Standards development MoU between New Zealand’s Financial Reporting Standards Board (FRSB) and Australian Accounting Standards Board (AASB) Product Safety Standards Consumer Safety Standards Enforcement Assistance in gathering evidence and enforcing compliance MoU between the Securities Commission and ASIC appointments Arrangements for New Zealand membership of Australian institutions, and vice versa New Zealand and Australian Takeovers Panels Accounting Standards Review (ASRB) and Financial Reporting Council (FRC) FRSB and AASB Bilateral undertakings may need to be facilitated by changes to domestic law. For example, New Zealand’s Securities Act has been amended to give the Securities Commission the right to exchange information with overseas counterparts, which includes ASIC, thus making possible the MoU between the two Commissions that provides for mutual assistance in relation to enforcement activities. They may also provide the framework and impetus to develop legally binding instruments. For example, the recently agreed mutual recognition agreement on securities offerings has been on the action agenda of the MoU on Business Law Coordination, is based on the principle that ‘for each particular situation a firm will only have to comply with one set of rules, have certainty as to the application of those rules in the other jurisdiction, and which regulator it needs to deal with’. Bilateral legally binding commitments Bilateral legally binding commitments, contained in Treaties and reflected in domestic laws embody a strong commitment to reciprocity; provide the greatest certainty of outcomes (e.g. common food standards developed by FSANZ) and are the most durable cooperative arrangements (given the potentially high cost of extracting from them). For these reasons, they also significantly reduce each country’s ability to determine its own policy and regulatory settings. Further, experience has shown that there can be practical difficulties in developing arrangements given differences in underlying legal frameworks and public sector management systems. Examples of bilateral legally binding commitments include: Explanation Examples Administrative arrangements New Zealand or Australia contracts with the government to provide services on its behalf A contracting option is under consideration in relation to patent examinations Harmonisation New Zealand and Australia harmonise standards/rules but maintain independent enforcement/implementation institutions Food standards Mutual support New Zealand and Australia include provisions in legislation or by agreement requiring each regulator or other agency to avoid actions (including policy Legislative changes proposed by the Council on Banking Supervision
Ways of working across government and across the Tasman All government agencies with an interest in a proposal should be identified early in the process, especially central agencies and those with a role in the relevant governance policy. A means of conducting officials’ processes has to be devised which can also keep working teams manageable in size, co-ordinated and quickly responsive: Establish a project plan that everyone is committed to, with latitude for creative flexibility as necessary. Strong commitment to processes that to bear a whole of government perspective: The time and resources to complete a project of this kind cannot be overestimated. Issues can arise that may involve agencies that were not anticipated at the outset. There may well be value in more generally informing agencies about the proposed body, to seek early expressions of interest or advice. Establish a dedicated project team, with leadership and authority to co-ordinate and act. Establish a key department with the authority to bring the right people to the table. Ensure that the right people of sufficient seniority are at the negotiating table and empowered to take decisions. Clearly establish who the key officials are, particularly when not dealing with matching departments in each country. Typically, relevant bodies include the agency with prime domestic responsibility for specific issues and those with broad experience in trans-Tasman coordination efforts. Approaches to negotiations Officials should be aware of the relevant political realities of both parties in the negotiations and have an appropriate and clear mandate. The first stage should involve: Confirming clearly the objectives of the exercise and the scope of political authority. Both countries gaining an understanding of how the government and business in each country operates in practice, as well as in theory. Building a good understanding of each others’ institutional frameworks to support more open perspectives on governance options. Obtaining independent advice/information on industry views and the market situation in each others’ countries. Building a good understanding of our respective systems which, although quite similar, are different in a number of important respects that can have implications if seeking to harmonise particular legislation.