The Australian Government released the Report of the Taskforce on Reducing Regulatory Burdens on Business on 7 April 2006. The Report identifies a range of concerns relating to over-regulation and its effect on businesses across a broad range of industries, however, this update concentrates on issues of significance to the financial services industry. This update follows our detailed report on the Consultation Paper for the Corporate and Financial Services Regulation Review distributed to clients yesterday.
The Taskforce recognised that the financial services industry is heavily regulated and has high compliance costs following the introduction of the Financial Services Reform Act 2001 (FSR). Consequently, the Taskforce identified financial services as a priority area in order to improve regulatory mechanisms and outcomes.
The Report questions the effectiveness of existing regulations in achieving the desired outcome. One example given relates to current requirements for PDSs and disclaimers, which are said to make consumers more confused, making it difficult for them to compare products without seeking expert financial advice.
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