Discretionary powers – wholesale foreign financial services providers

A NEW policy statement has been released that relates to the entry of foreign providers of wholesale financial services that are regulated by overseas regulatory authorities into the Australian market.

Australian Securities and Investments Commission executive director policy and markets regulation Malcolm Rodgers said under the policy statement the commission would allow a foreign financial services provider to offer their services to wholesale clients in Australia without first gaining an Australian financial services licence, providing the regulation of the provider is "sufficiently equivalent to our own".

"Relief from the AFS licensing requirements will be subject to a two-pronged equivalence test," he said.

The policy statement gives full effect to ASIC’s Principles for cross border financial services regulation which were issued in November and recognises that in order to remain at the forefront of global financial services regulation, the commission must produce sensible and facilitative policy that reflects the globalisation of financial services.

"The policy statement has been developed after consultation with industry participants and organisations following the release of ASIC’s policy proposal paper in December," Mr Rodgers said.

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