Financial Regulation

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<img src="https://counter.theconversation.edu.au/content/65328/count.gif" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
Banks may still be evading increased regulation by shifting activities to shadow banking. This system is well established as part of the financial sector, but it provides products that separate an investor from an investment, making it more difficult to evaluate risk and value.
This lack of transparency increases the risk in our financial system overall, making it vulnerable to the types of shocks that caused the 2008 global financial crisis. A current example is the so-called “bespoke tranche opportunity” offered by shadow banks. This is similar to the notorious collateralised debt obligations, packages made up of thousands of mortgage loans some of which were sub-prime, blamed for the global financial crisis.
Shadow banking is comprised of hedge funds, private equity funds, mutual funds, pension funds and endowments, insurance and finance companies providing financial intermediation without explicit public liquidity and credit guarantees from governments. Shadow banking is usually located in lightly regulated offshore financial centres.
In the period leading up to the global financial crisis, a large portion of financing of securitised assets that allowed regulated banks to exceed limitations on their risk-taking was handled by the shadow banking sector.
To this day, shadow banking continues to make a significant contribution to financing the real economy. For example, according to the Financial Stability Board, in 2013 shadow banking assets represented 25% of total financial system assets. While the average annual growth in assets of banks (2011-2014) was 5.6%, shadow banking growth stood at 6.3%.
A comparison of country-based share of shadow banking assets between 2010 and 2014 reveals the largest rise for China from 2% to 8%, while the USA maintains its dominance of the shadow banking markets with around 40%.
The failure of private sector guarantees to help shadow banking endure the global financial crisis can be traced to underestimated tail risks by credit rating agencies, risk managers and investors. Credit rating agencies lack of transparency, when it comes to explaining their methods (often disguised as “commercial-in-confidence”), continue to make it difficult for a third party to check assessments.
An excess supply of inexpensive credit also contributed to risk before the global financial crisis of 2008. This was because investors overestimated the value of private credit and liquidity enhancements.
One of the key challenges for regulators now is to devise rules and standards requiring shadow markets to hold enough liquidity to be sufficiently sensitive to risk. However, where investors and financial intermediaries fail to identify new risks, it is less likely that the regulators – who have fewer resources – will succeed.
Raising capital requirements can limit the capacity of financial intermediaries to expand risky activities, although monitoring overall bank leverage may be better. This is because credit ratings cannot be relied upon in the presence of neglected risks. Similarly, monitoring rising exposure of regulated banks to shadow banking or untested financial innovations can also become part of the regulator’s arsenal.
But there remains a major problem that is unlikely to be resolved by any regulation. Regulation is meant to strike a fine balance between close supervision and allowing space for financial innovation because loss of diversity can create stronger channels of transmission and could expose financial systems to greater systemic risk.
Too little regulation encourages excessive risk taking, while too tight a regulation is bound to strangle the financial sector that provides the lifeline for the economy. Striking such a fine balance is next to impossible in a dynamic, global financial sector.
The Basel Accords, set up to strengthen regulation after the financial crisis, will continue to play a key role in helping manage systemic risk like this. For example regulations can collect data that would be useful in macroprudential regulation, taking action to reduce various risks and remaining alert to unfolding trends on the ground.
Regulators need to heed the trends in shadow banking as part of this, to ensure transparency. However the nature of this sector, the long chains and multiple counterparties with unclear financial obligations, will continue to make the job of the regulator very difficult.
Necmi K Avkiran is associate professor in Banking and Finance, The University of Queensland and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/necmi-k-avkiran-298084" target="_blank">here</a>.
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Shadow banking increases the risk of another global financial crisis

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Investors should expect regulations that allow self-managed superannuation funds to borrow to buy property to come under government scruitiny in the coming months, an expert in the area has said.
In February, Assistant Treasurer Arthur Sinodinos ruled out a specific review into limited recourse borrowing arrangements which SMSFs use when taking out loans to buy property.
Macquarie Bank executive director David Shirlow told Property Observer it was unlikely that the government would change its position, despite Senator Sinodinos standing aside and Finance Minister Mathias Cormann taking over as Acting Assistant Treasurer.
“Whilst the prospect of a separate and specific review of the matter is off the policy agenda for the time being, there are still some live policy issues in borrowing through super,” said Shirlow, who specialises in SMSFs and sits on the board of the SMSF Professionals’ Association of Australia (SPAA).
