The Australian Securities and Investments Commission (ASIC) has been questioned in a Parliamentary Committee about whether the outlawing of shelf space fee arrangements has simply seen them morph into the payment of training fees by insurers.
NSW Labor Senator, Deborah O’Neill asked senior Australian Securities and Investments Commission (ASIC) officers whether, in anticipation of the outlawing of shelf space fees, they had transitioned into training fees.
O’Neill said during a public hearing of the Parliamentary Joint Committee on Corporations and Financial Services that her concern was that shelf fees, “which were the old way to get your product listed with these otherwise vertically integrated companies where the big amount of business is, had converted and morphed into something that was now outside some of the legislation that had tried to curb this practice, and they had turned into a training fee”.
Senior ASIC officer, Louise Macaulay said that training fees were allowed under the ban on conflicted remuneration but there are parameters around that and that training had to be in relation to the financial services business and it had to be a certain number of hours per day and not include travel and accommodation costs.
Macaulay said that ASIC had not followed up on the issue of whether shelf space fees morphed into training fees.