Key Documents
The Corporations Amendment (Future of Financial Advice) Bill 2012 and the Corporations Amendment (Further Future of Financial Advice Measures) Bill 2012 (the Bills) were introduced into the House of Representatives on 13 October 2011 and 24 November 2011 respectively. Both Bills passed the House of Representatives on 22 March 2012. The Bills amend the Corporations Act 2001 to introduce the Future of Financial Advice reforms.
To accompany the measures in the Bills a number of amendments to the Corporations Regulations 2001 (the Principal Regulations) will be made. The first two packages of amendments were released for consultation on 23 May 2012 and closed on 5 June 2012.
The third package of amendments is the Corporations Amendment Regulation 2012 (No. ) which relates to the best interests obligation and the ban on conflicted remuneration as proposed by the Bills. Specifically, the amendments to the Principal Regulations:
- allow an agent or employee of an Authorised Deposit-taking Institution to take advantage of a reduced best interests obligation when a client has sought advice on a combination of certain products;
- prescribe the circumstances when a benefit that relates to more than one already exempt product is not conflicted remuneration;
- exempt ‘stamping fees’ from the ban on conflicted remuneration; and
- exempt employee remuneration based on brokerage fees from the ban on conflicted remuneration for market participants.
The documents linked below provide an exposure Regulation and a draft Explanatory Statement for the third package of regulations with respect to the measures proposed in the Bills.