He said some stakeholders had argued that it was inappropriate for SMSFs to borrow for property investment at all, and that further constraints on advice provided regarding limited recourse borrowing arrangements and product offerings could be considered.
The arrangements are likely to be examined as part of the Financial System Inquiry, which is due to publish an interim report in mid-2014 and a final report by November.
Numerous submissions to the Inquiry have called for government to review SMSF borrowing and put in place additional consumer protection measures and education for trustees.
Big four accounting firm KPMG noted in its submission that super funds were tax-exempt in the pension phase, which provided incentives for SMSFs to invest in long-term assets such as residential property, and even more so if the property was negatively geared.
The Institute of Chartered Accountants in Australia strongly encouraged a review of existing arrangements to ascertain whether borrowing was appropriate and, if it was, to ensure the right legislative and regulatory frameworks were in place.
Mid-tier accounting firm Chan &amp; Naylor called for urgent action to create a dedicated national SMSF educational framework, lead by the Australian Securities and Investments Commission (ASIC), to teach the public about the merits and pitfalls of SMSF investments.
The Reserve Bank of Australia noted that SMSFs borrowing could expose members to greater financial risks (including excessive concentration in a single asset) than they understood they were taking.
CPA Australia raised concerns about the appropriateness of advice received by SMSF trustees and members, and potential misinformation being provided by unlicensed advisers such as real estate agents, mortgage brokers and property developers.
Shirlow said ASIC considered itself to have jurisdiction, under the Corporations Act, over some aspects of property sales people giving advice on limited recourse borrowing arrangements.
“Stakeholders such as SPAA would argue that there should be some more definite consumer protection rules in place to make sure that property spruiking is not going to lead to disaster,” he added.
The Association of Superannuation Funds of Australia has previously advocated for advice to SMSFs on asset classes such as investment property and limited recourse loans to be provided only through licensed financial planners.
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Investors should expect SMSF borrowing to come under greater government scrutiny

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The Australian Securities and Investments Commission (ASIC) has noted the decision by Premier Investments Limited (Premier) to write down the value of its casual wear brand name assets by $30 million in its financial report for the year ended 28 July 2018.
ASIC had raised concerns on the value of these assets in Premier’s financial report for the year ended 29 July 2017.
They had questioned the "reasonableness and supportability of royalty rate assumptions and sales growth forecasts used in testing the assets for impairment".
ASIC stated: "Premier has referred to the increasingly competitive retail landscape and structural changes impacting the apparel industry in Australia and New Zealand."
The impairment of non-financial assets remains a "focus area of ASIC’s financial reporting surveillance program".
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j.ballantyne1990-6AQqhLzZaK

Premier Investments write down brand name assets

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GUEST OBSERVATION
As public hearings into the <a href="https://futureofadvice.treasury.gov.au/Content/Content.aspx?doc=home.htm" target="_blank">Future of Financial Advice’s</a> Senate inquiry begin today, it’s probably not overstating the case to say the financial planning industry is at a crossroads.
With the F0FA regime currently in place, the opportunity presents itself for a new generation of financial planners committed to serving the best interests of consumers, without the conflicting incentive of commissions.
Unfortunately the old generation of financial planners appears intent on rejecting this opportunity. It’s probably not surprising given that, according to 2011 MFAA figures, only 11% of planners are aged under 30, and around 80% of planners are either owned or affiliated with the major banks. Hence the sales culture of the older planners and their vertically integrated organisations, wishing to cross-sell as much product as possible, is well entrenched.
As a consequence we are seeing an ongoing campaign (<a href="https://futureofadvice.treasury.gov.au/Content/Content.aspx?doc=home.htm" target="_blank">notably by some of the big banks</a>) to water down the FOFA legislation, which has only been in place since July 2013.
The proposed reforms to FOFA include removing the “opt-in” requirement where clients of financial advisers must indicate annually that they wish to continue the service, removing the need for an annual fee disclosure for clients engaging before 1 July, 2013, and a watering down of the “best interest” duty and provisions directed at removing conflicted remuneration; that is the payment of commissions, on general advice.
