by Susan Edmunds
Under the Financial Markets Conduct Act, all class DIMS providers – the FMA expects most DIMS to be class – will have to have a licence from December 1 this year. There will also be strict criteria for personalised providers.
It is expected that Cabinet may make a decision on the criteria for personalised DIMS by the end of May. Last month, the Ministry of Business Innovation and Employment consulted on the possibility of exemptions from licensing for some providers. A decision is expected in the coming months.
Adviser Wayne Ross said he had been told by MBIE that the Ministry was hoping to have more detail by the time its DIMS workshops rolled around, next month.
“When I pointed out the short timeframe from then until December 1 for those of us trying to decide what business we wished to be in they suggested maybe some time extension would need to be looked at.”
Ireland said time was becoming tight for those who would have to adjust their businesses to the new rules.
“More interesting [than exemptions] at this stage is what practical transition mechanism will be available to give time to adapt and move clients from the current systems.”
He said those who wanted to obtain a class licence would likely wait until that was approved before they started making changes. “Most will say until the rules are actually clear and the DIMS proposition is in order, they can’t do much with clients. Six months might sound a reasonable period but we still haven’t got the rules sorted and it will be a while before the applications are through.”
He said there would be some clients that advisers could not get hold of before December 1.
Ireland said most advisers he had dealt with were resigned to the fact the changes were coming.
“There’s the option available to advisers of remodelling to adapt their practice in light of the new environment,” he said.
“They can jump into a DIMS licence or align with someone who’s providing a DIMS licence or revise their practice so they’re no longer DIMS. My advice is to keep breathing keep up-to-date with what’s happening and look at your business model and how you want to operate post December 1.”
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