Commonwealth: Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 (Cth)

Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 No. 7, 2017 An Act to amend the law relating to financial services, and for related purposes Contents 1 Short title 2 Commencement 3 Schedules Schedule 1—Amendments Part 1—Amendments Corporations Act 2001 Tax Agent Services Act 2009 Part 2—Application of amendments Corporations Act 2001 Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 No. 7, 2017 An Act to amend the law relating to financial services, and for related purposes [Assented to 22 February 2017] The Parliament of Australia enacts: 1 Short title This Act is the Corporations Amendment (Professional Standards of Financial Advisers) Act 2017. 2 Commencement (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms. Commencement information Column 1 Column 2 Column 3 Provisions Commencement Date/Details 1. The whole of this Act A single day to be fixed by Proclamation. 15 March 2017 However, if the provisions do not commence within the period of 6 months beginning on the day this Act receives the Royal Assent, they commence on the day after the end of that period. (F2017N00017) Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act. (2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act. 3 Schedules Legislation that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms. Schedule 1—Amendments Part 1—Amendments Corporations Act 2001 1 Section 910A Insert: basic banking product has the meaning given by section 961F. body corporate licensee means a body corporate that: (a) is a financial services licensee; and (b) is authorised to provide personal advice to retail clients in relation to relevant financial products. class of product advice means financial product advice about a class of products, but does not include a recommendation about a specific product in the class. Code of Ethics means the Code of Ethics, as in force from time to time, made by the standards body under paragraph 921U(2)(b). compliance scheme has the meaning given by section 921G. consumer credit insurance has the meaning given by section 11 of the Insurance Contracts Act 1984. control, in relation to a body corporate licensee, means: (a) having the capacity to cast, or control the casting of, more than one half of the maximum number of votes that might be cast at a general meeting of the licensee; or (b) directly or indirectly holding more than one half of the issued share capital of the licensee (not including any part of the issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital); or (c) the capacity to control the composition of the licensee's board or governing body; or (d) the capacity to determine the outcome of decisions about the licensee's financial and operating policies, taking into account: (i) the practical influence the person can exert (rather than the rights it can enforce); and (ii) any practice or pattern of behaviour affecting the licensee's financial or operating policies (whether or not it involves a breach of an agreement or a breach of trust). covers, in relation to a compliance scheme, has the meaning given by section 921J. CPD year (short for continuing professional development year): a financial services licensee's CPD year is the 12‑month period beginning on the day of the year included in the most recent notice given by the licensee under section 922HA. education and training standards has the meaning given by section 921B. foreign qualification means a bachelor or higher degree, or equivalent qualification, awarded by a tertiary education institution outside Australia. limited‑service time‑sharing adviser: a person is a limited‑service time‑sharing adviser if: (a) the person is a relevant provider; and (b) the only relevant financial product that the person provides advice in relation to is a time‑sharing scheme; and (c) the person has not met any one or more of the education and training standards in subsections 921B(2) to (4). monitoring body for a compliance scheme means the person that monitors and enforces compliance with the Code of Ethics under the scheme. notice provision means section 922D, 922H, 922HA, 922HB, 922HD, 922J or 922K. professional association means a body or association that represents a section of the financial services industry. provisional relevant provider means a relevant provider who is undertaking work and training in accordance with subsection 921B(4). Note: For rules relating to provisional relevant providers, see Subdivision C of Division 8A and section 923C. recent advising history has the meaning given by section 922G. Register of Relevant Providers means the Register of Relevant Providers maintained under section 922Q. relevant financial products means financial products other than: (a) basic banking products; or (b) general insurance products; or (c) consumer credit insurance; or (d) a combination of any of those products. relevant provider: a person is a relevant provider if the person: (a) is an individual; and (b) is: (i) a financial services licensee; or (ii) an authorised representative of a financial services licensee; or (iii) an employee or director of a financial services licensee; or (iv) an employee or director of a related body corporate of a financial services licensee; and (c) is authorised to provide personal advice to retail clients, as the licensee or on behalf of the licensee, in relation to relevant financial products. Note: For rules about when relevant providers can use the expressions "financial adviser" and "financial planner", see section 923C. standards body means the body corporate in relation to which a declaration under section 921X is in force. supervisor of a provisional relevant provider has the meaning given by subsection 921F(2). 