Advisers have 3 months to prepare for new laws
Investment advisers will be required to provide up-front disclosure of fees and remuneration including commission from February 29, Commerce Minister Lianne Dalziel says.
Tuesday, December 4th 2007, 5:09AM
The commission is preparing a Guide to New Securities Law 2008 which explains these changes. This is expected to be available electronically before Christmas.
"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," Dalziel said.
"I have no doubt they will be pleased that a commencement date has been set so full disclosure applies to everyone."
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."
The regulations giving effect to the legislation were approved by Cabinet Monday.
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