Investments under $15,000 will no longer need a statement of advice (SOA) under long-awaited changes to the regulatory system that the Government intends to pass during the winter sitting of Parliament.
Parliamentary Secretary to the Treasurer Chris Pearce has introduced the Simpler Regulatory System Bill into Parliament in an attempt to drop the cost of financial advice.
A full SOA will only be required if the advice given is in relation to an investment amount above $15,000.
A record of advice would still need to be given to clients under this amount.
“[This] will encourage and further enable mum and dad investors to effectively participate in the marketplace,” Pearce said.
Also removed is a requirement to provide an SOA when personal advice is provided that does not involve the recommendation of a product and no remuneration is received for the advice.
A Financial Services Guide will not need to be provided at a public or private forum where 10 or more retail clients attend.
A mechanism will also be introduced to allow a financial services licensee to be satisfied that an investor is equipped to be determined a wholesale investor.
An unpopular plan to split the definition of product sales and advice has been dropped.
However, the Government wants to consult further with industry to get a workable solution to the conflicts of interest debate.
The bill will implement the bulk of regulatory reform plans released in November last year, covering financial services, financial reporting, takeovers, auditor independence, corporate governance and fundraising.