The process was postponed in March when assistant treasurer Arthur Sinodinos stepped aside and finance minister Mathias Cormann referred the legislative package to the Senate Economics Legislation Committee, but <a href="https://www.smh.com.au/business/fofa-reforms-sell-retirees-short-20140512-385tm" target="_blank">media reports</a> suggest the government may soon unveil its plans.
The banking industry claims much has changed since the impact of the global financial crisis revealed the extent of shameful practices in the advice industry.
The financial advice collapses in Australia between 2006 and 2010 - involving <a href="https://www.themonthly.com.au/issue/2011/february/1299634145/paul-barry/eye-storm" target="_blank">Storm Financial</a>, <a href="https://www.asic.gov.au/asic/asic.nsf/byheadline/Opes+Prime?openDocument" target="_blank">Opes Prime</a>, <a href="https://www.theglobalmail.org/feature/inside-the-offshore-fraud-the-villains-and-victims-of-australias-biggest-pension-scam/789/" target="_blank">Trio Capital</a> and <a href="https://www.propertyobserver.com.au/https://www.smh.com.au/news/business/westpoint-could-have-been-wound-up-years-ago/2006/07/05/1151779013363?from=rss" target="_blank">Westpoint Property Group</a> - resulted in more than A$6 billion in losses and involved more than 120,000 people.
All involved conflicted remuneration structures and high commissions as fundamental issues.
But more recent cases involving Commonwealth Financial Planning have been brought to light <a href="https://www.smh.com.au/business/banking-and-finance/cba-told-to-reopen-compensation-for-advice-victims-20140516-38fd7" target="_blank">by reporting from Fairfax’s Adele Ferguson</a> and <a href="https://www.abc.net.au/4corners/stories/2014/05/05/3995954.htm" target="_blank">the ABC’s Four Corners</a>.
Advisers in these cases exploited their clients by offering advice that prioritised their own best interest over that of their clients.
It is difficult to understand the extent of this exploitation without reference to specifics. In one of the key cases surrounding the Storm Financial collapse, ASIC pursued Macquarie Bank and Bank of Queensland on behalf of two investors aged in their sixties, <a href="https://storm.asic.gov.au/storm/storm.nsf/byheadline/Doyle%20proceedings?opendocument" target="_blank">Barry and Deanna Doyle</a>.
Despite the fact that the Doyles had indicated to their advisers that they had a low risk appetite, they were “double-geared” into the stock market by borrowing against their home and using the cash to raise yet more money to invest.
With only part-time income of less than $20,000, some Centrelink payments, and assets which consisted of a house worth $450,000 and $640,000 in superannuation savings, the Doyles ended up owning a share portfolio costing $2.26 million, on which annual interest payments eventually rose to $191,800.
Following the fall in asset prices the Doyles’ highly leveraged share portfolio was sold, consuming all of their superannuation savings. They were left with a debt of $456,000 on their previously unencumbered home, with insufficient income to make the repayments. In return for this disastrous investment advice, which saw them increase their borrowings or exposure to the stock market no fewer than 11 times in 25 months, the Doyles paid Storm $152,000 in fees.
Not surprising then that at the heart of the FOFA legislation are two key “gatekeeper” requirements to address conflicted remuneration. First, planners must prioritise their clients interests over their own, and second, the advice must be appropriate to the client’s own situation.
It is important to note here that there are advisers who do routinely act in their client’s best interest. This is reflected in the Financial Planning Association of Australia’s <a href="https://fpa.asn.au/financial-system-inquiry-submission-recommends-consideration-fairness-co-regulation/" target="_blank">submission to the Financial System Inquiry</a>, which argues that rather than water down the FOFA legislation, there is a good case to extend this “gatekeeper standard” to other areas of financial services to protect the interests of investors more broadly.
As we have been reminded only too often over recent weeks, we have an ageing population, increasing demands on the welfare system, and a very real need to maximise our retirement savings to ensure greater self-reliance in retirement. Given the generally poor level of financial literacy in this country, this is most unlikely to happen unless individuals can access low cost and scalable advice to assist in their retirement planning. The opportunities for the financial advice industry, and the investment community more generally, is therefore enormous.
The willingness with which individuals seek such advice, however, will depend on their confidence in the financial planning industry. Research from Rice Warner indicates that as a result of collapses such as those listed above, consumers hold a low view of financial advisers, with only 25% regarding them as ethical and honest. This mistrust results in Australians not seeking financial advice when it could be beneficial for them to do so.
