Treasury has released a draft of Corporations and Consumer Legislation Amendment (Consumer Financial Protection) Bill 2012 for consultation.

The Bill will restrict the use of the terms ‘financial adviser’ and ‘financial planner’.

An exposure draft regulation has also been released for consultation.

The regulations will replace the licence exemption for accountants with a new form of limited licence from 1 July 2013 which will enable accountants to discuss a range of financial products with their clients. The range of products includes SMSFs, superannuation, securities, simple managed investment schemes, general insurance, life risk insurance and basic deposit products. Apart from SMSFs, holders of this licence will only be able to talk about these products at a class of product level, meaning they cannot recommend specific products to their clients. Holders of this licence will also be able to lodge an annual compliance certificate rather than an auditor’s report if they do not handle client money.

The consumer protection provisions of the Corporations Act, such as the best interests duty, will be extended to financial advice provided by accountants.

The draft regulations also streamline licence experience requirements for accountants who hold a practicing certificate issued by one of the professional accounting bodies (the Institute of Chartered Accountants in Australia, CPA Australia Ltd and the Institute of Public Accountants).