Financial disclosure regulations start in Feb 2008
New financial disclosure regulations to start in Feb 2008
Investment advisers will be required to provide up-front disclosure of fees and remuneration including commission from 29 February 2008, Commerce Minister Lianne Dalziel announced today.
This gives the industry three months notice to prepare for the regulation changeover and Lianne Dalziel is confident this is more than enough time for the new processes to be put in place and for the Securities Commission to implement its education programme targeted to investment advisers.
"The Securities Market Act was passed last year and there has been considerable consultation on the draft regulations since then so investment advisers are well aware that the regulations governing its implementation are on the horizon. Many advisers have already updated their disclosure practices in anticipation of the new requirements," Lianne Dalziel said
"I have no doubt they will be pleased that a commencement date has been set so full disclosure applies to everyone."
Lianne Dalziel said that the flaw in the previous disclosure regime was that although investment advisers had to make certain disclosures without being asked, important disclosures around commissions, for example, only needed to be made when they were requested.
"This led to the real problem that the least experienced investors, who arguably need the most protection, didn't know to ask for that information."
Lianne Dalziel said that the regulations giving effect to the legislation were approved by Cabinet today. Further information is available on the Ministry of Economic Development website: www.med.govt.nz