The federal government has released the Financial Sector Legislation Amendment (Prudential Refinements and Other Measures) Bill 2010 for public debate.
The new legislation seeks to strengthen the Australian Prudential Regulation Authority's (APRA) ability to supervise the financial sector and is in line with similar moves in overseas markets such as the UK and the US to reinforce current regulatory frameworks.
Included in the amended bill are procedures that will boost the regulator's capacity to investigate risks faced by institutions in the sector in order to promote financial stability, force compliance and remedy any breaches that may occur.
Procedures are also included to prevent institutions from suffering potential financial distress and in the process maintain financial stability and administer the financial claims scheme in order to protect deposits in banks, building societies, credit unions, and eligible general insurer policyholders.
The legislative update also enhances APRA's ability to collect data required to monitor the latest developments in the financial sector.
Furthermore, the amended bill has incorporated some of the changes to the levies framework of the sector that were recommended by the report stemming from the review of the financial sector levies compiled last year.
"The government is committed to ensuring Australia has a regulatory framework that is risk-based, consultative and consistent with international best practice," Minister for Financial Services, Superannuation and Corporate Law Chris Bowen said.
In its call for public submissions, the government is particularly keen to receive suggestions that will both improve the regulatory framework and reduce the costs involved.
Submissions may be lodged by facsimile, post or electronically with the closing date being 16 March 2010.
