Financial Planning Association (FPA) members will be eligible for an exemption on providing opt-in notices every two years after the Australian Securities and Investment Commission (ASIC) approved a new Ongoing Fees Code developed by the Association.
In the first ruling of its type, ASIC approved the FPA’s Professional Ongoing Fees Code as an approved code which will achieve the same policy outcomes as the opt-in requirement under the Future of Financial Advice (FoFA) reforms.
ASIC stated that any Certified Financial Planner or Associate Financial Planner member of the FPA who subscribed to the Code would be exempt from having to comply with the opt-in requirement if they met certain requirements when entering into ongoing fee arrangements, delivering services under an ongoing fee arrangement and renewing the arrangement.
As part of the relief arrangement offered by ASIC, the FPA is required to meet and maintain certain minimum Code governance requirements and can apply sanctions to members who do not comply with the Code include termination of subscription to the Code and the removal of the exemption from the opt-in requirement.
The regulator stated advisers would still be required to renew ongoing fee arrangements but could set renewal intervals with clients, provided the interval was not more than three years.
ASIC said the FPA Professional Ongoing Fees Code was an approved code created for the sole purpose of seeking relief from the opt-in requirement and under the Corporations Act the regulator can exempt people from those requirements if they are bound by an approved code that provides the same oversight and control as the opt-in requirements.
The Code will be available from 1 July 2017 with FPA Chief Executive, Dante De Gori stating the approval of the Code was an acknowledgment from the regulator on the rigour and robust nature of FPA’s application, and is also evidence that Professional Codes can be approved.
In related news, the FPA has also secured recognition for its CFP Certification Program as an approved course in Australian Tax Law by the Tax Practitioners
Board (TPB).
As a result, advisers who hold the CFP designation and who have completed units CFP 1-5 will be deemed to have completed the Australian Tax Law subject, and will only need to complete an additional course in Commercial Law to re-register with TPB.
The FPA was first recognised by the TPB as a tax agent association in 2012 which allows FPA members who are tax (financial) advisers with six years in the past eight years of experience to be able to re-register with the TPB without needing to do additional study.
Am I correct in saying that based on the above, it is not a total exemption but rather an exemption from a 2 year period, extended out to a maximum 3 year period for FPA members?
I note: “The regulator stated advisers would still be required to renew ongoing fee arrangements but could set renewal intervals with clients, provided the interval was not more than three years.”
Have I misread????
Who knows Phil ?? It seems like they make up the rules as they go along ! The 2 year rule is hardly firm on the ground and we already have a change for some ? I guess I would like to know the rules and regulations imposed on the planner by the FPA ! They may be more restrictive then just sending the opt in
WHAT IS THE DIFFERENCE BETWEEN OPT IN AND OPT OUT
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