Senator the Hon Nick Sherry, Minister for Superannuation and Corporate Law, has today welcomed the release of the joint Treasury-ASIC consultation paper Cross Border Recognition: Facilitating Access to Overseas Markets and Financial Services which will provide the framework for Australian investors to more effectively access other well regulated capital markets, advisers and products.
Under existing arrangements, Australia can unilaterally grant recognition to foreign financial markets, advisers and collective foreign investment schemes to operate in Australia. However, the consultation paper has identified some scope for improvements to the administration of the existing regime, including a new framework for mutual recognition.
"The measures canvassed in the consultation paper are to fine-tune Australia's unilateral recognition mechanisms that apply to foreign financial markets, advisers and products. This fine-tuning will preserve regulatory protection for investors and preserve the greater choice and competition provided by foreign entities operating in Australia."
"Importantly, the consultation paper will assist the development of a framework for mutual recognition of securities regulation for use in agreements between Australia and other countries with well regulated financial markets," Minister Sherry said.
While Australia is negotiating a world first mutual recognition of financial securities arrangement with the United States and last week brought into force a comprehensive mutual recognition of securities offerings with New Zealand, mutual recognition remains an emerging policy area where Australia can clearly state its position to other countries.
"This framework will reduce red-tape in cross-border transactions while ensuring that regulatory safeguards to protect Australian consumers are underpinned by strengthened coordination and cooperation arrangements," Minister Sherry said.
The finalised mutual recognition framework will outline how Australia can obtain significant benefits from cross border capital flows while ensuring investor protection and market integrity.
"Cross border recognition of financial regulation is another example of the Rudd Government's commitment to modernising Australia's financial system and delivering on our commitment to make Australia a financial hub."
Additional information can be found on the ASIC website: www.asic.gov.au.