ASIC has today released updated guidance for industry on making notifications to ASIC under the reportable situations regime (formerly breach reporting).

The updates to Regulatory Guide 78 Breach reporting by AFS licensees and credit licensees (RG 78) clarify aspects of the existing guidance and provide new guidance in response to operational issues that have arisen since the implementation of the regime on 1 October 2021.

ASIC Executive Director (Acting), Financial Services & Wealth, Suneeta Sidhu said, ‘Our focus is to improve consistency and quality of reporting practices by licensees and reduce regulatory burden where we can. The improved guidance will support industry to meet their obligations, and support the regime to meet its policy objectives for ASIC, industry and consumers.

‘We acknowledged early on that there were some implementation challenges with the regime. Our updated guidance has been developed following consultation with industry on practical solutions to some of these challenges,’ concluded Ms Sidhu.

ASIC has updated the guidance following analysis of reports received, and in response to direct feedback from industry and other stakeholders to clarify the requirements for licensees. This includes targeted consultation that considered feedback from a variety of industry associations from the banking, insurance, superannuation, financial advisers, markets and credit sectors.

The updates to the guidance are intended to support the use of the data for ASIC’s regulatory purposes and public reporting, as well as to reduce regulatory burden on industry where possible. 

The updates to RG 78 include:

• clarifying the circumstances in which licensees may group multiple reportable situations into one report to ASIC;
• new guidance on the information to include when licensees describe a reportable situation; and
• new guidance for licensees on ASIC’s expectations when licensees are providing updates related to a reported breach.

ASIC is also making minor changes to the prescribed form for lodging reportable situations (accessed using the Regulatory Portal). These changes will be implemented on 5 May 2023, and will clarify how some questions should be answered and point licensees to guidance available in RG 78.

ASIC published a summary of the changes that it has made to RG 78 today and will be making to the prescribed form on 5 May 2023.

Through our engagement with industry, we are aware of other issues raised regarding the operation of the reportable situations regime. ASIC’s work on these other matters is ongoing, and we expect to undertake further consultation with a range of stakeholders.

Background

The reportable situations regime is a cornerstone of the financial services regulatory structure and the reports are a critical source of regulatory intelligence for ASIC.

The lodgement of reports by licensees under the reportable situations regime provides a critical source of intelligence to enable ASIC to identify emerging trends of non-compliance in the industry. It also allows detection of significant non-compliant behaviours early, facilitating prompt regulatory action where appropriate.

As part of its 2022-23 priorities, ASIC announced it would focus on improving the operation of the reportable situations regime.

In addition to engaging with industry on challenges arising from implementation of the regime, ASIC has also:

• delivered an interface to facilitate more efficient machine to machine reporting from licensees under the regime
• delivered ASIC’s first public report under the new regime.

ASIC will continue its focus on the operation of the regime, and ensuring it meets policy objectives for ASIC, industry and consumers.

Among other things, in 2023 ASIC will consult on its proposed approach to public reporting at a more granular level for the 2024 report and beyond.