Regulatory recognition that will allow Australian and New Zealand brokers to practise on both sides of the Tasman may be as little as 12 months away, according to Financial Markets Authority (FMA) CEO Sean Hughes.

The New Zealand-born former Senior Executive Leader Corporations at the Australian Securities and Investments Commission says the Australian Government “has seen the changes coming about” through New Zealand regulatory reform process.

“There are very positive signals that they’re coming to the view that mutual recognition is not just a possibility, it’s a probability,” he told insuranceNEWS.com.au.

Speaking at the Insurance Brokers Association of New Zealand conference in Auckland last week, Mr Hughes explained the various ways the new FMA will undertake enforcement and market surveillance.

He says the New Zealand legislation under which the FMA operates is different from the Australian model.

“In the financial advisory space we’ve taken a different approach by licensing and supervising the individual and the entity, not just the entity as is the case in Australia.”

He estimates Australia’s regulatory experience for regulating financial advisers like brokers is “about 10 years ahead of New Zealand”.

“But that is not a criticism, merely a statement of where we are at. We are catching up and we will… in time deliver a model that is best for New Zealand and its situation.”

He says some New Zealand brokers have proved resistant to the move to a regulatory regime “and don’t want to change their old habits. That’s not surprising when they’ve not been regulated before. But others are positive and have embraced regulation.”