Banking, Insurance and Life Insurance (prudential standards) determination No. 3 of 2011 - Prudential Standard CPS 510 - Governance
B. Governance arrangements — foreign ADIB. Governance arrangements — foreign ADIs, Category C insurers and EFLICs
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B. Governance arrangements – foreign ADIs, Category C insurers and EFLICs
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As in the case of locally incorporated regulated institutions, the ultimate responsibility for the safety and soundness of a foreign ADI or a Category C insurer resides with its Board. Foreign ADIs and Category C insurers must nominate a senior officer (whether a director or senior executive) outside Australia with delegated authority from the Board (senior officer outside Australia) who will be responsible for overseeing the Australian branch operation.
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For a foreign ADI or Category C insurer, there must also be a senior manager[6] in Australia responsible for the local operation who is ordinarily resident in Australia. The senior management must be available to meet with APRA on request.
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A Category C insurer that appoints a corporate agent as its agent in Australia must additionally ensure that:
(a) the Board of the corporate agent has a minimum of three directors at all times; and
(b) a majority of the directors of the Board of the corporate agent are ordinarily resident in Australia.[7]
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The ultimate responsibility for the safety and soundness of an EFLIC resides with its Board. An EFLIC must establish a Compliance Committee[8] to assist the Board in meeting its responsibilities under the Life Insurance Act. The requirements for the composition of the Compliance Committee are detailed in Attachment B. The senior management of an EFLIC must be available to meet with APRA on request.
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The senior officer outside Australia or Compliance Committee of an EFLIC, as relevant, must provide the external auditor of the regulated institution with the opportunity to raise matters directly with the senior officer outside Australia or the Compliance Committee, as relevant.