Opportunity to consult with the Regulators on FAR

This article identifies key components of the consultation materials:

• the draft Regulator rules prescribe information for inclusion in the register of accountable persons under FAR;
• the draft Transitional rules prescribe information to be provided by ADIs to the Regulators when transitioning from the Banking Executive Accountability Regime (BEAR) to the FAR.

If you would like advice on the potential implications of the proposals for your organisation and/or assistance with engagement with the Regulators during this consultation process, please contact one of our experts.

Draft Regulator Rules – information to be contained in register of accountable persons

The Regulators will be required to establish and keep a register of accountable persons. The FAR Bill provides that the Regulator may make any of the information contained in the register available for public inspection on the internet.

Under the FAR Bill, the register must contain for each accountable person:

1. the person's name;
2. the date of the person's registration as an accountable person;
3. the date the person ceases to be an accountable person;
4. details of any disqualification of the person, and of any variation or revocation of that disqualification;
5. for each accountable entity and each significant related entity in respect of which the person is registered as an accountable person – details of the responsibilities that cause the person to be an accountable person of the entity;
6. any information prescribed by the Regulator rules; and
7. any other information the Regulator considers appropriate to include in the register and is relevant to the person's registration as an accountable person.

The Draft Regulator Rules propose the following additional information be included in the register of accountable persons:

• Personal identification details: The accountable person's date of birth, direct phone number, and direct email address, and dates to any changes of these details.
• Employment status: The accountable person's position title (role title), start and end date of the position title (role title), employer name, start date and end date of employment with the employer.
• Key functions information: Each ADI Key Function (if any) of the accountable person and the dates the accountable person assumed, and ceased to have, responsibility for each ADI Key Function. The Regulators have separately issued a list of ADI Key Function Descriptions.

This introduces a new categorisation requirement for accountable persons. In addition to identifying their responsibilities, including which prescribed responsibilities they hold under the Minister Rules, the entity will need to identify which Key Functions individuals hold.

The proposed rules include only Key Functions for ADIs but the Regulators have signalled that they intend to issue Key Functions for insurers and RSE licensees in due course and for the time being those entities should consider the ADI Key Functions in the consultation process.

• Reporting lines: Position title of the person the accountable person reports to and the dates the accountable person started, and ceased, to report to that person.
• Suspension: Where a person is suspended because they have failed to comply with one or more of their accountability obligations, the start and end date of that suspension.

Draft Transitional Rules

The Draft Transitional Rules propose the following information be provided to APRA, to facilitate the transition from BEAR to FAR, within 30 days after the Financial Accountability Regime (Consequential Amendments) Bill 2023 receives Royal Assent. For each person who is, at the time of transition, an accountable person under BEAR and will become an accountable person under FAR:

• Personal identification details: Former given name(s) (if applicable), former middle name(s) (if applicable), former family name(s) (if applicable), place of birth (town/city), country of birth, state of birth (if applicable), director identification number (if applicable, and subject to section 1270N of the Corporations Act 2001), direct phone number; and direct email address.
• Employment status: The start date of the accountable person's position title (role title) and start date of employment with the employer.
• Reporting lines: Position title of the person the accountable person reports to and the dates the accountable person started, and ceased, to report to that person.
• Responsibilities information: Details of each General or Prescribed Responsibility or Position that cases the person to be an accountable person. [This should be available from their BEAR Accountability Statements.]
• Key functions information: Each ADI Key Function (if any) of the accountable person and the dates the accountable person assumed responsibility for each ADI Key Function.

Online Learning Hub

We also look forward to soon launching our FAR e-Learning Hub, which will contain easy to follow videos and resources with more detail in relation to the Financial Accountability Regime.