The FOFA legislation presents a great opportunity for the financial advice industry collectively to adopt a more ethical client focused approach, re-instilling confidence in the industry. Without that confidence, individuals will not seek the advice they need, retirement savings will not be maximised, and there is likely to be an even greater need to rely on the age pension.
Deborah Ralston is Professor of Finance and Director at <a href="https://www.australiancentre.com.au/" target="_blank" style="line-height: 1.3em;">Australian Centre for Financial Studies</a><img src="https://counter.theconversation.edu.au/content/26822/count.gif" alt="The Conversation" width="1" height="1" style="font-size: 12px; line-height: 1.3em;">
Deborah Ralston is affiliated with Mortgage Choice Financial Planning and provided expert advice to ASIC on the Storm Financial case.
This article was originally published on <a href="https://theconversation.com" target="_blank">The Conversation</a>.
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Financial planning industry at the crossroads: Why efforts to water down FOFA must be resisted

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Changes to the Future of Financial Advice laws could cost consumers more than $530 million a year in increased fees and charges, according to a report published today.
The report from Rice Warner says the reintroduction of commissions and other conflicted payments could hit consumers with a staggering $7.5 billion of extra costs over 14 years.
It also debunks the claims by banks and financial planners that diluting consumer protections will reduce the cost of advice.
Industry Super Australia chief executive David Whiteley said in a statement the multi-billion dollar impact explains the relentless lobbying by the banks and financial planners to reduce consumer protections.
“The reality is that cutting consumer protections just increases commissions and fees paid to financial planners to sell bank products.”
“It would seem that the banks’ objective is to be able to sell compulsory super and other products through financial planners and other staff, rather than provide Australians with the impartial financial advice that they want, need and deserve,” he said.
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
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Aussies hit with $7.5 billion in extra costs due to FOFA changes

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People who commit white collar crime in Australia are getting off lightly compared with those found guilty of similar offenses in other countries, a report has found.
Thousands of Australians have lost millions of dollars or been put at risk by the actions of financial planners and credit brokers who have committed fraud, provided inappropriate advice and operated without an appropriate license.
A report by the Australia Securities and Investments Commission has found the penalties that can be imposed for such offenses in Australia are limited in some cases compared with those available to regulators in other jurisdictions.
For example, people who provide financial services without a license in Australia can only be fined up to $34,000. In contrast, the report found that people guilty of the same offenses in the US face maximum fines of $5.6 million. In the UK, the maximum fine is unlimited.
The maximum civil penalty in Australia for giving inappropriate advice is $200,000, while in the UK the maximum is unlimited, and in Hong Kong it is the greater of $1.4 million or three times the benefit gained by the wrongdoer. 
Individuals who broke corporate rules in the US could be sentenced to prison terms of up to 20 years. In Australia, and most other jurisdictions studied, the maximum prison term was 10 years for criminal penalties such as fraud and insider trading. The maximum prison term for providing financial services without a license in Australia is just two years.
The report compared maximum penalties in Australia to penalties imposed for similar offenses in Hong Kong, the United Kingdom, the United States and Canadian province, Ontario.
It found that regulators elsewhere could, in addition to imposing fines and prison terms, remove financial benefits that wrongdoers had obtained through illegal profits or avoided losses. ASIC does not have that power, although it can ask other agencies to bring an action to confiscate the proceeds of crime.
The relatively low fixed fines that ASIC can impose and the fact that it cannot remove the proceeds of crime itself meant that wrongdoers may still profit from their conduct and not be deterred by the penalties, the report warned.
“The maximum fine that may be imposed may be substantially lower than the financial benefit obtained as a result of the wrongdoing,” it said.
The report also found inconsistencies between penalties that could apply to similar offenses under different pieces of legislation within Australia. For instance, offering a financial service without a license attracted a criminal penalty under the Corporations Act with individuals fined up to $34,000, while someone giving unlicensed credit advice could be subject to the same criminal penalty, or a civil penalty of up to $340,000.
Civil penalties in the Corporations Act have been eroded by inflation as they have not increased since they were set in 1992 for individuals and 2004 for corporations. In 2007, it was suggested that the penalties should be lifted following a Treasury review, although no increases were made.