2 Paragraph 912A(1)(f) After "adequately trained", insert "(including by complying with section 921D)". 3 Subsection 913B(1) (note) Omit "Note", substitute "Note 1". 4 At the end of subsection 913B(1) Add: Note 2: There are limitations on ASIC granting an individual an Australian financial services licence that covers the provision of certain personal advice if the individual does not meet the education and training standards in subsections 921B(2) to (4) (see section 921C). 5 At the end of subsection 916A(1) Add: Note: There are limitations on a financial services licensee authorising an individual to provide certain personal advice if the individual does not meet the education and training standards in subsections 921B(2) to (4) (see section 921C). 6 At the end of subsection 916A(3) Add: ; or (c) in contravention of subsection 921C(2). 7 Subsection 916B(2) After "contrary to this section", insert "or subsection 921C(3)". 8 Subsection 916B(2A) After "contrary to this section", insert "or subsection 921C(3)". 9 At the end of subsection 916B(3) Add: Note: There are limitations on sub‑authorising an individual to provide certain personal advice if the individual does not meet the education and training standards in subsections 921B(2) to (4) (see section 921C). 10 After paragraph 920A(1)(da) Insert: (db) the person has not complied with any one or more of his or her obligations under section 921F (requirements relating to provisional relevant providers); or (dc) both of the following apply: (i) a supervisor referred to in section 921F has not complied with any one or more of his or her obligations under that section in relation to a provisional relevant provider; (ii) both the supervisor and the provisional relevant provider are authorised to provide personal advice to retail clients, on behalf of the person, in relation to relevant financial products; or (dd) both of the following apply: (i) a provisional relevant provider has not complied with his or her obligations under subsection 921F(7); (ii) the provisional relevant provider is authorised to provide personal advice to retail clients, on behalf of the person, in relation to relevant financial products; or (de) ASIC has reason to believe that the person was authorised, in contravention of subsection 921C(2), (3) or (4), to provide personal advice to retail clients in relation to relevant financial products; or 11 Paragraph 920A(1)(e) After "financial services law", insert "(other than section 921E (relevant providers to comply with the Code of Ethics))". 12 After Division 8 of Part 7.6 Insert: Division 8A—Professional standards for relevant providers Subdivision A—Education and training standards 921B Meaning of education and training standards (1) This section sets out the education and training standards for a person who is, or is to be, a relevant provider. Conditions for relevant providers (2) The first standard is that: (a) the person has completed a bachelor or higher degree, or equivalent qualification, approved by the standards body under section 921U; or (b) both of the following conditions are satisfied: (i) the person has completed a foreign qualification; (ii) the standards body has approved the foreign qualification under section 921V. (3) The second standard is that the person has passed an exam approved by the standards body. (4) The third standard is that the person has undertaken at least 1 year of work and training that meets the requirements set by the standards body. Note: A relevant provider who is undertaking work and training in accordance with this subsection is a provisional relevant provider (see the definition of provisional relevant provider in section 910A). For rules relating to provisional relevant providers, see Subdivision C. Continuing standard for relevant providers (5) The fourth standard is that the person meets the requirements for continuing professional development set by the standards body. Note: A provisional relevant provider is not required to meet this standard (see section 921D). 