Timing announced for new financial advice regime
Yesterday, the Government announced that the impending financial advice regime is to come into force in June 2020, with the exact date to be confirmed by Order in Council.
The new regime, divided between the Financial Services Legislation Amendment Act 2019, the Code of Professional Conduct for Financial Services, and regulations still to come, will represent a significant overhaul in the regulation of financial advice in New Zealand.
Additionally, the Government also announced the range of fees that the Financial Markets Authority will charge for licence applications and that it would change the Financial Service Providers Register registration requirements to prevent offshore entities from registering to create the illusion that they are actively regulated.
The Government press release can be found here, while the Ministry of Business, Innovation and Employment’s information page on the new regime can be found here. Our discussion of the passing of the Act and the approval of the Code can be found here and here respectively.
Who does this affect?
All businesses involved in the provision of financial advice, financial services or financial products must examine their operations and assess how they will be affected by the incoming regime. They should make use of this new clarity in timing to get these processes in order well ahead of the changes coming into effect.
This announced timing of the start of the regime will also affect the timing of other parts of the process. The two year limited transition period will now be due to end in June 2022. Similarly, as there must be at least six months between the opening of applications for transitional licences and the start of the regime, applications should open in Q4 2019.
If you have any questions in relation to the incoming regime, or are considering how these changes may affect your business, please contact one of our experts.