Legislation overload 'could have unintended consequences'
Transitional licensing opens next month under FSLAA.
At the same time, Conduct of Financial Institutions (CoFI) legislation is set to be introduced to Parliament in less than three months’ time, introducing new conduct obligations for banks, non-bank deposit takers and insurers.
Kensington Swan said the timing was “curious” and the new rules could add to the regulatory burden for a sector already “straining under the load of multiple regulatory reforms, reviews and investigations”, with the potential for unintended consequences.
“The financial sector has been investing significant resources in coming to grips with the regulatory burden and complexity that is being generated through the FSLAA reforms. That regime has been in development since 2016, with multiple exposure drafts and consultations to ensure the new regime has most of its kinks ironed out before implementation.”
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