921C Limitation on authorisation to provide personal advice unless conditions met Financial services licensees (1) ASIC must not grant an applicant an Australian financial services licence that covers the provision of personal advice to retail clients in relation to relevant financial products if: (a) the applicant is an individual; and (b) the applicant has not met any one or more of the education and training standards in subsections 921B(2) to (4). Note: Subsections 921B(2) to (4) set out the conditions for education and training for relevant providers. Authorised representatives (2) A financial services licensee must not, under section 916A, give a person a written notice authorising the person to provide personal advice to retail clients, on behalf of the licensee, in relation to relevant financial products if: (a) the person is an individual; and (b) either or both of the following subparagraphs apply: (i) the person has not met either or both of the education and training standards in subsections 921B(2) and (3); (ii) the person has not met the education and training standard in subsection 921B(4), and is not undertaking work and training in accordance with that subsection. Sub‑authorisations (3) An authorised representative of a financial services licensee must not, under subsection 916B(3), give an individual a written notice authorising that individual to provide personal advice to retail clients, on behalf of the licensee, in relation to relevant financial products if either or both of the following paragraphs apply: (a) the individual has not met either or both of the education and training standards in subsections 921B(2) and (3); (b) the individual has not met the education and training standard in subsection 921B(4), and is not undertaking work and training in accordance with that subsection. Employees and directors (4) A financial services licensee must not authorise an employee or director of the licensee, or of a related body corporate of the licensee, to provide personal advice to retail clients, on behalf of the licensee, in relation to relevant financial products if either or both of the following paragraphs apply: (a) the employee or director has not met either or both of the education and training standards in subsections 921B(2) and (3); (b) the employee or director has not met the education and training standard in subsection 921B(4), and is not undertaking work and training in accordance with that subsection. Exemption in relation to time‑sharing schemes (5) This section does not apply in relation to a person who is to provide personal advice to retail clients in relation to relevant financial products if the only relevant financial product in relation to which the person is to provide personal advice to retail clients is a time‑sharing scheme. 921D Relevant providers to meet continuing professional development standard (1) A relevant provider must comply with subsection 921B(5): (a) if the relevant provider is a financial services licensee—during the licensee's CPD year; or (b) if the relevant provider is authorised to provide personal advice to retail clients, on behalf of a financial services licensee, in relation to relevant financial products—during the licensee's CPD year. Note 1: Subsection 921B(5) requires a relevant provider to meet the continuing professional development standard. Note 2: Section 922HB requires a notice to be given at the end of a financial services licensee's CPD year if a relevant provider has not complied with this section during that year. Exemptions (2) Subsection (1) does not apply in relation to a person if: (a) the person is a provisional relevant provider; or (b) the only relevant financial product in relation to which the person provides personal advice to retail clients is a time‑sharing scheme. Subdivision B—Ethical standards 921E Relevant providers to comply with the Code of Ethics A relevant provider must comply with the Code of Ethics. Note: A failure to comply with the Code of Ethics must be notified under section 922HD. Subdivision C—Provisional relevant providers 921F Requirements relating to provisional relevant providers (1) This section sets out the requirements in relation to a person who is a provisional relevant provider. Meaning of supervisor (2) A supervisor of a provisional relevant provider is an individual who: (a) has supervisory responsibility for the provisional relevant provider; and (b) is a relevant provider; and (c) is not a provisional relevant provider; and (d) is not a limited‑service time‑sharing adviser. Role of supervisors (3) A supervisor of a provisional relevant provider must ensure that appropriate supervision is provided to the provisional relevant provider. (4) A supervisor of a provisional relevant provider must approve, in writing, any Statement of Advice provided by the provisional relevant provider to a retail client. Personal advice provided by provisional relevant providers (5) For the purposes of this Act, personal advice provided (whether orally or in writing) by a provisional relevant provider at a particular time to a retail client in relation to a relevant financial product is taken to have been provided to the client by each person who is, at that time, a supervisor of the provisional relevant provider (instead of by the provisional relevant provider). Retail clients to be informed of certain matters (6) A supervisor of a provisional relevant provider must ensure that a retail client is informed: (a) of the name of each supervisor of the provisional relevant provider (even if the retail client has been informed of the name of each previous supervisor); and (b) that the provisional relevant provider is undertaking work and training in accordance with subsection 921B(4); and (c) that each supervisor is responsible