Our insights - Henry Davis York

The Wrap - August 2014

Spacer Panel

As we go to print on this edition of THE WRAP, the industry continues to digest a mix of developing regulatory and market related issues. Some of these have been brought to the fore in the interim report issued by the Financial System Inquiry. Other issues are connected to continuing regulatory reform agendas such as changes to the financial advice laws and Australia’s role in the Asia-Pacific region as a key financial services player. A further dimension has been placed on the reform process by the recomposition of the Senate and what that means for the
enactment of new laws.

In this edition of THE WRAP, we take a look at some of these developing issues and bring a focus on both regulatory and business trends affecting wealth management businesses:

  • The proposed rules for the Asia Region Funds Passport have been released. We ask 3 key industry players their views on whether the shape of the current proposals need to be changed in order to maximise the chances of success
  • Financial services providers are increasingly using technology to engage with their customers across an array of digital channels. We chart the developments in this space and consider the associated risks and opportunities from a legal and regulatory perspective
  • In light of the recent signing of the intergovernmental agreement between Australia and the United States, we work through the impact this will have on reducing the compliance burden on Australian financial institutions
  • The managed investment trust tax concessions are proving to have appeal to foreign investors. We untangle the criteria which need to be satisfied in order for an investment vehicle to qualify and the targeted tax outcomes to be achieved
  • Life insurers are using pre-existing medical condition exclusion clauses more often and in a wider range of life policies. The case law in this context needs to be navigated carefully and we explain how insurers should take care in how they rely on such clauses
  • Reforms to the OTC derivatives markets are being implemented in Australia. We set out the transitional rules and which institutions may be caught within the new requirements, which include transaction reporting.

We may not quite be there yet on implementation of a number of the continuing reform pieces. Partly this is a consequence of embedded transitional arrangements, which in some instances span years. Also, there has in some cases been a revisiting of policy settings, perhaps most notably through the amendments to the Future of Financial Advice laws.

Regardless, businesses will not be given the grace of ignoring these changes. As business confidence and activity increases, regulatory change may need to be accepted as a prevailing feature of the new environment or a “new normal”. It will be those businesses with the agility to adapt systems and operations to fit with changing settings which will stand greater chances of success. Equally, those which are not able to respond may find legal and regulatory risk in not facing up to the changes.

download the full publication to read on



Nikki Bentley


61 422 004 806

61 2 9947 6245



Ben Emblin


61 414 548 749

61 2 9947 6160



Jon Ireland


61 414 290 163

61 2 9947 6091



Greg Reinhardt


61 403 323 161

61 2 9947 6452



Jim Koutsokostas

Senior Associate

61 427 677 534

61 2 9947 6399


Other related insights