by Rob Hosking
The Task Force panel has released a summary of the 100-odd submissions to its earlier options paper.
Of the four options there was the least support for a “designated occupation” approach, “particularly when restrictions were tied to methods of remuneration for intermediaries.”
Both Australia and the United Kingdom have gone down this route, putting restrictions on which financial advisers may market themselves as independent. However it is clear from the Task Force’s release that such a move would not be popular with the industry here.
Some combination of the three other options was more popular: these included general legal standards, registration, and licensing.
“There was considerable support for licensing of intermediaries, though some also considered that this option would be too costly when balanced against the benefits of licensing.”
A clear pointer in yesterday’s release is a note about a “co-regulatory” approach. As Good Returns reported last week, the Task Force has quietly asked a number of industry groups to submit separate papers on what co-regulation might look like.
Yesterday’s release seems to give those industry groups some indication of the Task Force’s own thinking: co-regulation could include aspects of all four of the Task Force's options. The key features would be:
The task force is due to make its final report to the Minister of Commerce in the next few weeks.
Rob Hosking is a Wellington-based freelance writer specialising in political, economic and IT related issues.
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