FMA’s Hughes proposes single trans-Tasman markets regulator
BUSINESSDESK: A single regulator for financial markets in Australia and New Zealand would help market participants and investors in both countries, Financial Markets Authority chief executive Sean Hughes says.
"The potential benefits of integration for market participants are high, through reduction of complexity, increased certainty and lower costs of compliance," he says in a submission to the Australian and New Zealand Productivity Commissions.
A worthy goal would be to achieve a single licensing and product disclosure regime for the two countries, "bringing total portability for services, products and providers".
"Ideally, this would be supported by a single trans-Tasman business registry, giving one-stop access for market participants and the public."
In the submission, entitled Strengthening Economic Relations between Australia and New Zealand, Hughes says he appreciates a single regulatory approach straddling the two countries "can raise issues of sovereignty and political accountability, or at least the perception of such".
But the benefits include providing a system that businesses and investors find familiar and cost-effective.
Australia has consolidated its registration functions, corporate regulation, consumer credit, financial literacy and financial crime investigation within the Australian Securities and Investments Commission.
In New Zealand, there is less consolidation.
The FMA is the principal regulator of investments and investment markets but shares responsibility for registries and enforcement with the registrar of Companies and the Serious Fraud Office, while the Commerce Commission has oversight of consumer credit contract regulation.
Mr Hughes says despite these differences, "the appetite and potential for harmonisation is high".