The report is the first of its kind in over a decade and ASIC has recommended further work be done.
Its findings will be fed into ASIC’s submission to the Financial System Inquiry, which closes for comment on Friday, March 28.
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Australia's white collar crime penalties pale in comparison to other jurisdictions

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We live in a crazy world where we are encouraged to invest and fund our own retirement but are not provided with adequate information or legislative protection to assist us to do so.
People who are looking to enter the property market are forced to rely on patchy information, as disclosure of sale results is not mandatory and access to past sales is hidden from view. In addition consumer protection laws for property investors are almost non-existent. As the wheels of the property market begin to turn this is the reality property investors face.
Currently there is no obligation for real estate agents or vendors to disclose sale results to the public. For years the industry has hidden behind privacy concerns but consider this, even a property sold via a public auction can be undisclosed. If you are watching the auction you would know the result but because of privacy concerns the vendor can elect to hide the result. Have you ever heard of anything so ludicrous!  
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Lack of regulation enables practitioners to sell investors a product or concept, under the guise of providing advice without taking into account an individual’s personal or financial circumstances.
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On any weekend as many as 10% - 20% of all auction results are not disclosed. Imagine if the board of BHP was to keep that much information hidden from the market place. There would be up roar and rightly so!
Further the historical growth of an individual asset is a key piece of information anyone buying property needs to know to make an informed decision. However what the property last sold for is usually very hard for the average punter to find. Again imagine if you were looking to purchase some BHP shares but had no access to historical values. It would be very difficult to work out fair market value.
But it gets worse for property investors. Legislation administered by the Australian Securities and Investment Commission (ASIC) provides protection for investors in shares, managed funds and super. Financial planners are required to consider each client’s personal and financial situation, investment knowledge and risk tolerance before giving recommendations on strategies or products. They must also provide a rationale for the recommendations, and disclose fees and commissions they will receive if the client acts on their advice.
Investors in direct property, however, receive no such protection from the nation’s investment watchdog. This is a glaring anomaly given that, according to the Tax Office, around 1.5 million Australians declare rental income for investment properties.
The ASIC Act’s rationale for excluding direct property from the definition of what constitutes a ‘financial product’ is that — unlike shares, super and managed funds, where investors entrust day-to-day control to a third party to generate a return — direct property investors retain direct control of decisions and returns.
The fact that direct property investors retain control of their assets doesn’t mean they are any more likely to make sound investment decisions. On the contrary, the absence of a third party increases the need for inclusion in ASIC’s safety net.
Lack of regulation enables practitioners to sell investors a product or concept, under the guise of providing advice without taking into account an individual’s personal or financial circumstances.
The regulator’s attitude to direct property as an asset class is clearly out of step with the way it’s being utilised as an investment in the wider community. It’s time the legislation was amended to recognise direct property as a financial product and give property investors the same level of protection and access to information as those holding other asset classes.
The time is ripe for the nation’s corporate watchdog to step up to the plate. When investors turn their attention to property, they’ll be in a better position to make informed investment choices and less prone to the fallout from lousy investment advice.
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Full disclosure and property investor protection

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Regional banks have called on the Financial System Inquiry to address issues that they say have created competitive advantages for the big four banks in home lending and other financial services.
In a joint submission to the inquiry, Bendigo and Adelaide Bank, BOQ, ME Bank and Suncorp Bank said the fall-out from the global financial crisis had favoured the major players.
“The banking landscape is now characterised by a higher degree of market concentration, consolidation and increasing dominance of the large banks relative to other providers,” the banks noted in their submission, which was prepared with the help of Pegasus Economics.
“While smaller banks and others provide customers with real alternatives and choice when it comes to financial services, these smaller participants do so at a distinct competitive disadvantage.”
Over the past few years, the major banks had become more vertically integrate with mortgage brokers and financial advice networks, which the regional banks’ submission claimed provided advantages in distributing home loans and other financial products.
The regional banks recommended the inquiry consider commissioning the Australian Securities and Investments Commission to survey the market to assess whether the major banks’ multi-brand strategies were confusing consumers about ownership.
“If it is found that confusion does exist, then a strong disclosure obligation must be introduced to ensure customers are making informed decisions,” the banks said in their submission.
