Corporations Amendment (Portfolio Holdings Disclosure) Regulations 2021 – regulation memo

On 11 November 2021, Australia’s Portfolio Holdings Disclosure (PHD) legislation was published via an amendment to the Corporations Act 2001, under Section 1017BB.

On 11 November 2021, Australia’s Portfolio Holdings Disclosure (PHD) legislation was published via an amendment to the Corporations Act 2001, under Section 1017BB.

About the Portfolio Holdings Disclosure

The Corporations Amendment (Portfolio Holdings Disclosure) Regulations 2021 outline the manner in which registered superannuation entities (RSEs) are to disclose their portfolio holdings and valuations.

The PHD regulation outlines the manner in which holdings are to be reported.

Twice-yearly reporting is required at the investment level as at 31 December and 30 June each year and must be made available on the RSE’s website within 90 days thereafter.

Schedule 8D of the legislation outlines the four tables to be completed for each investment option.

  • Table 1: Total assets
  • Table 2: Derivatives by kind of derivative
  • Table 3: Derivatives by asset class
  • Table 4: Derivatives by currency

In addition, the PHD regulation introduced the aggregation of assets as follows:

  • Internally and externally managed investments
  • Unlisted directly owned assets
  • Non associated entities
  • Derivative valuation and weighting reporting

In conjunction with the legalisation released in November 2021, the Treasurer also issued an explanatory memorandum providing further clarification in regards to the reporting requirements as well as the reporting items, such as the split between internally and externally managed investments.

Our industry body, the Australian Custodial Services Association (ACSA), has prepared and released to market a Practice Guide on the Implementation of Portfolio Holdings Disclosure (PHD) Reporting.

This guide was developed after a programme of work undertaken by ACSA with both the Australian Prudential Regulation Authority (APRA) and the Australian Securities & Investments Commission (ASIC).

Industry implications

The new legislation requires mandatory disclosure of portfolio holdings and valuations. As such, each RSE has had to examine their current reporting processes and implement the required changes which allows them to display the investment holdings on their public websites.

BNP Paribas Securities Services’ view

BNP Paribas has a team of local regulatory experts to guide clients on their reporting requirements under the new PHD and existing regulations.

Josephine Maiorana, Head of Regulatory Watch and Market Advocacy, Asia Pacific at BNP Paribas Securities Services, recently held a client update on the upcoming Portfolio Holdings Disclosure Reporting obligations and can be contacted for more details.

References taken from:

1. Corporations Amendment (Portfolio Holdings Disclosure) regulations 2021

2. Explanatory Statement – Issued by Authority of the Treasurer – Corporations Act 2001