Sydney, 16 November, 2006: The Australian Bankers’ Association (ABA) has welcomed the Corporate and Financial Services Regulation Review Proposals Paper launched today by the Parliamentary Secretary to the Treasurer, the Hon. Chris Pearce. 

The ABA said Mr Pearce is to be commended for his constructive approach in working to address concerns with unintended and unnecessarily complex consequences arising from the financial services reform (FSR) and other amendments to the Corporations Act.

Ian Gilbert, Acting Chief Executive of the ABA, said: “While much of the detail in the Federal Government's package of proposed amendments still has to be worked through by the financial services industry, the proposals, which will form the Simpler Regulatory System Bill, are welcome.”
 
“The proposals are designed to provide a balance between consumer protection in relatively straightforward financial situations while at the same time reducing costs and complexity for both consumers and industry.”

First, the proposals paper includes measures to address some of the uncertainties surrounding the financial product advice regime in a sales environment. Secondly, it proposes to reduce the potential costs to small investors of financial advice by removing the Statement of Advice requirement for investment amounts of $10,000 or less, except for superannuation. Thirdly, it proposes to provide a mechanism to better accommodate investors who are properly characterised, or wish to be characterised, as wholesale clients.
 
The proposals also seek to enable FSR and corporations legislation to improve the balance between costs and efficiencies and the need for consumers and investors to receive relevant and timely information. For example, the paper includes proposals to remove inconsistency between certain corporate reporting obligations as well as encourage greater adoption of electronic distribution.

ENDS