for any personal advice provided by the provisional relevant provider to the client in relation to a relevant financial product. Provisional relevant providers not to obstruct or hinder supervision (7) A provisional relevant provider must not obstruct or hinder a supervisor of the provisional relevant provider in ensuring that appropriate supervision is provided to the provisional relevant provider. Note: Under section 921U, the standards body may provide further for the purposes of this section. Division 8B—Compliance schemes Subdivision A—Compliance schemes to cover relevant providers 921G Meaning of compliance scheme (1) A compliance scheme is a scheme: (a) that meets the requirements of this section; and (b) under which compliance with the Code of Ethics by relevant providers covered by the scheme is monitored and enforced. Monitoring body of compliance scheme (2) A monitoring body for a compliance scheme must monitor and enforce compliance with the Code of Ethics by any relevant provider covered by the scheme. (3) A monitoring body for a compliance scheme must not be: (a) a financial services licensee; or (b) an associate of a financial services licensee. (4) A compliance scheme must name the monitoring body for the scheme. Disputes and complaints (5) A compliance scheme must set out how a dispute is to be resolved between the monitoring body for the scheme and a relevant provider covered by the scheme. (6) A compliance scheme must set out how a person may make a complaint to the monitoring body for the scheme in relation to a failure to comply with, or possible failure to comply with, the Code of Ethics by a relevant provider covered by the scheme. Name of compliance scheme (7) A compliance scheme must have a name. 921H Financial services licensees to ensure compliance scheme covers relevant providers (1) A financial services licensee must ensure that a compliance scheme covers: (a) if the licensee is a relevant provider—the licensee; and (b) in any case—any relevant provider authorised to provide personal advice to retail clients, on behalf of the licensee, in relation to relevant financial products. Note: For when a compliance scheme covers a relevant provider, see section 921J. (2) A compliance scheme must cover a relevant provider within 30 business days of the following: (a) the day the person becomes a relevant provider; (b) if the relevant provider was previously covered by only one compliance scheme that has ceased to cover the relevant provider—the day that scheme ceased to cover the relevant provider. 921J When a compliance scheme covers a relevant provider (1) A compliance scheme covers a relevant provider if: (a) an approval is in force under section 921K in relation to the compliance scheme; and (b) the condition in subsection (2) of this section is met for the relevant provider; and (c) if the monitoring body for the compliance scheme is a professional association—the relevant provider is a member of the professional association. Notifying ASIC of the compliance scheme that covers a relevant provider (2) The condition in this subsection is met for a relevant provider in relation to a compliance scheme if: (a) both of the following apply: (i) the notice lodged under section 922D in relation to the relevant provider stated that the compliance scheme is to cover the relevant provider; (ii) no notice has been lodged under section 922H stating that another compliance scheme is to cover the relevant provider; or (b) the most recent notice lodged under section 922H, in relation to particulars entered on the Register of Relevant Providers about the compliance scheme that is to cover the relevant provider, stated that the compliance scheme is to cover the relevant provider. Note: A notice must be lodged under section 922H when there is a change in a matter for a relevant provider. Subdivision B—Approval of compliance schemes 921K Approval of compliance schemes (1) A monitoring body for a compliance scheme may apply to ASIC for approval of the compliance scheme. Note: A monitoring body for a compliance scheme may propose to modify the scheme (see section 921R). (2) The application must set out details of the scheme, including: (a) the name of the monitoring body for the scheme; and (b) arrangements for monitoring compliance with the Code of Ethics by relevant providers covered by the scheme; and (c) sanctions for failures to comply with the Code of Ethics by relevant providers covered by the scheme; and (d) arrangements for resolving disputes between the monitoring body and relevant providers covered by the scheme; and (e) arrangements for making complaints to the monitoring body in relation to failures to comply with, or possible failures to comply with, the Code of Ethics by relevant providers covered by the scheme. (3) The application must include evidence that the monitoring body has sufficient resources and expertise to appropriately monitor and enforce compliance with the Code of Ethics under the scheme. Approval of compliance scheme (4) ASIC may approve the scheme if it is satisfied that: (a) compliance with the Code of Ethics will be appropriately monitored and enforced under the scheme; and (b) the monitoring body