The Financial Services Council is calling for ASIC and APRA to face consequences for failing to cooperate with one another.
In a submission to Treasury on exposure draft legislation for the Financial Regulator Reform (No.2) bill, the FSC said it generally supported the bill in its intention to compel ASIC and APRA to cooperate with one another in overseeing the financial services industry given the recently enhanced Memorandum of Understanding between the two regulators.
However the council also pointed to a number of areas where the bill could be improved, recommending it become mandatory for ASIC and APRA to collaborate on information, documentation and data requests and collection where reasonably practicable.
Additionally, the FSC said the regulators should be required to seek the same information from industry participants in the same format and with common definitions.
The FSC also wants to see ASIC and APRA face consequences should they fail to cooperate with one another.
The Council commented that the legislation establishing the Financial Regulator Oversight Authority - set to be consulted on and introduced by June 30 - should be "sufficiently robust so that where a regulator breaches its statutory obligations in relation to information, there are real consequences of such actions".
"We will provide comments on this aspect when the consultation draft is made available," the FSC said in its submission.
The FSC also recommended the oversight authority commences operations at the same time the bill commences, given it will oversee compliance with the new obligations under the bill.