INTHEBLACK December 2021 - Magazine - Page 41
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CPA Australia’s
Regulatory
Burden report
W
hy does it matter that the Corporations
Act contains more defined terms than
any other major piece of Australian
federal legislation?
According to research by Australian Law Reform
Commission (ALRC) legal officer Nicholas Simoes
da Silva, for every 3.41 words you encounter in the
Corporations Act, one will include a definition –
including even the word “of ”.
Definitions are present to explain specific meanings
that apply to the terminology either across the
legislation or in a particular context. A large volume
of definitions is just one example of why the modern
regulatory environment is so difficult for businesses
to navigate.
“Definitions represent hidden cross-references,”
says Simoes da Silva, who oversees the ALRC’s
quantitative research on the Corporations Act. “You
need to flick back, but [in the Corporations Act] you
may not even realise that you need to do so, because
the terms are not indicated.”
DEFINING “REGULATION”
Arie Freiberg, emeritus professor and former dean of
the Faculty of Law at Monash University, and author
of the 2017 book Regulation in Australia, is a longtime observer of the regulatory terrain.
While the traditional definition of “regulation” is
any rules that are endorsed by government when there
is an expectation of compliance, Freiberg’s broader
definition is “intentional form of intervention,
with the aim of achieving a public policy objective”.
In either case, “regulation” covers both the law
and the compliance mechanisms to enforce it.
BETTER REGULATION: WHERE TO BEGIN?
There is a strong argument that good regulation starts
with clear laws. In the wake of the Royal Commission
into Misconduct in the Banking, Superannuation and
Financial Services Industry, in 2020, the Australian
Federal Treasury commissioned the ALRC to review
the corporations law, a move that may eventually
provide some evidence for this argument.
However, attempts to improve regulation usually
focus on the compliance end of the process.
The unmet challenge is to balance the demands of
a complex society while keeping the regulatory burden
as light as possible.
“Yes, the amount of regulation just keeps growing,”
says Freiberg. “But we should remember there are
increasing risks in society, increasing harms. People
want to be protected.”
Closer collaboration from the very beginning of the
regulatory process is one way towards clear legislation
and fair compliance measures.
Professor Jeroen van der Heijden, chair in
regulatory practice at New Zealand’s Victoria
University of Wellington, supports this view.
“Partnerships between government, the targets of
regulation and the beneficiaries of regulation would
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