By: Jim Bulling
Review of the Quality of Financial Advice
In December 2021, the Australian Treasury published the Draft Terms of Reference to the Review of the Quality of Financial Advice (Review). The Review takes up a number of recommendations of the Hayne Royal Commission and seeks to achieve the goal of providing retail investors access to high quality, affordable, and accessible financial advice. Amongst other areas, the Review will investigate whether regulatory compliance obligations can be streamlined and simplified to reduce cost and remove duplication. Additionally, the Review will consider whether the safe harbour provision for the duty of financial advice providers to act in the best interests of their clients pursuant to section 961B of the Corporations Act 2001 (Cth) is in line with Commissioner Hayne’s recommendation that “unless there is a clear justification for retaining that provision, it should be repealed.”
The Review will be led by an independent reviewer and supported by a secretariat based in Treasury. The consultation period for the Draft Terms of Reference is now closed. The Review will be informed by data collected by ASIC and Treasury and the reviewer is due to provide a report to government by 16 December 2022.
Financial Adviser Exam (ASIC)
On 1 January 2022, ASIC replaced the Financial Adviser Standards and Ethics Authority as the administrator of the financial adviser exam. Passing the exam is one of four requirements financial advisers must meet to comply with the professional standards, which were introduced in March 2017. Timeframes for passing the exam as well as eligibility criteria can be found in ASIC Information Sheet 260. Enrollments for the first sitting of the financial adviser exam for 2022 have closed and the first exam commences 17 February 2022. The booking period for the next sitting is yet to be determined.