The Financial Sector Reform (Hayne Royal Commission Response—Better Advice) Act 2021 amended the ASIC Act and the Corporations Act to transfer the functions of the Financial Adviser Standards and Ethics Authority (FASEA) to the Minister for Superannuation, Financial Services and the Digital Economy, with ASIC responsible for administering the financial adviser exam from 1 January 2022. Background.
Financial adviser education standards
The Government has released a policy paper seeking feedback on the financial adviser education standards and whether they remain fit for purpose including by ensuring that they adequately recognise on-the-job experience of advisers. Unless the standards made by FASEA are amended or replaced, the existing standards continue to set the requirements for financial advisers.
The Government registered Corporations (Relevant Providers – Education and Training Standards) Determination 2021, effective from 1 January 2022.
Additional requirements provide that financial advisers who provide tax (financial) advice services must complete commercial law and tax law courses.
However, these requirements will not apply to:
• from 1 January 2022 – financial advisers who were registered as tax (financial) advisers immediately before 1 January 2022 will never be required to comply with this requirement; or
• from the date the person’s registration as a tax (financial) adviser comes into force – financial advisers who applied to be registered as tax (financial) advisers before 1 January 2022 (and whose application is subsequently approved by the TPB on or after 1 January 2022) will never be required to comply with this requirement;
• between 1 January 2022 and 31 December 2025 – existing providers who are also financial advisers and who are not captured by the other exemptions will be granted a temporary exemption from this requirement.
ASIC information for tax financial advisers under Better Advice Act
ASIC has released an information sheet (INFO 268) for providers who provide, or intend to provide, tax (financial) advice services.
Quality of Advice Review – Draft Terms of Reference
The Government has released for feedback and stakeholder views draft Terms of Reference for the ‘Advice Review’.
The Advice Review will consider whether measures that have been implemented by government, regulators and financial services entities have improved the quality of financial advice, whether further reforms or other changes are needed, and whether any measures or obligations are redundant or can be streamlined. The review will also consider how to ensure the regulatory settings support Australians getting access to affordable financial advice.
ASIC guidance on limited advice
ASIC has released an information sheet on limited advice and an example statement of advice (SOA) to assist financial advisers and advice licensees comply with their obligations when providing limited personal advice to retail clients.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
