The Ministry of Business, Innovation and Employment (MBIE) is extending its consultation on transitions for discretionary investment management services (DIMS) until 8 April 2014. This consultation forms part of the consultation on the second exposure draft of the regulations for the implementation of Phase 2 of the Financial Markets Conduct Act 2013 (FMC Act) which closed on 14 March 2014.
Background to the consultation
The FMC Act implements a licensing regime for DIMS providers and makes changes for Authorised Financial Advisers (AFAs) providing DIMS under the Financial Advisers Act 2008.
These changes will require many AFAs and other DIMS providers to:
- obtain a licence under the FMC Act;
- shift property to an independent custodian (unless their licence permits them to retain a related custodian);
- make changes to client reporting systems, disclosure documents, client agreements, and other documentation; and
- change business practices to align them with FMC Act obligations around related party transactions and limit breaks.
MBIE are interested in receiving feedback on:
- whether there are limited circumstances in which AFAs should be able to continue providing DIMS without a full FMC licence; and
- the transitional relief required to give existing DIMS providers an appropriate period with which to comply with the new requirements under either the FMC Act or the amended Financial Advisers Act.
For further details and to make a submission online click here.