Submissions call for rewrite of FMA’s draft guide about outcomes focused regulation
The Financial Markets Authority (FMA) has released the submissions relating to it’s draft ‘Fair outcomes for consumers and markets’ guide. Chapman Tripp and Dentons Kensington Swan submissions have been released and both critique the guide, with both law firms arguing that implementing outcomes-based proposals will impose confusing and expensive compliance duties of market participants – with no legal basis.
Criticisms include the guide being unclear on how outcomes focused regulation supports regulatory compliance; the draft guide being too vague to be readily applicable; the lack of tying high level outcomes back to actual legal requirements; and some of the draft guide lacks the authority of Parliament and risks being unenforceable or amendable to judicial review.
Suggested improvements include clarifying the scope and targeted market sector of each proposed outcome; providing detailed examples of how businesses can comply; adding more examples of expected compliance behaviour; and identifying when compliance with existing legislative requirement is sufficient to ensure delivery of fair outcomes.
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