Australian financial regulator and OSC sign agreement to support innovative businesses
For Immediate Release OSC
Innovative fintech companies in Australia and Ontario will be able to draw on support from the combined resources of their financial regulators as they seek to operate in the others’ market, under a new agreement.
Under the agreement, signed in Toronto this week, the Australian Securities and Investments Commission (ASIC) and the Ontario Securities Commission (OSC) will refer to one another those innovative businesses seeking to enter the others’ market. The regulators may provide support to innovative businesses before, during and after authorisation to help reduce regulatory uncertainty and time to market.
The agreement follows the creation of the Innovation Hub at ASIC in April 2015 and the OSC LaunchPad in October 2016. These initiatives were established to help businesses with innovative ideas navigate financial/securities regulation, support them through the authorisation process and ease their engagement with the regulator.
Signing the agreement, John Price, ASIC Commissioner, said:
‘ASIC is committed to encouraging innovation that has the potential to benefit financial consumers and investors. Since we launched our Innovation Hub last year we have seen a surge in requests by fintech startups seeking assistance about how to navigate the regulatory requirements. These have covered a wide range of issues, as you would expect of such a young and exciting sector, but include robo or digital advice, crowd-sourced equity funding, payments, marketplace lending and blockchain business models. Some of these business concepts are already looking to expand internationally, and these agreements with like-minded regulators will be a significant factor in paving the way.’
Maureen Jensen, Chair and CEO of the OSC, said:
‘Last month, the Ontario Securities Commission unveiled OSC LaunchPad. This is the first dedicated team by a securities regulator in Canada to help fintech businesses navigate securities law requirements and accelerate time-to-market. Today’s agreement – another first for a Canadian securities regulator – reflects our commitment to improving the regulatory experience for emerging businesses that are offering innovative services, products and applications of benefit to investors.’
To qualify for the support offered by the agreement, innovative businesses will need to meet the eligibility criteria of their home regulator. Once referred by the regulator, and ahead of applying for authorisation to operate in the new market, the business will have access to dedicated staff that will help them to understand the regulatory framework in the market they wish to join, and how it applies to them.
ASIC and the OSC have also committed to share information on emerging trends in each other's markets and the potential impact on regulation.
In March 2015, ASIC announced that it would establish an online Innovation Hub to assist innovative fintech businesses navigate ASIC’s regulatory system. Through its Innovation Hub, ASIC engages with the fintech community, provides assistance to innovative fintech start-ups and liaises with fintech experts through ASIC’s Digital Finance Advisory Committee.
On October 24, 2016, the OSC announced “OSC LaunchPad” to engage with fintech businesses, provide the opportunity for support in navigating securities requirements and strive to keep regulation in step with digital innovation. This initiative supports innovation while fulfilling the OSC’s mandate to provide protection to investors and promote confidence in its markets.