Treasury has released a fact sheet outlining the further reforms proposed to financial services laws following the Quality of Advice Review.

New class of financial adviser
A new class of financial adviser will be introduced to deliver simple advice.

The new class of adviser will be required to complete an AQF level 5 diploma.

They will be restricted to advising only on products issued by prudentially regulated entities and will be prevented from providing advice on more complex and high-risk areas such as establishing a self-managed superannuation fund.

The new class of adviser will be limited to advising existing customers of a licensee, and new customers where the new customer initiates the advice request.

Best interests duty
The best interests duty will be changed into an outcomes-focused duty and the existing process-based safe harbour steps removed.

The existing concessional treatment for personal advice on basic banking and general insurance products will be maintained.

Statements of advice will be replaced by a principles-based record that is in plain English and
addresses the client’s needs.

The rules on what advice topics can be paid for via superannuation and the member circumstances that can be considered will be clarified.

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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.