retirement).

Click here for details.

AUSTRAC – Tips for 2024 compliance reports

On 12 December 2024, AUSTRAC issued a media release outlining its ‘top tips’ for reporting entities to submit their yearly compliance report. In its release, AUSTRAC explains that ‘[y]our compliance report shows how you met your anti-money laundering and counter-terrorism financing (AML/CTF) obligations for the previous calendar year’ and that ‘[t]hese reports are crucial for protecting the community from financial related crimes’.

AUSTRAC has outlined how to lodge a compliance report, what to do if changes are required after a report is submitted and how to appoint a new representative for AUSTRAC Online access. AUSTRAC has advised that entities ‘must submit [their] compliance report by 11:59pm on 31 March 2025’.

Click here for details.

AUSTRAC – Summary of upcoming reforms

On 11 December 2024, AUSTRAC launched a new webpage which summarises the steps that reporting entities need to take to be prepared for the AML reforms that are coming into effect on 31 March 2026. These reforms arise as a result of the Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) Amendment Act 2024 (Cth) which was recently passed by Parliament.

For example, some of the reforms relate to:

• no longer separating ‘an AML/CTF program into Part A and Part B’ as entities will be able to ‘organise [the] AML/CTF program in a way that meets [their] needs, provided it meets the requirements of the AML/CTF Act’;
• separating customer due diligence requirements into two categories – initial due diligence and ongoing due diligence, and also clarifying ‘the level of checks applied to each customer under initial and ongoing’ due diligence; and
• amending ‘the prohibition on ‘tipping off’ customers regarding the reporting of suspicions of unlawful activity. The reform is intended to facilitate information sharing within reporting groups while ensuring the integrity of investigations’.

Click here for details.

AUSTRAC – Public consultation on new AML/CTF Rules

On 11 December 2024, AUSTRAC launched a consultation in relation to proposed amendments to the Anti-Money Laundering and Counter-Terrorism Financing Rules Instrument 2007 (No. 1) (AML/CTF Rules). As part of the reforms to the AML/CTF Act referred to in the above news item, AUSTRAC is now seeking feedback on the amendments required to the AML/CTF Rules to ensure that they are also consistent with the reforms.

AUSTRAC has explained that ‘[t]here is significant change proposed in the new Rules instrument so it’s important that [stakeholders] consider the consultation paper’. The consultation period closes on 14 February 2025.

Click here for details.

ATO – Amendments to ATO ruling about employees for SG purposes

On 11 December 2024, ATO released the final version of an addendum to Taxation Ruling 2023/4: Income tax and superannuation guarantee: who is an employee? (previously called Income tax: pay as you go withholding – who is an employee?). The addendum includes guidance in Appendix 2 ‘on when a person is considered to be an ‘employee’ under section 12 of the Superannuation Guarantee (Administration) Act 1992 (SGAA)’.

The ATO has explained that Appendix 2:

• ‘assists the community by confirming the ATO’s view in light of developments in case law in the context of the SGAA since SGR 2005/1W Superannuation guarantee: who is an employee? (withdrawn) was last updated;
• consolidates the ATO’s view in respect of the common law definition of employee contained in SGR 2005/1 (withdrawn) and TR 2023/4;
• provides a holistic ATO view of the common law meaning of employee and extended meaning of the word as contained in the SGAA’.

Appendix 2 replaces the withdrawn Superannuation Guarantee Ruling 2005/1 Superannuation guarantee: who is an employee? which was withdrawn with effect from 26 June 2024.

Click here for details.

Legislation – Registration of the Treasury Laws Amendment (Miscellaneous and Technical Amendments No. 2) Regulations 2024

On 9 December 2024, the Treasury Laws Amendment (Miscellaneous and Technical Amendments No. 2) Regulations 2024 were registered on the Federal Register of Legislation. As referred to in our Super Alert of 4 October 2024, Treasury had released an exposure draft version of these regulations earlier this year.

The regulations amend the SIS Regulations to:

• exclude transition to retirement products from the meaning of ‘trustee-directed product’ for the purposes of the annual performance test;
• remove an exemption relating to section 68A of the SIS Act (Trustees must not use goods or services to influence employers) as this exemption was aligned to the previous version of section 68A;
• repeal redundant regulation 2.36D and make consequential amendments; and
• ‘clarify the operation of the duty of superannuation trustees to notify the Regulator of significant adverse events’.

Click here for details.

Legislation – Registration of the Treasury Laws Amendment (Legacy Retirement Product Commutations and Reserves) Regulations 2024

On 6 December 2024, the Treasury Laws Amendment (Legacy Retirement Product Commutations and Reserves) Regulations 2024 were registered on the Federal Register of Legislation. As referred to in our Super Alert of 20 September 2024, Treasury had released an exposure draft version of these regulations earlier this year.

The Explanatory Statement explains that the purpose of the regulations is ‘to allow individuals to exit [certain legacy retirement] products’ such as ‘legacy lifetime, life expectancy and market-linked superannuation income stream products’ that ‘commenced prior to 20 September 2007’. The regulations propose special rules in relation to the application of the contribution caps if a product is exited and reserves are used to provide capital.

Click here for details.

APRA – Final response to the consultation on enhancing superannuation data collections

On 6 December 2024, APRA released its response ‘to a recent consultation on enhancing superannuation data collections covering investments, trustee licensee profile and trustee profile’. The consultation was launched in November 2023, with initial feedback issued in September 2024. As part of this final response, APRA announced it has enhanced its data collections by:

• ‘Addressing a key gap in current investment data on liquidity and valuation risk’;
• ‘Enhancing the reporting on trustee boards’; and
• ‘Completing the picture of trustee’s business operations by including product distribution arrangements’.

APRA stated that ‘[t]he enhanced data collection will further strengthen APRA’s ability to assess the financial resilience of funds and the robustness of governance’. The first data set will need to be submitted in December 2025.

Click here for details.

Treasury – Commitment to making an open register of beneficial ownership

On 5 December 2024, Treasury released a policy specification document in relation to the Government’s commitment ‘to making an open register of beneficial ownership’ of unlisted companies. Treasury states that the policy specification is ‘based on:

• the approach outlined in the 2022 consultation
• feedback from that consultation
• findings of the privacy impact assessment’.

Separately, Treasury ‘commissioned the Australian Government Solicitor to complete a Privacy Impact Assessment (PIA) to consider the potential privacy impacts of the implementation of the Beneficial Ownership Policy (BO Policy)’. According to Treasury, the PIA found that ‘the privacy impacts of the BO Policy are proportional to the public benefit of the scheme. Nonetheless, it involves substantial, and mandatory, collection, use and disclosure of personal information’ and identified ‘additional protections which the BO Policy could include to appropriately protect the privacy of beneficial owners’.

Click here and here details.