The regional banks also noted that significant funding and cost advantages were available to the big banks deemed “systemically important” and that new regulatory and prudential requirements cost more, in relative terms, for the regional banks to implement.
They also claimed that asset requirements under the Basel capital adequacy framework made it more profitable for the big banks than for the regional banks to issue home loans.
The four big Australian banks, which had undertaken advanced Basel accreditation, were required to hold on average 1.3 cents of capital against each $1 of mortgage credit, UBS Securities Australia estimated. Banks operating under the standardised accreditation – including the regional participants – must hold up to three times more capital for the same loan.
The difference in capital requirements meant that the implied return on equity for ANZ to supply a home loan (estimated to be around 50 basis points) was 34.92% while the same mortgage delivered Bank of Queensland a return on equity of just 14.17%.
Other submissions to the Financial System Inquiry did not agree that competition in the mortgage market was inadequate.
The Reserve Bank of Australia in its submission said a good deal of focus had already been placed on competition in the mortgage market since the financial crisis and that competition in the market for small business loans was more of a concern.
“The [Reserve] Bank considers that this market should be the focus of inquiries regarding competition in lending, rather than the mortgage market,” it said.
Commonwealth Bank of Australia and ANZ agreed in their separate submissions that the inquiry should focus on improving the depth and liquidity of debt markets, on ensuring regulatory standards were consistent and on improving consumers’ financial literacy.
ANZ said: “An open market should continue to be the primary mechanism for maintaining an efficient, competitive financial system. Improvements to retail bond markets and removal of interest withholding taxes would promote efficient competition.”
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Regional banks highlight competitive disadvantages in Financial System Inquiry submission

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The Australian Prudential Regulation Authority has issued tough draft guidelines on how it expects banks to monitor and manage home mortgage risks.
Upon <a href="https://www.apra.gov.au/adi/PrudentialFramework/Pages/adi-consultation-packages.aspx" target="_blank">the release</a>, APRA chairman John Laker noted "increasing evidence of lending with higher risk characteristics and it does not want this trend to continue".
the current concern sits  against the backdrop where residential mortgage exposures have exhibited low default and loss rates in the $1.3 trillion Australian mortgage market. But the continued low interest rate environment has authorities concerned for when rates take off again.
Aimed at complacency among residential mortgage lenders, the draft guidelines still fall short of the stricker macro­-prudential rules adopted in recent times by other regulators especially in New Zealand and Canada.
But the draft guidelines suggest banks consider "geographic concentrations" of risky loans.
There might also be new limits on loans relative to incomes along with stronger stress-testing borrowers.
There is also the possibility of reducing financial incentives and commissions to mortgage brokers.
APRA chairman John Laker said credit standards were needed given “very active competition” between lenders and rising property markets.
The Australian Financial Review columnist Tony Boyd recently calculated that the net present value of annual commissions paid to mortgage brokers is about $600 million, based on brokers handling about half of the $28 billion in mortgages settled each month.
APRA suggests commissions paid upfront tend to encourage less rigorous attention to loan application quality. 
APRA has told the banks to review appropriate monitoring and controls “to guard against incentives to pursue loans with inadequate or false verification, marginal serviceability, excessive leverage or unsuitable terms for a borrower”.
In Australia, it is standard market practice to pay brokers either an upfront commission or a trailing commission, or both. 
"Experience has shown that commissions paid upfront tend to encourage less rigorous attention to loan application quality," the report said.
"Trailing commissions are more likely to provide incentives for brokers to retain and monitor customers. 
"A prudent approach to the use of third parties for residential mortgage lending would include appropriate compensation measures for brokers.
"Such measures include the ADI being able to end or claw back commissions where there are high levels of delinquency or process failures on loans originated by third parties."
The acting chief executive of the Australian Bankers’ Association, Diane Tate, said the industry had expected the new guidance.
APRA said it expected banks to closely monitor the share of new loans with high loan-to-valuation ratios (LVRs). While Australia has no caps on LVRs, it said those above 90% clearly exposed banks to a higher risk of losses.
‘‘Historically, residential mortgage exposures have exhibited low default and loss rates,” it said in the draft.
“However, lengthy periods of economic growth combined with low interest rates and a sustained period of rising house prices can create a sense of complacency among residential mortgage lenders.’’
APRA is taking industry feedback on the draft policy until late July.
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