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Advisers: Licence process simple, but not many have done it

Advisers who have completed the process to obtain a transitional licence say it was straightforward. However, the number of licences issued is low.

Tuesday, December 17th 2019, 9:42PM 5 Comments

Transitional licensing for the new financial advice regime started on November 25. As of last Friday, 38 transitional licences had been approved and none had been declined.

One estimate is 2,300 licences will be issued and there are less than 200 days (including weekends) until licensing closes. 

Adviser Peter Wannan said his application for an individual FAP licence was turned around in less than two weeks.

Advisers can choose whether to apply for an individual licence as an individual or as their company, identifying themselves as a financial adviser working for it.

Wannan said the only confusing aspect of the application was having to go to the Financial Service Providers Register and enter his details there first. “I had to go to the FSPR, apply for the fact I was going to apply then leave it for 24 hours then go to the FMA.”

Jon-Paul Hale agreed the application process was not difficult. “The initial licensing aspect is more about just getting the people on the playing field. There are no checks of whether you are up to standard.”

Katrina Shanks, chief executive of Financial Advice New Zealand, said the understanding of how to begin the process was the trickiest bit.

“People struggle to think how to get in. They don’t think to go to the Companies Office.”

People who were previously licensed under their own names but wanted a FAP under a company name would end up with two entries. Shanks said there was an option to get a refund of the original registration fee but the process to obtain that was confusing for some people.

“Other than that it’s positive. We’re telling people to take their time because you do have to think as you go.”

Some advisers were unsure about whether to take a FAP licence in their own names or operate as an authorised body under an entity FAP, Shanks said.

She said advisers who applied for a FAP licence in their own names would not be able to refer to themselves as financial advisers, only financial advice providers, but those who were an authorised body under an entity with a FAP licence could.

Tags: FAP Financial Services Legislation Amendment Bill Katrina Shanks licensing

« Ross parole: Investors emotionalMBIE urges caution for FAPs engaging multiple advisers »

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Comments from our readers

On 18 December 2019 at 9:08 am Elephant1 said:
Wanting to see our rental agreement on our offices!
Wanting to know what hours our offices are open, a bit unusual.
On 18 December 2019 at 10:34 am Murray Weatherston said:
@Elephant1
Were those queries from
(1) Companies Office - FSPR; or
(2) FMA.
I am aware of a cse where a sole adviser was seeking FSPRegistration for his company (previously sole adviser exemption) and the queries from companies office were endless!
On 18 December 2019 at 11:13 am JPHale said:
@Elephant1 sounds more like the FSPR registration of the company questions.

To add to my comments in the article, I already had my company listed on the FSPR so it was simple and straightforward to select the applying for a transitional licence option and get on with it.

The bit that is the head scratch is going to the FMA site first and then going; Huh? I can't list my stuff once logged in.

And the form on the FMA site isn't that helpful about pointing you in the right direction.

I purposely ignored most of the associated documentation, as that's what I tend to do with 'systems'. Taking the suck it and see approach to user interface design to see how it goes.

On the whole, once figuring out that the link from the FSPR needs to be setup, which I knew if you have read my other comments, then it was sort the FSPR, wait overnight for processing to the FMA, and finish up on the FMA site.

All told about 40 minutes, plus the registration of your company if you have to do that.
On 18 December 2019 at 12:14 pm guscott said:
Interesting -applied for licence 2 Dec - got auto reply from FMA and heard nothing since.
On 18 December 2019 at 12:54 pm Simon Papa said:
Murray, Those queries will be from the Companies Office/FSPR. All new registration applicants get a long list of questions of that type. The FSPR is trying to identify whether the financial service business is genuine, because of past misuse of the register. If applying to be FSPR registered for the first time applicants should factor in a few extra days to respond and for the response to be assessed.

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