Acting on instruction from finance minister Mathias Cormann, Sir Peter Cosgrove issued a legislative instrument last week, which will see the deal struck between the federal government and opposition following the successful FOFA disallowance motion become legislation, taking effect today.
The Corporations Amendment (Revising Future of Financial Advice) Regulation 2014 will see a number of amendments remade including the provisions on grandfathered revenue, stamping fees, training and education benefits and the ASX24-traded products.
In response to the registration of the legislative instrument in parliament yesterday, the Financial Planning Association issued a statement welcoming the move, singling out the grandfathering provisions in particular.
“When FOFA was being developed we fought hard to remove the restrictions on trade and unfair market competition created by the original FOFA reforms,” said FPA chief executive Mark Rantall.
“Today’s finalisation of the grandfathering provision will enable all advisers to retain grandfathered benefits, regardless of the licensee they move to, fostering greater fairness across the financial planning profession.”
A separate legislative instrument issued yesterday will repeal the changes to Statements of Advice (SOAs) agreed to as part of the now-defunct deal with the Palmer United Party on FOFA.
Under the deal struck in July, the government agreed to enact a regulation requiring SOAs to explicitly list adviser requirements including the best interest duty, disclosure of fees, a 14-day cooling-off period for financial products and the ability for clients to change adviser instructions.
Mr Rantall described the repeal of the slated SOA changes as a “good outcome” for the financial planning profession.
“We always believed that the changes put forward were already a requirement, and therefore a duplication,” he said. ”To this end, the appropriate consumer protections remain in place.”
A legislative instrument has also been issued which will see the grandfathering amendments agreed to by the major parties become law.