has sufficient resources and expertise to appropriately monitor and enforce compliance with the Code of Ethics under the scheme. (5) ASIC may approve the scheme subject to any one or more conditions ASIC considers appropriate. (6) ASIC must, within a reasonable period, decide the application and notify the monitoring body of: (a) the decision; and (b) any condition mentioned in subsection (5). Revocation of approval, imposition of additional conditions etc. (7) ASIC may, in accordance with subsection (8), take an action specified under subsection (9) if ASIC is satisfied: (a) that compliance with the Code of Ethics is not being appropriately monitored or enforced under the scheme; or (b) that the monitoring body has not complied with: (i) section 921N (obligation to notify licensee of failure to comply with Code of Ethics); or (ii) a request under section 921Q (obligation to provide ASIC with information); or (iii) section 921T (obligation to notify ASIC of changes to monitoring body); or (iv) section 922HD (obligation to notify ASIC in relation to failures to comply with the Code of Ethics); or (c) that the monitoring body does not have sufficient resources or expertise to appropriately monitor or enforce compliance with the Code of Ethics under the scheme. (8) ASIC must not take an action specified under subsection (9) unless: (a) ASIC gives a written notice to the monitoring body: (i) providing reasons why ASIC is considering taking the action; and (ii) stating that the monitoring body has 90 business days to make submissions to ASIC, in accordance with the notice, about the possible action; and (b) ASIC has considered any submissions made by the monitoring body in accordance with the notice. (9) The following actions are specified: (a) revoking the approval of the scheme; (b) varying a condition imposed in relation to the approval of the scheme; (c) imposing an additional condition in relation to the approval of the scheme. Revocation of conditions etc. (10) ASIC may revoke or vary a condition imposed in relation to the approval of the scheme if ASIC is satisfied that compliance with the Code of Ethics will continue to be appropriately monitored and enforced under the scheme if ASIC revokes or varies the condition. (11) ASIC must, within a reasonable period, notify the monitoring body if ASIC revokes or varies a condition under subsection (10). Subdivision C—Investigations by monitoring body 921L Investigations by monitoring body Investigation into failure, or possible failure, to comply with Code of Ethics (1) The monitoring body for a compliance scheme must determine, in writing, whether a relevant provider covered by the scheme has failed to comply with the Code of Ethics if the monitoring body becomes aware of the failure, or possible failure, by the relevant provider to comply with the Code of Ethics. Notifying relevant provider of investigation (2) Within a reasonable period of becoming so aware, the monitoring body must notify the relevant provider that the monitoring body: (a) has become so aware; and (b) is to make a determination under subsection (1). Note: A monitoring body that fails to comply with this subsection may commit an offence (see subsection 921M(1)). Request for information (3) After becoming so aware, the monitoring body may request, in writing, any one or more of the following persons to provide information, documents or any other reasonable assistance to the monitoring body, within a reasonable specified period: (a) if the relevant provider is a financial services licensee—the licensee; (b) if the relevant provider is not a financial services licensee: (i) the relevant provider; or (ii) the financial services licensee on whose behalf the relevant provider is authorised to provide personal advice to retail clients in relation to relevant financial products; or (iii) if the relevant provider is a relevant provider as a result of section 916B—the authorised representative who authorised the relevant provider under that section. Note: A person who fails to comply with a request under this subsection may commit an offence (see subsection 921M(2)). Restriction on relevant provider leaving compliance scheme (4) The relevant provider must not cause a notice to be lodged under section 922H stating that another compliance scheme is to cover the relevant provider before the monitoring body has made a determination under subsection (1). Note: A relevant provider who fails to comply with this subsection may commit an offence (see subsection 921M(3)). Completion of investigation (5) The monitoring body must make the determination: (a) if the relevant provider notifies the monitoring body that the relevant provider intends to cause a notice to be lodged under section 922H stating that another compliance scheme is to cover the relevant provider—within 160 days of receiving the notice; or (b) otherwise—within a reasonable period of becoming aware of the failure, or possible failure, by the relevant provider to comply with the Code of Ethics. Note: A monitoring body that fails to comply with this subsection may commit an offence (see subsection 921M(1)). Determination by monitoring body not a legislative instrument (6) The determination is not a legislative instrument. Offence (7) A person commits an offence if: (a) the person is a monitoring body for a compliance scheme; and (b) information is disclosed to the person in accordance with subsection 70‑40(3AA) of the Tax Agent Services Act 2009; and (c) the person uses or discloses the information for a purpose other than monitoring or enforcing compliance with the Code of Ethics under the scheme. Penalty: 10 penalty units. 