Baker & McKenzie partner Astrid Raetze made the comments in response to claims by Labor Senator Sam Dastyari that ASIC had effectively given the “green light” to advice providers to breach their obligations under FOFA.
The corporate regulator announced on 20 December 2013 that it would not be enforcing the elements of the FOFA legislation the Government had previously announced it would repeal.
But during a Senate Economics Legislation Committee hearing last week, Mr Dastyari told ASIC representatives he was “shocked” the regulator was effectively making decisions about which parts of the law it intended to enforce.
“Frankly, to me this is a green light to be able to do what I want and completely ignore the FOFA changes,” he said.
But according to Ms Raetze, the decision by ASIC not to enforce the laws the government is intending to repeal represents a “sensible, commercial approach”.
“It indicates that ASIC recognises that there is little point in expending limited ASIC resources on enforcing law that is subject to change, and in fact may no longer exist in a few months,” she said.
In particular, a number of the laws that are subject to change or repeal by the government are not even set to come into force until 1 July 2014, said Ms Raetze.
For example, ASIC agreed to transition the new rules on performance payments to employees until the middle of next year – “by which time it is expected that the governments revision to FOFA will be effective”, she said.
The real motivation for Mr Dastyari’s comments may be that Labor’s “noses are out of joint” because elements of their legislation are being reversed, said Ms Raetze.
“[But] it’s not like the government’s reversing all of [the FOFA legislation] – they’re really just reversing the bits that were difficult and costly and didn’t necessarily add anything to the overall integrity and compliance of the law. I think they’ve improved [the FOFA regime],” she said.
