In a joint submission to the Australian Law Reform Commission (ALRC), associations including the FPA, Chartered Accountants Australia and New Zealand (CA ANZ), IPA, CPA Australia and the SMSF Association explained that duplicated requirements in the Corporations Ac 2001 are negatively impacting advisers and advice.
FPA chief executive Sarah Abood noted financial planners are faced with regulatory duplication created by both the structure of the legislative hierarchy and the obligations contained in the financial advice-related provisions.
“This significantly and negatively impacts the affordability and accessibility of financial advice for consumers,” said Ms Abood.
Both the ALRC and QAR reviews, she said, highlight that duplications in the law exist on two levels:
- Unnecessary repetition of identical provisions such as those identified in Interim Report B
- Specific obligations placed on the same provider through multiple applications of ‘like’ obligations, such as the financial advice requirements on financial planners
“This duplication is made worse, as the obligations placed on financial planners under the Corporations Act 2001 licensee obligations and the Financial Planners and Advisers Code of Ethics 2019 are heavily influenced by the licensee and others who often then apply additional requirements to financial planners,” she said.
The joint submission stated that the ALRC package of proposals to simplify the legislative hierarchy to improve navigability of the law and remove duplication is vital to the success of the recommendations of the QAR.
The joint associations stated in the submission that they support Recommendation 14 in Interim Report B which calls for redundant and spent provisions in the corporations and financial services legislation to be repealed.
They also support Recommendation 15, which would see ASIC and Treasury establish an ongoing program to ensure redundant and spent provisions continue to be identified and repealed.
“It is important that the Office of Parliamentary Council (OPC) and Treasury continue the positive engagement they have established with industry, including the Joint Associations, as part of their existing law improvement program to identify and repeal redundant provisions,” the joint submission stated.
“Given the pace of legislative development, we believe this process should ideally be conducted annually or at a minimum bi-annually.”
Ms Abood said she would like to see the ALRC “prioritising recommendations relating to financial advice in its Final Report to Government and include its considerations for the implementation of its recommendations and proposed legislative hierarchy by government, Parliament, and regulators”.