921M Offences relating to investigations by monitoring body Failure by monitoring body to notify relevant provider of investigation or complete investigation (1) A person commits an offence if: (a) the person is a monitoring body for a compliance scheme; and (b) the person fails to comply with subsection 921L(2) or (5). Penalty: 10 penalty units. Failure to comply with request for information (2) A person commits an offence if: (a) a request is made of the person under subsection 921L(3); and (b) the person fails to comply with the request within the period specified. Penalty: 10 penalty units. Leaving compliance scheme before investigation completed (3) A person commits an offence if: (a) the person is a relevant provider; and (b) the person is covered by a compliance scheme; and (c) the monitoring body for the scheme notifies the person that the monitoring body has become aware of a failure, or possible failure, by the person to comply with the Code of Ethics; and (d) the person contravenes subsection 921L(4). Penalty: 10 penalty units. 921N Obligation to notify licensee of failure to comply with Code of Ethics (1) A monitoring body for a compliance scheme that covers a relevant provider must notify a financial services licensee if: (a) either: (i) the monitoring body determines under subsection 921L(1) that the relevant provider has failed to comply with the Code of Ethics; or (ii) the monitoring body imposes a sanction on the relevant provider in relation to a failure to comply with the Code of Ethics; and (b) the relevant provider is authorised by the licensee to provide personal advice to retail clients in relation to relevant financial products. (2) The monitoring body must notify the licensee within 30 days after making the determination or imposing the sanction. Note 1: The approval for a compliance scheme may be revoked if the monitoring body for the scheme does not comply with this section (see subsection 921K(7)). Note 2: ASIC must be notified if a monitoring body becomes aware of a failure, or possible failure, to comply with the Code of Ethics by a relevant provider, or if a sanction is imposed on a relevant provider under a compliance scheme (see section 922HD). Subdivision D—Other provisions 921P Obligation to ensure that compliance scheme is publicly available (1) A monitoring body for a compliance scheme must ensure that the scheme is publicly available while any approval given under section 921K is in force in relation to the scheme. Offence (2) A person commits an offence if: (a) the person is a monitoring body for a compliance scheme; and (b) an approval given under section 921K is in force in relation to the scheme; and (c) the scheme is not publicly available. Penalty: 10 penalty units. 921Q Obligation to provide ASIC with information (1) ASIC may request, in writing, a monitoring body for a compliance scheme to give ASIC any specified information or documents about the compliance scheme within a reasonable specified period. (2) The monitoring body must comply with the request within the period specified. Note: The approval for a compliance scheme may be revoked if the monitoring body for the scheme does not comply with this section (see subsection 921K(7)). 921R Modification of compliance scheme (1) While an approval given under section 921K is in force in relation to a compliance scheme, the monitoring body for the scheme may, by written notice given to ASIC, propose to modify the scheme. (2) The notice must: (a) set out the text of the proposed modification; and (b) contain an explanation of the purpose of the proposed modification. Disallowance of modification (3) Within the 28‑day period beginning on the day ASIC receives the notice, ASIC may, by written notice given to the monitoring body, disallow all or a specified part of the proposed modification if ASIC is satisfied on reasonable grounds that: (a) compliance with the Code of Ethics will not be appropriately monitored or enforced under the scheme as modified; or (b) if the proposed modification is a new monitoring body for the scheme—the new monitoring body does not have sufficient resources or expertise to appropriately monitor or enforce compliance with the Code of Ethics under the scheme. Effect of disallowance (4) If ASIC disallows the proposed modification within the 28‑day period, the proposed modification does not take effect. (5) If ASIC disallows a specified part of the proposed modification within the 28‑day period: (a) the specified part does not take effect; and (b) the proposed modification without the specified part takes effect at the end of the period. No disallowance (6) Otherwise, the proposed modification takes effect at the end of the 28‑day period. 