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Asic to reduce regulatory burden on exports
11 July 2014
Regulator also keen to remove entry barriers for foreign financial services firms, Ged Fitzpatrick told delegates at the Global Investor/ISF Master Class Australia in Sydney
Australia's corporate regulator, the Australian Securities
and Investments Commission (Asic), has said it will do all it
can to reduce the regulatory burden on Australian financial
services companies looking to export their services.
"We've long had a policy to do what we can to reduce those
burdens and one way we can do so is by recognition, preferably
on a mutual basis, of foreign regulatory requirements," Asic
senior executive leader investment managers and superannuation,
Ged Fitzpatrick, told the Global Investor/ISF Master
Class Australia in Sydney on July 9.
One initiative by the Australian government has been the
development of the Asia Region Funds passport. The passport is
in the consultation phase but government agencies in Australia,
Korea, New Zealand, The Philippines, Singapore and Thailand are
"The passport will provide an opportunity to remove barriers to
entry for foreign firms by changing asset management
regulations to limit the extent to which different requirements
in each economy in which a fund is offered have to be
followed," Fitzpatrick said.
But he also told delegates that Asic is focusing on a number of
areas with regard to the increased regulatory burden on
industry participants. For example, responsible entities also
holding a Responsible Superannuation Entity licence will, from
July 1 next year, be required to comply with requirements from
both Asic and the Australian Prudential Regulation Authority,
which regulates overseas financial institutions and super
Asic's concerns center on responsible entities understanding of
"adequate risk", which is not explicitly defined in the
"On further investigation we found these smaller [responsible
entities] had different interpretations of what was adequate,"
The regulator issued a consultation paper on the risk
management systems of responsible entities and has considered
the responses it has received to that submission, but is
awaiting the outcome of the current Financial System Inquiry
before it issues regulatory guidance.
That inquiry, the first of this kind since 1997, has extensive
terms of reference and will affect many in the industry in
Australia. An interim report is expected shortly with a final
report due by the end of this year.
Another area that is drawing Asic's attention is the
portfolio holdings disclosure regime that requires Australian
pension funds to disclose more granular information about their
The disclosure of unlisted assets and hedge fund holdings, and
the investments in those holdings, has been an area of concern
for the industry, where disclosure could impact