The Financial Markets Authority (FMA) is encouraging financial advisers to apply for their transitional licences by the end of the year, as the Government announces final details of the new financial advice regime.
The Government today released the disclosure requirements for financial advisers operating under the new regime and has set the commencement date for 15 March, 2021.
John Botica, FMA Director of Market Engagement, welcomed the developments, which mark the final steps towards the implementation of the Financial Services Legislation Amendment Act.
“The disclosure requirements are an important component of the new regime as they will ensure consumers have clarity and transparency around the financial advice they’re receiving,” he said.
“We encourage advisers who haven’t begun the transitional licensing journey to actively consider their options under the new regime. We recommend advisers who intend to obtain a transitional licence file their application as soon as they are ready, ideally before the end of the year as a contingency. That way, you won’t be under pressure just before the regime begins and will have time to prepare for your new obligations.”
As of Monday, the FMA had granted 850 transitional licenses, representing an estimated 6,500 financial advisers.
Mr Botica added that Authorised Financial Advisers (AFAs) will not be required to submit their annual ‘information returns’ this year, providing regulatory relief ahead of the new regime. All other obligations under the FA Act 2008 and current Code of Professional Conduct remain in force until the start date of the new regime.
The Government’s announcement today follows the FMA last week beginning consultation on proposed licence classes and standard conditions for full licensing of Financial Advice Providers. The consultation closes on 7 August.