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FSR Act hits its straps

THE roll out of Financial Services Reform Act will step up a gear in the next two weeks, with seven policies due for release before December 1.

The next wave of policies will focus on the licensing and disclosure requirements of the FSR, providing a final stance on the organisational capacity, the training of financial product advisers, dispute resolution, financial requirements and product disclosure.

Policy statements on how the Australian Securities and Investment Commission plans to use its discretionary powers to grant licensing and disclosure relief to businesses in exceptional circumstances is also due within a fortnight.

Two other policies on advice and dealing and transitional provisions may emerge before the end of the month.

The hefty schedule comes after a steady release of guides and policy proposal papers.

Up for release in December is a policy statement on market operators and guidelines on licensing kits.

The statement on organisational capacity is expected to reconfirm that Australian Financial Services licensees are responsible for legislation compliance and will echo the earlier policy proposal paper in detailing these compliance responsibilities.

These include having sufficient organisational expertise and skills, non-financial resources, risk management systems and internal assessment and monitoring arrangements.

The policy statement on the training of financial advisers, however, is to be modified from the interim policy statement released in April this year.

Additional information on explicit training standards that must be met by authorised representatives who provide financial product advice to retail clients also will be included.

Product disclosure requirements may become more detailed, with the new Treasury provisions that product disclosure statements including information on the extent to which social, environmental or ethical considerations are taken into account in the selection, retention or realisation of an investment.

The provision was added in August as a final amendment to the FSR Bill, despite concerns that ASIC disclosure provisions required a very high level of detail.

Policies on dispute resolution and financial requirements are not expected to deviate from that suggested in the respective policy proposal papers.

p ASIC regional commissioner Michael Gething will outline the latest Financial Services Reform policy at a Business News breakfast on November 22.

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