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Regulators and investigative bodies have extensive powers that can be brought to bear upon your corporation. Your corporation might come in contact with a regulator in the course of a voluntary inquiry. You may be on the receiving end of a compulsory process or examination. In serious cases your corporation may be the subject of a warrant. It may be advantageous for your company to take the time to engage with regulators and develop an effective working relationship outside of these serious processes. One of the best ways to do this is by building and maintaining a connection with regulators at a time when you are not directly engaged with a regulatory concern, so that they can get to know your organisation and your industry before any issues arise.
There is an opportunity to establish a relationship which may be beneficial for your company at a time when you are not directly engaged with a regulator.
Some regulators have semi-formal lines of communications to engage with Boards and senior management. Industry events also present opportunities to engage at a time when there is nothing specific on foot between you and the regulator. Whilst a regulator is likely to have a vast amount of information and established perceptions about your industry and its regulatory regime, they will also benefit from insights into what is happening within your business, the drivers for innovation, risks and opportunities in future. On the other hand, a regulator may share with you their enforcement and compliance priorities, and approach. It may pay dividends in future if the regulator gets to know you at a time when battle lines are not drawn.
Another opportunity to develop a relationship with a regulator is when there is a proposed change to regulation that affects your corporation. Typically, a planned regulatory change will involve a consultation process, with an invitation for input from affected stakeholders. Taking that opportunity not only gives your corporation input into future regulatory frameworks - tailoring the amendments as much as possible and highlighting any unforeseen consequences - but also demonstrates that your company takes regulation seriously, engages with regulatory reform and respects the role of the regulator in establishing its regulatory framework.
You might also consider making contact with a regulator on a proactive basis if a development or planned action on the part of your business may engage regulatory interest.
For example, if your company is proposing to embark on an acquisition strategy that may result in complaints to or enquiries by the ACCC it may be prudent to take the initiative to meet with the ACCC and brief them about your business, the competitive dynamics or the market and the aim of the acquisitions.
A responsible organisation that operates in a regulated environment will adopt a respectful, compliant position in dealings with a regulator. At the same time, it is important to know your corporation’s legal rights and the principles which might apply to the regulator, including integrity, professionalism, confidentiality, timeliness, proportionality and fairness. With the right advice you will be well placed to respond to regulatory action in a way that best protects your legal interests.
See our complete Guide to dealing with Regulators in Australia, which covers key information including dealing with regulators through voluntary inquiries and compulsory scenarios such as, information gathering, examinations and responding to warrants.
This article is general in nature. Your dealings with a regulator are of fundamental importance to your business and you should seek expert legal advice.
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