ASIC and Treasury told to be realistic
The Australian Securities and Investments Commission (ASIC) and the Treasury have been told to become more realistic about the time-frames required for financial services companies to implement major legislative or regulatory change.
The regulator and the Government have been told that recent experience of unrealistic time-frames around regulatory change had taken its toll on the industry in terms of cost and uncertainty.
The point has been driven home by the Association of Superannuation Funds of Australia (ASFA) in a submission to ASIC on proposed performance metrics for the major financial services regulators.
Referencing what represents one of the biggest bug-bears for financial services companies regulated by ASIC, ASFA said, "probably the biggest complaint that we have received from our members is that there is not always sufficient time, certainty and clarity provided to industry to properly prepare for changing legal, compliance or reporting requirements".
"For example, on numerous occasions the industry have undertaken significant work to prepare for pending requirements on a tight timeframe, only for ASIC to postpone the requirements, sometimes at the last minute, in response to industry implementation concerns," it said.
"While generally the delays provided by ASIC are appreciated and necessary, the uncertainty creates a regulatory burden in that funds are either preparing for uncertain rules (which is generally ill-advised and potentially very expensive) or are operating in an environment where they are uncertain if they are likely to become uncompliant if the regulator does not delay the change," it said.
Citing previous examples, the submission said a better approach would be for the regulators and Treasury to adopt more realistic implementation timeframes.
"A metric that captures and measures this would be helpful," it said.
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