Financial adviser registration to occur in two stages

Financial adviser registration under the Better Advice Act will occur in two stages, the corporate regulator has revealed.

The act required all advisers who provided personal advice to retail clients about relevant financial products be registered by 1 January, 2023.

The Australian Securities and Investments Commission (ASIC) said the first stage provided a one-off registration process administered by ASIC using the existing Financial Adviser Register (FAR).

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Financial advisers who were registered with the Tax Practitioners Board (TPB) as a tax (financial) adviser as at 31 December, 2021, would generally be deemed to be registered with ASIC under stage one.

The regulator said stage two commenced once the FAR transitioned to the Australian Tax Office as part of the Australian Business Registry System (ABRS).

ASIC noted it would provide guidance on registration later in the year.




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Can anyone explain the benefit of this? Does it mean we are doing away with the AFSL system?

Yes ditto that. Does that mean dealer groups are done and dusted, or we still needs AFSLs and dealer groups?

'Dealer Group' is old terminology for an AFSL. So let's dispense with that.
Currently, a) your AFSL updates and maintains your licensing registration through the ASIC portal and b) you have to maintain your own registration with the TPB.
TPB is going. Upon this change, after the transition, there will only be one registration and you will henceforth be responsible for it.
There is no change to the need to be authorised by an AFSL.

I am glade that this adds value to my clients and makes my life easier. Thank your Royal Commission, thank you ASIC, and thank you FPA and AFA!

Right, so basically its nothing. Its just one less job for a licensee. Maybe that means they can discount their $50k fees to $49,950 lol.

Sorry each individual Adviser does not have to update the TPB. I am the AFSL RM & Adviser and I am our only Adviser registered with TPB, and I also over see our other Advisers (up to 20) for the TPB, each Adviser does nothing to update TPB.

Yes Advisers not registered - and there are many of course where the AFSL had a sufficient number of persons registered with the TPB - don't have to maintain a registration if they didn't have one to begin with. One would think that follows.

If only we could dispense with dealer groups Cal!

AFSL is the ASIC issued licence, which can be held by 3 different types of businesses:
- self employed advisers operating under their own licence
- advice practices with their own licence who employ other advisers (known as Representatives) to operate under their licence
- dealer groups who sub licence other advisers (known as Authorised Representatives) to operate under their licence

Dealer groups are sadly still the primary means by which most advisers are licensed. They are a business type rather than an official licence category. They are a hangover from the old tied agency days but they are still alive and well and still do much the same thing, which is to exert control over advisers as a means of distributing inhouse product. If we can't get rid of AFSLs altogether then at least we should get rid of this unnecessary sub licensing option that gifts so much power to product companies. BTW any dealer group that has an inhouse SMA that generates additional FUM revenue, is still a product company.

The end of the AFSL 'Adviser Group' is very close.
I would say that our "arrangements" will look quite similar to Accountants in the near future, but that would likely upset people using that comparison.
Nonetheless that's where we are headed, as "untied" professionals.

- advice practices with their own licence who employ other advisers (known as:
Authorised Representatives)
to operate under their licence.
Sorry under what section of the law is the separate categories of Representative or Authorised Rep ?

As always with the Corps Act, the ultimate meaning is captured via a collection of interconnected, largely incomprehensible paragraphs. However Regulatory Guide 36 has a clearer explanation, particularly 36.101(b) and the Key Terms definitions..

In essence it says employees who meet the relevant training and registration requirements can act as a Representative of an AFSL. If you're not an employee, you need to be specifically Authorised to act as their Representative.

OK, all our employee Advisers are Authorised Reps on ASIC Websites, FAR, etc ???
I'm confused but does it really matter ?

Employees don't need to be Authorised Reps, but if they are it doesn't really matter.

However non employees who operate under your licence do need to be Authorised Reps, and that matters a lot. It is essentially an undertaking by the licensee to ensure a similar level of selection, training, resourcing and supervision as if they were your employees. Of course this can be quite difficult to do properly if those Authorised Representatives work for their own company, in a different location, with their own systems and processes, and a perception that they have a large degree of independence. It is one of the big problems with the current licensing model.

So, what compensation do I get as a sole AFSL holder? All the money, time red tape. Abolish it and the needs to be compo. Love to see AR s pay their own PI insurance, it would hurt.

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