The report of the Senate Economics Legislation Committee on the amended Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014 was tabled in the Senate Mon 22.9.2014. It recommended that the Senate pass the Bill. The amended Bill contains new measures proposed by the Palmer United Party (PUP) and the Motoring Enthusiasts Party (MEP). The Labor and Greens Senators on the Committee issued dissenting reports opposing the amendments in the Bill.
The Bill includes the following key amendments to FoFA:
- removing the need for clients to renew their ongoing fee arrangement with their adviser every 2 years (also known as the “opt in” requirement);
- making the requirement for advisers to provide a fee disclosure statement only applicable to clients who entered into their arrangement after 1 July 2013;
- removing para 961B(2)(g) of the Corporations Act, the “catch all” provision, from the list of steps an advice provider may take in order to satisfy the best interests obligation;
- additional disclosure and information in the SoA in relation to existing rights of the client and obligations of the provider of advice;
- ensure that any instructions for further or varied advice from the client are: documented in writing; signed by the client; and acknowledged by the providing entity, or an individual acting on behalf of the providing entity.
[LTN 184, 23/9/14]