Call for widening of international securities agreement

New Zealand investors would ideally have the opportunity to access American securities and those issued out of more developed Asian countries such as Singapore and Hong Kong without the need for additional regulation in the next 15 years, the head of the country's investment watchdog says.

Speaking at the Trans Tasman Business Circle meeting in Auckland yesterday, Securities Commission chairwoman Jane Diplock said the mutual recognition of securities agreement signed between New Zealand and Australia in June last year had been a resounding success and she believed it would be the way of the future.

"Where do I see things going in 15 years' time? I would hope to see a networked agreement across the Atlantic, New Zealand and Australia connected to Asia and I would like to see us part of a networked relationship between Australia and the United States."

The transtasman agreement means issuers of investment products have only to meet the regulations of their home country before they are able to offer the product in the other.

Diplock said this lowered the regulatory burden and offered a wider choice of investments without increasing the risk to investors. But research to be released this week by ASIC - the Australian version of the Securities Commission - shows it has so far been far more advantageous to Australian issuers.

The Australians have bought 253 products to the New Zealand market using the new regime while New Zealand companies have taken only seven across the Ditch.

That potentially meant New Zealand businesses were missing out on the work associated with an investment issue, said Diplock..

But from her point of view it could only be good for investors to gain access to more choice.

Diplock said the mutual recognition of securities agreement also paved the way for transtasman regulation of financial advisers.

Australia has regulated its advisers for some time but new laws regulating New Zealand advisers will not come into effect until the end of next year.

Diplock said Australia's parliamentary joint committee of financial advisers was due to report next month and that could be the perfect moment to begin talks that would allow advisers to work across both countries.