Issue 588, 8 December 2015
Consultation on draft legislation proposes raising the professional standards of financial advisers
On 3 December the Treasury released exposure draft legislation for consultation on measures to raise education, training and ethical standards for financial advisers, known as the Corporations Amendment (Professional Standards of Financial Advisers) Bill 2015 and Exposure Draft Explanatory Memorandum—copies of which can be found here.
The draft legislation follows consultation on the Parliamentary Joint Committee proposals in relation to these matters and as announced in the Government’s Financial System Inquiry response.
Under the proposed legislation:
- new financial advisers will require a degree, undertake a professional year and pass an exam
- the government will recognise an independent industry-established standard setting body, operational from 1 July 2016, that will develop and set education standards, professional year requirements, continuing professional development requirements and develop a comprehensive code of ethics for financial advisers
- existing advisers will be provided a transition process and will be required to complete an appropriate degree equivalent (or have a recognised transition pathway determined by the independent standard setting body) and pass an exam
- all advisers, both new and existing, will be required to undertake continuing professional development and be party to a code of ethics
- the new education and training requirement will be effective from 1 July 2017, with the code of ethics requirements coming into force from 1 July 2019.
ASFA supports raising the educational and professional standards for financial advisers and will engage with members regarding a potential submission in response to the consultation.
Please forward any comments you would like ASFA to consider for this submission to David Graus by close of business Friday 19 December.
