Trans-Tasman Single Market Progresses

by Mary Swire, LawAndTaxNews.com, Hong Kong

15 April 2010

In a speech to the Trans-Tasman Business Circle in Auckland, New Zealand’s Commerce Minister, Simon Power, disclosed that the Trans-Tasman Outcomes Implementation Group (TTOIG) is making good progress on advancing the single economic market between Australia and New Zealand.

The TTOIG, an inter-governmental group, was formed to advance the regulatory outcomes identified by the two countries’ Prime Ministers, John Key and Kevin Rudd, in their joint statement of intent on the single economic market in August last year, and is due to report on its progress soon.

"This group will be reporting formally to me and my Australian counterpart, but I can report good progress in a number of areas," Power said.

He confirmed that the work towards a single cross-border insolvency proceeding, where an insolvent entity has interests in both countries, is on track, while good progress is being made on a single set of accounting standards for large Tier 1 for-profit entities. The latter may be achieved as early as the middle of next year.

In addition, equalization of the functions of the respective financial reporting standards bodies in Australia and New Zealand is also likely to be achieved by the middle of next year. This, he said, will secure deeper co-ordination in the future.

New Zealand's auditor and financial advisor regimes are being developed in a way that will support mutual recognition, and the work on providing for investors and other users of financial products in Australia and New Zealand to receive comparable disclosures is also progressing well.

Power pointed to the priority being given to arranging for comparable disclosures for managed funds. The majority of trans-Tasman issues making use of the mutual recognition of securities issues arrangements are managed funds, and the achieving of this outcome will aid capital-raising and investment in both countries. Also on track is the initiative that will allow trans-Tasman businesses to file company information only once to meet the requirements of both jurisdictions.

He reported that significant progress has been made in respect of intellectual property, which has the potential to substantially reduce business costs. The TTOIG is working towards a single application process for patents and alignment of trade-mark registration procedures, and a single regulatory framework for patent attorneys.

Power concluded his speech “by anticipating the question on whether a single economic market means a single currency, a common monetary policy, or harmonized tax regimes.” He said that it was premature to put these issues on the table. “It may be that as deeper integration evolves then these issues will require serious consideration,” he added. “On the other hand, they may, for a variety of reasons, never be considered a practical possibility.”

Recommended