The Federal Government has curtailed the Australian Prudential Regulation Authority's (APRA) powers to disqualify company executives nearly two years after the case that prompted a review.

Amendments to the Insurance Act introduced into Parliament last week requires APRA to go to court if it wants to bar individuals from director and officer roles.

The changes align APRA more closely with its co-regulator, the Australian Securities and Investments Commission, which also must apply to the Federal Court to have executives disqualified.

The amendments, which were mooted late in 2006, follow a vigorous campaign by life insurer Axa Australia to reduce APRA powers following the disqualification of then CEO heir-apparent Andrew Penn.

Mr Penn had to stand down as head of Axa Asia Pacific in September 2005 after an APRA investigation found the staff superannuation fund's board of trustees had failed to keep employees informed about changes to the fund. Mr Penn was a trustee.

He was sidelined for nearly 11 months while Axa spent a reported $20 million fighting to have him and six other trustees reinstated.