The most comprehensive package of corporate law reform proposals since the commencement of the Corporate Law Economic Reform Program (CLERP) was announced by Chris Pearce today. These proposals will form part of a single Bill to be introduced into the Parliament titled the Simpler Regulatory System Bill as a result of extensive consultation and submissions to improve the Corporate and Financial Services sectors.
“In April, I released a wide-ranging set of possible reform options for public feedback, in the area of corporate and financial services regulation,” Mr Pearce said.
“I am very pleased to be able to announce progress on these important reforms following the success of this initial consultation process. Most of the topics can be implemented through regulation or legislation and in the near term.”
Mr Pearce said he was encouraged by the overwhelming response to the Consultation Paper, noting that more than 80 thoughtful and substantial submissions were received from a wide range of individuals and organisations.
“We received submissions from consumer and industry organisations, academics and individual practitioners. Importantly, many submissions applauded the Government on its commitment to tackling the regulatory burden and for getting on with the job.
Mr Pearce explained that the Government will progress the reforms principally through the Simpler Regulatory System Bill. In preparation for the Bill, round-table consultations will begin shortly to settle the proposed measures it will contain.
“Some of the more minor technical changes can be put in place quickly through regulation. These regulations will be released soon for consultation before being implemented.
“To assist the round-table consultations on the preparation of the Simpler Regulatory System Bill, I intend to release a paper in September that will enable comment on defined proposals and their benefits. I am pleased that the Australian Securities and Investments Commission will be closely involved in developing and refining these proposals,” Mr Pearce said.
“There were several topics - in particular, the role of a business judgment rule and the need to facilitate product rationalisation - which merit a more focused approach, because of the scope and complexity of the policy issues they raise. The reform measures to be taken forward as separate focused projects will be progressed in parallel with the work on the Simpler Regulatory System Bill.
“In announcing these reforms, I build on my commitment to facilitate a simpler regulatory system that achieves continued consumer protection, reduced compliance costs, greater ability for companies to attract capital and, importantly, enhanced accountability of regulators,” Mr Pearce said.
Mr Pearce said that he was excited about the prospect of further red tape reductions being implemented in his area of the Treasury portfolio, following the success of the Refinements to Financial Services Regulation in 2005.
“My goal is to create the most efficient and effective regulatory system in the world and for our system to be used as a model platform to be exported within our region and throughout the global corporate and financial services sector,” Mr Pearce said.
A list categorising how the Consultation Paper topics will be handled in the work going forward is at Attachment A.
BACKGROUND
- The three categories for progressing the reform proposals are:
A. draft regulations for consultation;
B. proposals paper for consultation; and
C. focused projects for further consultation.
- In April 2006, Mr Pearce released the Corporate and Financial Services Regulation Review Consultation Paper for a six week consultation period, seeking comments on 56 separate topics. These issues included: company reporting obligations; corporate governance; further refinements to financial service regulation; and dealing with regulators.
The paper is available at www.treasury.gov.au.
CANBERRA
14 August 2006
Contact: Andrew Conway 02 6277 2088