On 14 November 2023, Treasury released exposure draft legislation for consultation, proposing amendments to a number of statutes in response to the Quality of Advice Review.
Our team has made a formal submission on this consultation.
In summary, our submission addresses the proposed removal of the exception to the conflicted remuneration provisions for benefits given by a client for the issue or sale of a financial product. In our view, the removal of this exception is not consistent with the recommendations made in the Quality of Advice Review Final Report and would leave a gap in the amended regime.
We also make a number of submissions in relation to the scope and operation of the conflicted remuneration regime, and the proposed amendments to section 962T of the Corporations Act and 99FA of the SIS Act. These include that:
- additional provisions should be inserted into the Corporations Act to provide further clarity in relation to what benefits may be provided by a client to a licensee or representative without breaching the ban on conflicted remuneration;
- the current exceptions from the definition of conflicted remuneration for non-monetary benefits given in the circumstances set out in section 963C of the Corporations Act should apply equally to monetary benefits given in the same circumstances; and
- further amendments are required to ensure that a client's consent for benefits to be given on their behalf for the purposes of the conflicted remuneration regime, and for advice fees to be deducted from their superannuation account, can be appropriately transferred, for example in sale of business or successor fund transfer contexts (as relevant).
If you would like to read a copy of our submission, download a copy here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
