A professional standards regime for financial advisers will commence from 1 January 2019. All Australian Financial Services (AFS) Licensees and their representatives and Limited AFS Licensees and their representatives will be required to comply.
The Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 will establish:
- compulsory education requirements for both new and existing financial advisers
- supervision requirements for new advisers
- a code of ethics for the industry
- an exam that will represent a common benchmark across the industry
- an ongoing professional development component.
A Commonwealth standards setting body to govern the professional standing of the financial advice industry was established on 13 June 2017. The Financial Adviser Standards and Ethics Authority (FASEA) will be responsible for setting the educational requirements, developing and setting the exam, and creating the uniform Code of Ethics.
The new professional standards requirements will commence on 1 January 2019. From this date, new advisers will be required to hold an appropriate degree before they can commence the supervision year and sit the exam.
Existing advisers will have until 1 January 2021 to pass the new exam and until 1 January 2024 to reach degree-equivalent status.
The Code of Ethics will commence on 1 January 2020.
Further details of the requirements will be provided as they are released by FASEA.