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1.1 ASIC’s role and responsibilities

Our regulatory approach

ASIC is Australia’s corporate, markets, financial services and consumer credit regulator.

We have a number of regulatory tools available to us to address the harms that threaten good investor and consumer outcomes. These tools include enforcement action, supervision and surveillance, engagement with industry and other stakeholders, guidance, education and policy advice.

For most of the issues in our remit, we use a number of these tools to achieve the best outcomes. This includes:

  • supervising entities on an ongoing basis
  • undertaking risk-based surveillances that target specific incidents or transactions
  • undertaking thematic reviews that focus on issues across a particular sector
  • commissioning reports
  • enforcing the law.

Our threat, harm and behaviour framework identifies regulatory risks in the market to inform the strategic priorities in our corporate plan. This helps us prioritise enforcement and other regulatory actions targeting particular harms to investors, consumers and markets.

Our Emerging Threats and Harms Committee is a key component of ASIC’s broader risk management framework. This Committee of Commissioners and senior ASIC leaders helps ASIC:

  • identify, monitor and advise on emerging risks, including product or sector risks relevant to our strategic priorities
  • review the perimeter of our regulatory responsibilities for regulatory gaps not subject to appropriate regulation
  • monitor key changes to the priority harms that can cause harm to investors, consumers and the markets and sectors we regulate.

When we identify a potential breach of the law or a risk or cause of harm, we will determine the most appropriate response. Broadly, we consider the following factors in deciding which regulatory tool or tools we will use:

  • the matter’s strategic significance (the seriousness of the misconduct or harm, how widespread it is, the importance of deterrence, and our strategic priorities)
  • the likelihood of success of using one or more of the tools available to us
  • the issues specific to the case (e.g. availability of evidence)
  • the benefits of pursuing misconduct (e.g. the impact of remedies we may be able to obtain to deter misconduct and protect or compensate consumers, and other public interest factors)
  • the availability of resources.

Our legislative responsibilities

The Australian Securities and Investments Commission Act 2001 (ASIC Act) requires ASIC to strive to:

  • maintain, facilitate and improve the performance of the financial system and entities within it in the interests of commercial certainty, reducing business costs, and the efficiency and development of the economy
  • promote confident and informed participation by investors and consumers in the financial system
  • administer the law effectively and with minimal procedural requirements
  • receive, process and store – efficiently and quickly – the information we receive
  • make information about companies and other bodies available to the public as soon as practicable
  • take whatever action we can, and which is necessary, to enforce and give effect to the law.

We monitor and promote market integrity and consumer protection in relation to the Australian financial system and payments system.

We enforce the law and regulate companies, financial markets and financial services under the following key legislation:

  • ASIC Act
  • Business Names Registration Act 2011
  • Corporations Act 2001 (Corporations Act)
  • Insurance Contracts Act 1984
  • National Consumer Credit Protection Act 2009 (National Credit Act).

We also administer parts of the following legislation:

  • Banking Act 1959
  • Life Insurance Act 1995
  • Medical Indemnity (Prudential Supervision and Product Standards) Act 2003
  • Retirement Savings Accounts Act 1997
  • Superannuation (Resolution of Complaints) Act 1993
  • Superannuation Industry (Supervision) Act 1993 (SIS Act).

Oversight

Responsible Ministers

At 30 June 2019, the Ministers responsible for ASIC were the:

  • Treasurer, the Hon. Josh Frydenberg MP
  • Assistant Treasurer and Minister for Housing, the Hon. Michael Sukkar MP
  • Assistant Minister for Superannuation, Financial Services and Financial Technology, Senator the Hon. Jane Hume.

Parliamentary oversight

The Parliamentary Joint Committee on Corporations and Financial Services (PJC) provides parliamentary oversight of ASIC. We also appear before the Senate Standing Committee on Economics, the House of Representatives Standing Committee on Economics, and other parliamentary committees and inquiries as required.

Correspondence with members of Parliament

ASIC receives correspondence from members of Parliament, both directly and indirectly through requests from Treasury.

We aim to respond to 100% of correspondence within 28 days of receipt. In 2018–19, we responded to 265 letters and emails from members of Parliament. We responded to 91% of this correspondence within 14 days and 100% within 28 days.

Financial and operational oversight

ASIC is a non-corporate Commonwealth entity under the Public Governance, Performance and Accountability Act 2013 (PGPA Act), which primarily governs our use and management of public resources.

The PGPA Act also requires ASIC to prepare a corporate plan covering our purpose, environment, performance, capability, and risk oversight and management for the budget forward estimates period. ASIC’s Corporate Plan 2018–19 to 2021–22 was published on 31 August 2018.

The Auditor-General audits our annual financial statements on behalf of the Parliament.