The Financial Planning Association of Australia The Financial Planning Association of Australia

FoFA


Important update

The government has committed to make minor amendment to the FoFA reforms, including an extension of the timeframe for advisers to send renewal opt-in notices and fee disclosure statements to retail clients from 30 to 60 days.

A Bill to implement these changes is currently progressing through the Parliamentary process. However, it requires final approval from the House of Representatives for the law to be changed. Unfortunately this did not occur before Parliament adjourned for the Christmas break.

This means that financial planners must continue to meet the current 30 day period to give clients an opt-in renewal notice and fee disclosure statement.

We are working with the Minister and ASIC to encourage the Regulator to take a facilitative approach to the 30 day timeframe until the final Bill is signed off by the HoR early in 2016 and becomes law.

Current FoFA requirements

ASIC’s facilitative approach to administering the FoFA regime ended on 30 June 2015. This means that financial planners and licensees must comply with the following measures:

  • Best interests duty – The best interests duty, including the “catch-all” provision (961B(2)(g) and 961E)
  • Opt-in – The opt-in regime will apply for all new clients (those who you sign up on, or after 1 July 2013), meaning the first opt-in notices will be required from 1 July 2015.*
  • Fee Disclosure Statements – you must send an FDS to all clients, including clients who joined before 1 July 2013.
  • Conflicted remuneration – The ban on conflicted remuneration applies to all financial product advice (i.e. general advice and personal advice).

* We are working with ASIC to have the FPA Code of Conduct approved for the opt-in exemption. This is taking some time and we encourage you to ensure you meet your opt-in requirements in the meantime.

Grandfathering – the grandfathering issue has been resolved and new regulations have been implemented to ensure that financial planners can move licensees while retaining grandfathered remuneration. The Regulations also remove the restriction of trade issues related to grandfathered benefits, and the sale and purchase of advice businesses.

Resources for FPA members

The FPA Member Centre, contains a comprehensive FoFA toolkit with a practical series of easy reference guides on the key reform areas, to help you meet the requirements of FoFA. Within the toolkit, you’ll find fact sheets, Q&As, and many other helpful resources.

Also included is our booklet ‘Taking Other Steps’ – a detailed guide on how to meet the FoFA best interest requirements.

FPA Member Centre

FPA Code of Professional Practice

Adhering to the FPA Code of Professional Practice, may also assist you in meeting the obligations of FoFA. For a refresh, download the Code

Download


Important links

Any questions?


We are always keen to hear your valuable feedback and suggestions. Please let us know if there are any policy issues or concerns that affect you.

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