The Australian Securities and Investments Commission (ASIC) today released an updated Policy Statement 146 Licensing: Training of financial product advisers [PS 146].

The policy statement sets out minimum training standards for people providing financial product advice to retail clients.

The update revises guidance on the training requirements for advisers on basic deposit products and related non-cash payment products (BDPs).

The guidance has been provided in completion of one of ASIC’s projects implementing the Australian Government’s proposals paper Refinements to Financial Services Regulation (2 May 2005). ASIC is working on eight refinement projects as set out in ASIC Information Release [IR 05-22] ASIC provides details on financial services refinement projects (12 May 2005).

‘In providing this guidance, ASIC is responding to industry concerns that training requirements in PS 146 for persons giving general or personal advice on BDPs should be made more flexible’, ASIC’s Assistant Director of Regulatory Policy, Ms Joanna Bird said.

In particular, the update makes it clear that:

• it is no longer mandatory for training courses for advisers on BDPs to cover the ‘generic knowledge’ requirements contained in PS 146;
• training on BDPs need only cover the particular ‘specialist’ knowledge and ‘skill’ requirements in PS 146 that are relevant to the adviser’s activities; and
• there might be situations where continuing training is not necessary for all persons who advise on BDPs. The licensee will first need to consider whether continuing training is required. It may be that there is no need if, for instance, the products have not changed.

Ms Bird said the updated policy would give licensees greater flexibility to tailor training to suit their BDP advisory activities, without the cost of unnecessary mandatory generic knowledge training.

‘Consistent with the outcome sought by PS 146, staff will become competent to advise on those products but in a shorter time frame. Our changes to policy should further facilitate wide access to advice on BDPs for consumers’, Ms Bird said.

If advisers provide financial product advice on other products, in addition to BDPs, they will have to comply fully with the PS 146 requirements for those other products.

Removing redundant content of PS 146

ASIC has also taken the opportunity to update PS 146 by removing references that are no longer current. Amendments to PS 146 are set out in the attachment.

The amended PS 146 [PS 146]. is available on the ASIC website at www.asic.gov.au (on the training page via the Financial Services homepage). Copies can also be obtained by calling the ASIC Infoline on 1300 300 630.

Attachment to [IR 05-48]: Summary of amendments to PS 146 Licensing: Training of financial product advisers

The amendments fall into two categories:

1. Amendments regarding training requirements for basic deposit products and related non-cash payment facilities (BDPs)

The specific amendments in this category are as follows:

• Clarification that training courses for persons advising on BDPs do not need to cover the ‘Generic’ knowledge requirements [PS 146.49], [PS 146.55(a)], [PS 146.61 Note], [PS 146.61A Note], [PS 146.118B]
• Clarification that training on BDPs need only cover the particular ‘specialist’ knowledge and ‘skill’ requirements in PS 146 that are relevant to the adviser’s activities [PS146.46 Table 4], [PS 146.126 Note and Table A2.7]
• Clarification that there may be occasions where continuing training isn’t necessary for persons advising on BDPs [PS 146.109 Note].

2. Removing references in the PS that are no longer current

The specific amendments in this category are as follows:

• References to licensees as defined in the old Corporations Act 2001 have been deleted [PS 146.12], [PS 126.21]
• Section C [PS 146.30] – PS 146.41] ‘When must advisers meet the training standards’ has been deleted. This transitional guidance is no longer needed.
• References to pre-1995 training have been deleted [PS 146.67] - [PS 146.72]. These paragraphs are no longer needed
• Information about verifying foreign qualifications has been updated [PS 146.73]
• References to the Financial Services Training Package and Statement of Attainment pre 31 December 2002 have been deleted [PS 146.98], [PS 146.100]
• Reference to the third party that assists ASIC in assessing training courses to be placed on the Training Register has been replaced with a note stating that ASIC may from time to time engage a third party to assist it in assessing those courses [PS 146.101].

Download a copy of Policy Statement 146 Licensing: Training of financial product advisers [PS 146]