On 15 March 2021, the Financial Services Legislation Amendment Act 2019 (FSLAA) amended the Financial Markets Conduct Act 2013 (FMCA). This overhaul of financial advice law affected anyone who gives financial advice in New Zealand. The law aims to ensure the availability of financial advice for persons seeking that advice, and ensure the quality of financial advice and financial advice services (FMCA, section 431B).
The law requires anyone who gives regulated financial advice to retail clients to have, or be engaged under, a financial advice provider licence issued by the Financial Markets Authority (FMA). There are five key elements to the FMCA for financial advice law:
the Financial Markets Conduct Act 2013;
the Code of Professional Conduct for Financial Advice Services (the Code),
disclosure requirements in the Financial Markets Conduct Regulations 2014 (disclosure regulations);
licensing requirements issued by the FMA; and
fees listed in the Financial Markets Conduct (Fees) Regulations 2014 and levies listed in the Financial Markets Authority (Levies) Regulations 2012.
The previous law, the Financial Advisers Act 2008 (FAA), contained a clause requiring the Ministry of Business, Innovation and Employment (MBIE) to review and report on how it was operating within five years of commencement. MBIE released its report in July 2016. This report led to a robust process of consultation and review that resulted in FSLAA. During the following five years, the review involved three official entities: MBIE, the FMA, and the Code Working Group (now the Code Committee). These entities released information at different times, through their own channels.
The Financial Services Council (FSC) consolidated information from these sources, and summarised it for financial advisers. As more details were released, the FSC published a Professional Advice Hub online, summarising the latest information from these sources into one place. Now that all the details are finalised, this guide brings that information together into a single, convenient document.