Speaking to InvestorDaily, Mr Lucas said the original conflicted remuneration rules related to general advice were effectively limiting consumer choice.
"FOFA, in its original [1 July 2013] incarnation, made it difficult and complex for boutique fund managers using responsible entities 'for hire' to promote their products to the retail community," he said.
The boutique manager's relationship with the responsible entity (who legally issues their product) along with the management remuneration paid to the fund manager were "far too complicated under FOFA", said Mr Lucas.
"It has meant restructuring business models to become FOFA-compliant as well as considering the benefits of actually pursuing retail money," he said.
The end result would have been a reduction in new products for the retail end of the market, said Mr Lucas.
But under the changes to FOFA announced by Assistant Treasurer Arthur Sinodinos on December 20, fund managers will now have more "flexibility" to determine whether or not they will promote their products to the retail side of the market, he said.
While all the fees involved will still have to be transparent, there is "no doubt [that] some in the industry will take issue with this", said Mr Lucas, "but I firmly believe it will encourage more innovation in the fund management industry as new bespoke managers emerge, providing more choice and products to the retail client."
