The Financial Markets Authority has announced it has imposed two standard conditions for transitional licensing, after considering all submissions it received during the consultation period and regulatory and non-regulatory impacts.
The regulator consulted on the two standard conditions from June to July this year (see: FMA Consults…).
The conditions relate to record-keeping and internal complaints resolution process requirements.
They will require Financial Advice Providers (FAPs) to maintain adequate records in relation to their financial advice service and have a fair, timely and transparent internal process for resolving client complaints.
“Imposing the conditions will improve conduct and consumer outcomes…”
“Imposing the conditions will improve conduct and consumer outcomes by ensuring there are adequate records of advice and services provided by FAPs and that customer complaints are dealt with in a fair, transparent and timely manner,” the FMA stated in its Regulatory Impact Statement.
“Without the conditions, there would be no regulatory requirement for FAPs to keep records (other than in relation to disclosure) or have an internal complaints resolution process. While FAPs may keep records and have an internal complaints resolution process, there would be less certainty that the benefits noted above would apply,” it explained.
These conditions will come into effect from 29 June 2020 as part of the new financial advice regime.
Click here to view the full description and explanatory notes of the FMA’s standard conditions for transitional financial advice provider licences.