Regulators need deeper focus on finance competition: Senate committee

He suggested that new metrics to measure regulator effectiveness would be needed; for example, the number of meetings ASIC holds with start-ups was much less relevant than how many start-ups are getting off the ground and becoming viable businesses.

With Treasurer Josh Frydenberg saying on Friday that the government would extend its leniency on changes to the Corporation Act made during the crisis to allow for the digital execution of documents and meetings, Senator Bragg said the Treasurer recognised the changes should become permanent. Using digital signatures and allowing for digital meetings were “must dos in 2005”, he said, but the coronavirus crisis had finally provided the impetus for change.

The move is supported by the Australian Banking Association, Business Council of Australia, Australian Institute of Company Directors, Council of Small Business Organisations, Financial Services Council, Real Estate Institute of NSW and the Australian Property Institute.

With many young companies telling the inquiry that it was unclear whether the R&D tax concession applied to software development, Senator Bragg said it was “important to land something substantive” on R&D in the committee’s interim report. It is also considering “tweaks” to the Early Stage Venture Capital Limited Partnerships regime to encourage more capital into the start-up sector.

As the government rolls out the consumer data right with open banking, the committee has heard concerns that the process of “screen scraping” of data after passwords were shared would be stopped. But Senator Bragg said the committee, which will publish an interim report for the government in late August, was likely to call for scraping to be allowed to continue in parallel with the consumer data right.

“There has been no evidence to suggest, which I believe is compelling, that [screen scraping] should be abolished,” he said.

On the buy now, pay later sector, the committee will provide a view on the new industry code of conduct, which Afterpay, Zip and other players are developing.

One-size-fits-all regulatory frameworks are “fraught and dangerous”, and Senator Bragg said self-regulation – in response to an earlier Senate committee recommendation – was an important step as the sector matures. Buy now, pay later was “an important case study on how we look at innovative change,” he said.