Government applauds ASIC’s red tape reduction unit

The creation of the Australian Securities and Investment Commission’s (ASIC) regulation unit is being viewed as “another step forward” to improve regulatory alignment and cut red tape.

“I want all Australian households to have access to affordable, high-quality financial services and advice,” Minister for Superannuation, Financial Services and the Digital Economy Jane Hume said.

“The creation of this unit, alongside the $46 million of relief the government announced this morning for financial advice, [is an important step] forward for Australian businesses.” She also referenced the lump sum that the freeze on ASIC’s financial adviser levy advisers are expected to save.

Noting that regulators are “at the centre” the government’s deregulation agenda, Ms Hume said that “all regulators need to set clear expectations and what best practice looks like”.

This unit, outlined in ASIC’s 2021–25 Corporate Plan, is expected to identify and implement changes to how ASIC administers the law.

Among other things, ASIC has committed to providing clear guidance and communication on how it will exercise its powers, alongside “actively and transparently” engaging with stakeholders when making regulatory decisions.

It is also set to administer “an enhanced regulatory sandbox” to allow the testing of certain innovative business models without first having to obtain an AFS or credit licence.

On Monday, Treasurer Josh Frydenberg announced “temporary and targeted relief” for financial advisers by cutting the cost of recovery levies charged by ASIC.

The current relief will see ASIC levies charged per licensee remain at $1,500 — a substantial reduction relative to the level estimated in ASIC’s 2020–21 Cost Recovery Implementation Statement of $3,138 per adviser.

This would ultimately see ASIC levies charged for personal advice to retail clients restored to their 2018–19 level of $1,142 per adviser for the next two years (relating to 2020–21 and 2021–22).

“The freeze in the per-adviser levy will provide financial advisers with the certainty they need over the next two years to deal with the impacts of COVID-19 and further regulatory reforms making their way through the Parliament, including the introduction of a single disciplinary body and a compensation scheme of last resort,” the Treasurer said.