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Codes & Ethics for Advisers

The Australian Securities and Investment Commission (ASIC) announced earlier this week that Australian Financial Services Licensees may have some leeway when it comes to complying with an approved compliance scheme.

AFSLs will not be in trouble if their financial advisers are unable to register with an approved compliance scheme by the start of next year.

However, the regulator still expects AFSLs to have taken reasonable steps to comply and advisers will still have to comply with the code.

“After consultation with FASEA, ASIC will take a facilitative approach to compliance with Standards 3 and 7 of the code until the new single disciplinary body is operational.”

Under Standard 3:

  • You must not advise, refer or act in any other manner where you have a conflict of interest or duty.

Under Standard 7:

  • The client must give free, prior and informed consent to all benefits you and your principal will receive in connection with acting for the client, including any fees for services that may be charged. If required in the case of an existing client, the consent should be obtained as soon as practicable after this Code commences.

According to ASIC, the reasonable steps expected by the regulator of Australian Financial license holders include:

making sure that their advisers are aware that they need to comply with the code from 1 January 2020 onwards;

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