What rules might apply under a new financial advice regime? We suggest you take the following documents as a whole to help you plan for the requirements for a Financial Adviser Practice:
- The draft law – the Financial Services Legislation Amendment Bill, plus the associated consultation document, fact sheet and FAQ. Link.
- The QFE Adviser Business Statement Guide – the current guide to application for the current equivalent of a FAP. Link.
- The Guide to the FMA's view of conduct – a new document, outlining expected conduct obligations. Link.
- The FMAs licencing overview document – brand new, and a good overview of expectations, especially covering governance, conduct, and professional development, and financial capability for licensed organisations. Link.
- Plus, of course, the current Code of Professional Conduct for Authorised Financial Advisers.
The guide to conduct and financial capability indicate the latest development in thinking around effective supervision. Adviser businesses that wish to obtain a licence and continue to hold one would do well to get across these requirements now.
Considering them as a whole it appeared that we may be about to step across the threshold where licensing is sufficiently complicated that a new minimum business size is required (variable some-what with extensive outsourcing – but noting limitations the FMA expresses on that). That new minimum may see more adviser practice merger activity. Assuming it all comes to pass.
The breadth of the requirements may also herald a boost to the market for regulation-technology ('regtech') to help you manage it all. We have been busier than ever on the Quotemonster side of the business with advisers seeking to become more familiar with comparison processes and needs analysis.
If you like to have hard copies you can write notes on and have Post-it note tags sticking out of (like me), then you had better warn folks in the office before you send them all to print.