Commonwealth Numbered Regulations - Explanatory Statements

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LIFE INSURANCE REGULATIONS (AMENDMENT) 1997 NO. 239

STATUTORY RULES 1997 NO. 239

Issued by the authority of the Assistant Treasurer

Life Insurance Act 1995

Life Insurance Regulations (Amendment)

The Life Insurance Act 1995 (the Act) and the Life Insurance Regulations (the Principal Regulations) establish a scheme of prudential supervision of the life insurance industry.

Section 253 of the Act provides that the Governor-General may make Regulations for the purposes of the Act.

Section 251 of the Act provides for secrecy in respect of information acquired for purposes of the Act. Under the provisions of the section, information may be disclosed in certain circumstances. Since its commencement, the Act has provided for information to be disclosed to prescribed financial sector supervisory agencies and law enforcement agencies. The Financial Laws Amendment Act 1997, which commenced on 30 June 1997, amended Section 251 such that information may also be disclosed to prescribed overseas financial sector supervisory agencies.

The regulations amend the Principal Regulations to prescribe additional financial sector supervisory agencies and law enforcement agencies and prescribe overseas financial sector supervisory agencies to whom a compliance officer, pursuant to Section 251 of the Act, may disclose protected information or documents acquired in the course of performing his or her duties.

Section 251 and the amendments to the Principal Regulations are aimed at facilitating the ability of the Insurance and Superannuation Commission to act quickly to exchange information to prevent and/or manage a crisis situation within financial conglomerates.

The regulations are described in detail in the attachment.

ATTACHMENT

Regulation 1 - Amendment

Regulation 1 is explanatory, and includes a note that these regulations commence on gazettal.

Regulation 2 - Regulation 11.02 (Definition of "financial sector supervisory agency") and 11.03 (Definition of "law enforcement agency")

This regulation omits the current regulations 11.02 and 11.03 of the Principal Regulations and inserts substitute regulations. The substitution provides for additional agencies to be prescribed under regulation to ensure consistency across all legislation administered by the Insurance and Superannuation Commission.

Section 251 of the Act generally prohibits a compliance officer from disclosing protected information or producing protected documents, other than for the purposes of the Act or any other Act administered by the Insurance and Superannuation Commissioner, that have been acquired by the compliance officer in the course of performing his or her duties as a compliance officer.

Certain exceptions to this general rule are provided for in section 251. These exceptions include circumstances where protected information may be disclosed, or protected documents produced, to: a financial sector supervisory agency for the purposes of the performance of any of the agency's functions or the exercise of any of its powers; and a law enforcement agency for the purposes of the performance of any of the agency's functions in relation to an offence against a law of the Commonwealth, of a State or of a Territory.

'Financial sector supervisory agency' is defined in subsection 251 (1) of the Act as meaning 'a person or body declared by the regulations to be a financial sector supervisory agency for the purposes of this section'.

Regulation 11.02 prescribes the financial sector supervisory agencies for the purposes of subsection 251 (1) of the Act.

'Law enforcement agency' is defined in subsection 251 (1) of the Act as meaning 'a person or body declared by the regulations to be a law enforcement agency for the purposes of this section'.

Regulation 11.03 prescribes the law enforcement agencies for the purposes of subsection 251 (1) of the Act.

Regulation 11.04 (Definition of an "overseas financial sector supervisory agency")

Section 251 of the Act generally prohibits a compliance officer from disclosing protected information or producing protected documents, other than for the purposes of the Act or any other Act administered by the Insurance and Superannuation Commissioner, that have been acquired by the compliance officer in the course of performing his or her duties as a compliance officer.

Certain exceptions to this general rule are provided for in section 251. Paragraph 251(4)(ca) provides that protected information may be disclosed, or protected documents produced, to an overseas financial sector supervisory agency for the purposes of the performance of any of the agency's functions or the exercise of any of its powers.

'Overseas financial sector supervisory agency' is defined in subsection 251 (1) of the Act as meaning 'a person or body declared by the regulations to be an overseas financial sector supervisory agency for the purposes of this section'.

Regulation 11.04 prescribes the overseas financial sector supervisory agencies for the purposes of subsection 251 (1) of the Act.