The Financial Services Legislation Amendment Act aims to improve access to high-quality financial advice for all New Zealanders, and has just passed into law.
The Act will repeal the Financial Advisers Act 2008 and create a new regime for regulating financial advice. This will remove the current classifications of advisers and advice firms (Authorised, Registered or QFE) and the distinction between ‘class advice’ and ‘personalised advice’, and between category 1 and 2 products.
Under the new regime, anyone giving financial advice to retail clients will need to be engaged by a Financial Advice Provider that is licensed by the Financial Markets Authority (or become licensed as a Financial Advice Provider themselves to give advice directly). The new regime will also introduce new conduct and competence requirements for anyone giving financial advice to a retail client.
The start date for the new financial advice regime is expected to be set in the coming months after the new Code of Conduct has been approved. Following this, there will be time built in for industry to prepare to meet the new regime’s requirements.
If you’re a business or individual offering financial advice or investment planning services, these changes will affect you. Please keep an eye on our news updates for more information in the coming weeks.
Want to know more?
The Ministry Business Innovation and Employment (MBIE) is just one of the government bodies tasked with implementing the new regime and you can view information about the changes on the MBIE website. Others include the Financial Markets Authority (FMA) and the Financial Advice Code Working Group.
If you provide a financial adviser service today, find out more about the new regime, how it will work, and what you can do to make sure you’re ready, by checking out the resources available on the FMA website.