Speak to our experts
Contents
The Financial Markets Authority (FMA) has confirmed two standard conditions will apply to all transitional financial advice provider (FAP) licences – maintaining adequate written records and having a fair, timely and transparent internal client complaint resolution process.
Applications for transitional licences will open on 25 November 2019.
The Financial Services Legislation Amendment Act 2019 (FSLAA) creates a new licensing regime for financial advisers which will come into force on 29 June 2020. There will be two phases to the licensing process – the initial transitional licensing, and full licensing by 29 June 2022.
The FMA has confirmed two standard conditions will apply to transitional FAP licences. All FAPs would need to comply with these standard conditions.
Record keeping
Every FAP must create in a timely manner, and maintain, adequate written records in relation to its financial advice service. The records:
- must be kept in a form (which may be electronic) and manner that ensures the integrity of the information and enables it to be conveniently inspected and reviewed by the FMA
- may be in any language, but if not in English, the FAP must keep an accurate summary of the record in English, and if required by the FMA provide a full English translation by an FMA-approved translator
- must be available for inspection by the FMA at all reasonable times, and
- must be kept for at least seven years from the later of:
- the date the record is made
- the date the financial advice to which the record relates is given, and
- the date any later record is made that refers to or relies upon information in the record.
The records must demonstrate how the FAP, any persons engaged by it, and the regulated financial advice given to retail clients, have complied with the Financial Markets Conducts Act, the Financial Markets Conduct Regulations and the Code of Professional Conduct for Financial Advice Services. The records should include a record of all regulated financial advice given to retail clients by the FAP or on its behalf. Records may be kept by another person on the FAP’s behalf, provided the FAP ensures that person complies with this condition.
Internal complaints process
Every FAP must have an internal process for resolving client complaints in relation to its financial advice service that provides for:
- complaints to be dealt with in a fair, timely and transparent manner, and
- records to be kept of all complaints and the action taken to resolve them, including the dates on which each complaint was received and any action was taken in relation to the complaint.
Next steps
If you would like advice on what the new regime will mean for you, please get in touch with one of our contacts.
Quick Links
Financial Services Legislation Amendment Act – Introduced 8 April 2019
