Doing nothing 'not an option'

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Advisers do not need to have a definite plan yet for how they will approach the new legislative regime – but they need to engage with the process, Financial Services Council (FSC) chief executive Richard Klipin says.

Wednesday, January 16th 2019, 6:00AM 1 Comment

The Financial Services Legislation Amendment Bill is set to pass into law in the first quarter of this year, starting a process that will lead first to transitional licensing for the sector later in 2019, then full licensing two years later.

All financial advisers will need to be working for a licensed financial advice provider once the regime takes effect – whether that is their own business or another organisation.

The FSC is running a series of summits across the country in March to help advisers understand what will be required.

Klipin said, across the adviser community, there were varying levels of engagement, focus and understanding of the changes that were happening.

There would be a range of decisions people needed to make over the course of the year, he said.

Advisers could not afford to ignore the process, and needed to be engaged in considering how they would approach the new regime. “Doing nothing isn’t going to be an option. Being an active and engaged participant is where we would encourage people to be.”

He said it didn’t mean people had to make a firm decision immediately, because some detail was still to be supplied. But advisers needed to understand what was needed to future-proof their businesses so they could service their clients, rather than waiting until the last minute to make a call.

Klipin said product providers had a role to play to help advisers transition.

“This has got to be a whole of industry response. Everyone has a lot of skin in the game, product providers, advisers, dealer groups, manufacturers and service providers – this is an industry response to future-proof the sector and ensure all New Zealanders get food advice to benefit them.”

Wondering what to do next?

The Financial Markets Authority suggests advisers should:

• Consider what the changes mean for your medium - and long-term business plan.
• Identify and engage the best resources to help you with your decision-making – including your professional adviser association, product providers and legal adviser.
• Begin formalising business processes and procedures, and continue your learning and development.

Tags: FSC FSLAB

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