Consultation Paper 189
On 28 September 2012, ASIC released proposed guidance on the conflicted remuneration ban under FOFA. Consultation Paper 189 Future of Financial Advice: Conflicted Remuneration ("CP 189") sets out proposals for guidance about complying with the conflicted remuneration provisions.
CP 189 is detailed, and sets out many examples.
Some of the most important areas covered in CP 189 are:
Comments are due on the consultation paper by 9 November 2012. At this stage, ASIC expects to release a regulatory guide in February 2013.
FOFA Progress - Don't give up
We have recently heard from some of our smaller licensee clients that they are feeling that FOFA is too difficult for them, and they are considering giving up their licences to become authorised representatives of larger licensees. It is important to understand that preparation for FOFA should not be overwhelming. There will certainly be commercial challenges, as traditional streams of revenue from new clients will be disappearing. There will also be requirements to provide disclosure statements and obtain opt-in consents from clients. However, in our view, any licensee who has been able to properly manage their compliance arrangements up until this date will almost certainly still be able to manage their compliance arrangements under FOFA.
If you are feeling overwhelmed or concerned, please don't hesitate to call one of our team for a discussion about what the real requirements are. You will probably find that the new compliance requirements are much less onerous than you think, and that you won't need to give up your autonomy in order to manage the impact of FOFA.
The secret is to start an orderly process now, to ensure that all of your requirements are met. There is ample time to prepare if you start now.
A number of our clients have told us they would like a table showing the dates of application for the changes. In response to these requests, we have prepared such a table, and it is available upon request to our existing clients. If you would like a copy, please contact any of us listed at the end of this newsletter.
Halsey Legal Services and Licensee Solutions have developed a practical hands-on FOFA pack, containing many important compulsory documents, a road map to FOFA, schedule and so on. This is available for purchase. Please contact any of us at Halseys or Licensee Solutions to discuss.