News round-up

• Tweet

Developments on disclosure requirements for advisers; Relief for employers helping out with super savings; First disputes resolution scheme application received; AIA selects Hong Kong as listing venue

Monday, December 14th 2009, 5:12AM 3 Comments

Developments on disclosure requirements for advisers
A bill that simplifies the implementation of the Financial Advisers Act and reduces costs of implementation was introduced into Parliament last week.

The Financial Services Providers (Pre-Implementation Adjustments) Bill makes technical amendments to the Financial Advisers Act (FAA).

The proposed amendments include:

• QFEs will be able to name representatives (contractors and agents) whose advice they will take responsibility for, rather than automatically being responsible.
• QFE  employees and named representatives will be able to provide financial advice or conduct investment transactions in relation to products for which the QFE is the promoter under the Securities Act. Currently, the FAA allows this only if the QFE is the issuer of the product.  
• The ability to provide financial advice or conduct investment transactions in relation to a QFE's Category One products (without being an authorised financial adviser) will be extended to the QFE's named representatives. This is currently only permitted in respect of the QFE's employees.
• Term life insurance policies, call debt securities, call building society shares and bonus bonds are now prescribed as Category Two products.

The bill also contains technical amendments to the Financial Services Providers (Registration and Dispute Resolution) Act.

Changes are expected to be passed into law in the first half of next year.

Relief for employers helping out with super savings
Companies offering workplace savings assistance are not likely to be caught under the definition of a financial services provider, under proposed changes in the Financial Services Providers Bill.

There has been concern that current legislation does not distinguish between a real provider of financial services, such as a bank, and an employer who merely promotes a superannuation scheme for its employees.

"Left unchanged, such an employer would need to register as a financial services provider and join a disputes resolution scheme," Workplace Savings NZ executive director Bruce Kerr said.

Changes proposed in the bill will help exempt employers from the need to register and recognise that the financial service is actually provided by the trustee and manager of the scheme.

The protection that the legislation is designed to provide for scheme members should be achieved through trustees and managers being registered.

"Employers assisting their employees with their workplace savings arrangements will be relieved that unless they are truly in the business of providing financial services, or actually giving financial advice, there should be no need to register as a financial services provider," Kerr said.

First disputes resolution scheme application received
Financial Services Complaints Limited (FSCL) has become the first body to apply to set up a financial sector consumer disputes resolution scheme.

"Consumers need access to good dispute resolution," says Minister of Consumer Affairs, Heather Roy.

By the end of 2010 financial service providers - banks, finance companies, insurance companies, financial advisers, credit unions, mortgage brokers, money lenders etc - will have to be registered and must join a disputes resolution scheme.

They can join an industry-run dispute resolution scheme approved by the Minister of Consumer Affairs, or sign up to the government reserve scheme.

Roy expects to make a recommendation in the New Year to decide upon FSCL's application and is encouraging others to apply.

AIA selects Hong Kong as listing venue
AIA Group and American International Group (AIG) is planning to list on the Hong Kong Stock Exchange as part of pursuing its IPO of AIA.

"The announcement of Hong Kong as the venue for the proposed listing is important progress on our path to becoming a public company," said Mark Wilson, AIA chief executive and president.

"The timing of any offering will be dependent on market conditions and regulatory approval; we will only list when we are ready."

Comments from our readers

Commenting is closed