The federal Senate has unanimously passed a bill mandating higher education standards for financial advisers.
Minister for Revenue and Financial Services Kelly O’Dwyer introduced the Corporations Amendment (Professional Standards of Financial Advisers) Bill 2016 into Parliament in November 2016.
The education bill includes compulsory education requirements for both new and existing financial advisers, supervision requirements for new advisers as well as a code of ethics for the industry.
The bill will also mandate an exam that will represent a common benchmark across the industry and an ongoing professional development component.
The new professional standards regime will start on 1 January 2019, whereby new advisers entering the industry will be required to hold a relevant degree.
Existing financial advisers will have access to transitional arrangements allowing them two years, until 1 January 2021, to pass the exam, and five years, until 1 January 2024, to meet the education requirements.
Industry bodies including the Financial Services Council, Financial Planning Association and the Australian Bankers' Association welcomed the passage of the bill.
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