U.S. Securities and Exchange Commission Chairman Christopher Cox and
Australian Prime Minister Kevin Rudd have announced that the SEC, the
Australian Securities and Investment Commission (ASIC) and the
Australian Treasury Department have begun formal discussions to
consider a mutual recognition arrangement for the two nations’
securities markets. The discussions are intended to enhance
cross-border law enforcement cooperation, facilitate regulatory
coordination, and increase investor access to well-regulated capital
markets.

The SEC and ASIC have agreed to undertake a formal assessment of
each other’s regulatory systems to determine the extent to which each
jurisdiction produces a comparable level of investor protection. The
results of the comparability assessment would be published for public
comment before being made final. Once the comparability assessment is
completed, this would provide the basis for further discussions between
the SEC and ASIC regarding a formal mutual recognition arrangement,
which would include specific discussion of the extent to which, and
under what circumstances, U.S. and Australian securities exchanges and
market participants could operate in each other’s markets and would
articulate the additional cooperation arrangements that would be
necessary and appropriate to ensure the integrity of financial markets
and the protection of investors.