921S Obligation to review compliance scheme (1) A monitoring body for a compliance scheme must cause another person to complete a review of the scheme before the end of: (a) the 5‑year period beginning on the day ASIC approves the scheme under section 921K; and (b) each subsequent 5‑year period. (2) The other person mentioned in subsection (1) must not be: (a) an associate of the monitoring body; or (b) a person covered by the scheme; or (c) if a relevant provider covered by the scheme is authorised to provide personal advice to retail clients, on behalf of a financial services licensee, in relation to relevant financial products—the licensee; or (d) if a relevant provider covered by the scheme is a member of a professional association—the professional association. (3) As soon as reasonably practical after the review has been completed, the monitoring body must: (a) make the review publicly available; and (b) give a copy of the review to ASIC. 921T Obligation to notify ASIC of changes to monitoring body A monitoring body for a compliance scheme must notify ASIC if the monitoring body significantly reduces the resources or expertise that it uses to monitor or enforce compliance with the Code of Ethics under the scheme. Note: The approval for a compliance scheme may be revoked if the monitoring body for the scheme does not comply with this section (see subsection 921K(7)). Division 8C—The standards body Subdivision A—Functions of the standards body 921U Functions of the standards body (1) The functions of the standards body are: (a) to make the legislative instruments mentioned in subsections (2), (3) and (5); and (b) to review those instruments regularly; and (c) if an application is made under subsection 921V(1) for approval of a foreign qualification—to approve, or refuse to approve, the foreign qualification; and (d) if an exam approved for the purposes of subsection 921B(3) is to be administered by the standards body—to administer the exam; and (e) any other function prescribed by this Act. Legislative instruments (2) The standards body must, by legislative instrument: (a) do any or all of the following in one or more determinations: (i) approve bachelor or higher degrees, or equivalent qualifications, for the purposes of paragraph 921B(2)(a); (ii) approve an exam for the purposes of subsection 921B(3); (iii) set requirements for work and training for the purposes of subsection 921B(4); (iv) set requirements for continuing professional development for the purposes of subsection 921B(5) in relation to the CPD year of a financial services licensee, the period mentioned in subsection 1546E(5), or any other period determined by the standards body; (v) specify a word or expression to refer to a provisional relevant provider; and (b) make a Code of Ethics for the purposes of section 921E. (3) The standards body may, by legislative instrument, in one or more determinations, modify the operation of a provision in this Part in relation to a period determined by the standards body under subparagraph (2)(a)(iv). (4) A determination made under subsection (3) has effect according to its terms, despite any other provision of this Act. (5) The standards body may, by legislative instrument, do either or both of the following in one or more determinations: (a) provide further in relation to the requirements set out in section 921F (requirements relating to provisional relevant providers); (b) set other requirements in relation to a person who is a provisional relevant provider. Consultation (6) Before making a legislative instrument under subsection (2), (3) or (5), or when reviewing a legislative instrument under paragraph (1)(b), the standards body must consult: (a) financial services licensees; and (b) relevant providers; and (c) associations representing consumers of financial services; and (d) professional associations; and (e) ASIC and the Department; and (f) any other person or body that the standards body considers it appropriate to consult. (7) Without limiting subsection (6), the standards body is taken to have consulted the persons and bodies mentioned in that subsection if, on its website, the standards body: (a) before making a legislative instrument under subsection (2), (3) or (5): (i) makes the proposed legislative instrument, or a description of the content of the proposed legislative instrument, available; and (ii) invites those persons and bodies to comment on the proposed legislative instrument; or (b) when reviewing a legislative instrument under paragraph (1)(b)—invites those persons and bodies to comment on the legislative instrument. (8) A failure to comply with subsection (6) does not affect the validity or enforceability of a legislative instrument made under subsection (2), (3) or (5). Fees (9) The standards body may charge fees for things done in performing its functions. Note: For the treatment of legislative instruments made under this section when the declaration of a body corporate to be the standards body is revoked, see section 921Y. 921V Approval of foreign qualifications Application for approval (1) A person who has completed a foreign qualification may apply to the standards body for approval of the foreign qualification. (2) An application