Minister changes QFE rules

The proposed changes to the Financial Advisers and the Financial Service Providers acts include requiring a QFE to name the individual contractors whose advice it will take responsibility for; allowing named contractors as well as QFE employees to provide financial advice services on the QFE's category one products without being individually licensed; and allowing employees and named contractors to provide advice services for products which the QFE is a promoter of under the Securities Act, not just as issuer.

The proposed changes will mean QFEs will not automatically be responsible for advice from all its contractors and is a move away from permitting only QFE employees to provide advice on category one products without an individual license.

"The amendments intend to simplify the implementation of the Acts and reduce costs, while still encouraging public confidence in the industry and promoting sound and efficient delivery of financial advice," Power says.

He also plans to change term life insurance, bonus bonds and call building society shares from category one to category two products in an effort to ensure simpler financial products are still easily accessible to the public.