MBIE says the start of the new financial advice regime will be 15 March 2021.
This is the revised date following the delay from the original date of 29 June 2020. The impact of Covid-19 saw the date postponed.
In a statement, MBIE says the Government has set new disclosure requirements to ensure that consumers seeking financial advice can make more informed decisions.
MBIE says the new disclosure requirements will require businesses and individuals who give financial advice to disclose important information about their services to their clients.
…changes have been made to make the regulations more workable for the range of circumstances…
“The disclosure requirements are set in regulations under the Financial Services Legislation Amendment Act, which introduces a new regulatory regime for financial advice,” says Sharon Corbett, Manager Financial Markets at MBIE.
“They are intended to improve transparency and help consumers with important decisions such as choosing where to get financial advice.
“Information [that] those giving financial advice will need to disclose includes details about fees, the range of products they advise on, whether they have any conflicts of interest or earn commissions, and how to access dispute resolution services.
“This information needs to be provided at different stages of the advice process, including on the company’s website, when an adviser meets with a client, and during any complaints process. This will ensure that consumers receive only the information they need, when they need it.”
Corbett says the regulations incorporate feedback on an exposure draft released in October 2019.
“In response to that feedback, changes have been made to make the regulations more workable for the range of circumstances in which financial advice is given.
“For example, the previously proposed requirement to keep a record of each disclosure has been removed, and disclosure of matters like conflicts, commissions, limitations and regulatory actions has been limited to things that would likely materially influence a client’s decision.
“The disclosure regulations are a key part of the new regime and it’s important that advisers have time to understand the new requirements and to prepare to implement them before 15 March 2021.”
With just under nine months until the new regime begins, we know there is lots to work through…
Katrina Shanks, CEO of Financial Advice NZ, says: “We are pleased to finally have certainty on both the date of commencement of the new regime, and the disclosure requirements of the new regime.
“We appreciate these disclosure requirements are an important aspect of the new financial regime and how you as financial advisers need to operate.
“With just under nine months until the new regime begins, we know there is lots to work through, to understand and to implement.
“We note there are no transitional provisions ‘given there will now be more than 8 months until new regime commences’. Financial Advice will work hard to support our members’ understanding of these requirements.”
Financial Advice NZ is holding a webinar with a representative from MBIE on Friday, 3 July at 11am. Register here.