A person who provided financial advice in a foreign country is commonly referred to as a ‘foreign adviser’ within the financial advice industry. They will be recognised as an existing provider if they meet the conditions in subparagraph (b) of the definition of ‘existing provider’ in section 1546A of the Corporations Act 2001 (Corporations Act) – that is, they:
- provided personal advice (as defined in section 766B(3) of the Corporations Act) at any time between 1 January 2016 and 1 January 2019:
- in a foreign country
- to retail clients (as defined in sections 761G and 761GA of the Corporations Act. For more information on whether advice is provided to a retail client, see Regulatory Guide 175 AFS licensing: Financial product advisers – Conduct and disclosure (RG 175)), and
- in relation to relevant financial products (as defined in section 910A of the Corporations Act), and
- were not prohibited under the law of the foreign country from providing such advice on 1 January 2019.
How AFS licensees can determine whether a foreign adviser is an ‘existing provider’
To determine whether a foreign adviser is an ‘existing provider’, an AFS licensee should ask the individual to provide evidence showing that they meet the conditions in subparagraph (b) of the definition of ‘existing provider’ in section 1546A of the Corporations Act.
All these elements must be satisfied for a foreign adviser to be recognised as an ‘existing provider’.
If a foreign adviser is unable to provide evidence that they satisfy some or all these elements of the definition of ‘existing provider’, the regulator of the relevant overseas jurisdiction may be contacted to obtain information about the person. Information about the person may also be publicly available on a register maintained by the overseas regulator.
If the information provided by the regulator about the foreign adviser is insufficient to evidence that the individual is an ‘existing provider’, the individual’s employers during the relevant period may be contacted to supplement the regulator’s information.
The information from the overseas regulator, and employers where relevant, should address each element in subparagraph (b) of the definition of ‘existing provider’ in section 1546A of the Corporations Act. If they do not adequately address each element, the person who provided financial advice in a foreign country will be considered a person training to become a relevant provider.