under subsection (1) must be in a form approved, in writing, by the standards body. Approval or refusal to approve (3) The standards body must either: (a) approve the foreign qualification in accordance with subsection (4); or (b) refuse to approve the foreign qualification. (4) The standards body may approve the foreign qualification only if: (a) the standards body is satisfied that the foreign qualification gives the person qualifications equivalent to a degree or qualification approved by the standards body for the purposes of paragraph 921B(2)(a); or (b) both of the following apply: (i) the standards body specifies one or more courses to be completed by the person under subsection (5) of this section; (ii) the person completes each of those courses. (5) The standards body may specify one or more courses for the purposes of paragraph (4)(b) only if the standards body is satisfied that (together with the person's foreign qualification) the course or courses will give the person qualifications equivalent to a degree or qualification approved by the standards body for the purposes of paragraph 921B(2)(a). When approval takes effect (6) An approval under paragraph (3)(a) comes into force: (a) if the standards body specifies one or more courses to be completed by the person under subsection (5)—when the person has completed all of those courses; or (b) otherwise—when it is given. Review of decision (7) A person may apply to the Tribunal for review of: (a) a decision by the standards body under paragraph (3)(b) to refuse to approve the person's foreign qualification; or (b) a decision by the standards body under subsection (5) to specify one or more courses to be completed by the person. Notice of reviewable decision and review rights (8) Section 1317D applies in relation to a decision mentioned in paragraph (7)(a) or (b) of this section as if: (a) the standards body were a decision maker for the purposes of section 1317D; and (b) the decision were a decision to which section 1317B applied. 921W Commencement of Code of Ethics and amendments of Code of Ethics (1) The Code of Ethics must not commence earlier than 30 days after the Code is registered under the Legislation Act 2003. (2) An amendment of the Code of Ethics must not commence earlier than 30 days after the amendment is registered under the Legislation Act 2003. Subdivision B—Declaration of the standards body 921X Minister to declare a body corporate to be the standards body (1) The Minister may (subject to subsection (2)), by notifiable instrument, declare a body corporate to be the standards body. (2) The Minister may make a declaration under subsection (1) only if the following requirements are met: (a) the body is a company limited by guarantee; (b) the Minister is satisfied that the body is likely to comply with its obligations under this Act and other laws of the Commonwealth; (c) the body's constitution provides the following: (i) the functions of the body mentioned in section 921U; (ii) the body must not be operated for profit; (iii) the body must have 9 directors; (iv) at least 3 directors (excluding the chair of the board of directors) must have experience in carrying on a financial services business or providing a financial service; (v) at least 3 directors (excluding the chair of the board of directors) must have experience in representing consumers of financial services; (vi) at least one director (excluding the chair of the board of directors) must have experience in the field of ethics; (vii) at least one director (excluding the chair of the board of directors) must have experience in designing, or the requirements of, educational courses or qualifications; (viii) a director must not hold a managerial or executive office in a professional association or association representing consumers of financial services; (ix) a director must not represent any professional association, or association representing consumers of financial services, to which the director belongs; (x) the Minister must appoint each director; (xi) a director may resign his or her appointment by giving the Minister, and the body, a written resignation; (xii) the resignation takes effect on the day it has been received by both the Minister and the body or, if a later day is specified in the resignation, on that later day. (3) The declaration must specify the time at which it takes effect. (4) The Minister must table the declaration in each House of the Parliament as soon as practicable. 921Y Minister may revoke declaration under section 921X (1) The Minister may, at any time, by notifiable instrument, revoke a declaration under section 921X. (2) The revocation must specify: (a) the time at which it takes effect; and (b) which legislative instruments made by the standards body under subsection 921U(2), (3) or (5) continue in force, and which are taken to be revoked at that time; and (c) which approvals (if any) given by the standards body under paragraph 921V(3)(a) continue in force (or are to come into and continue in force), and which are taken to be revoked at that time. (3) A revocation under subsection (1) that specifies that a legislative instrument, or an approval, is taken to be revoked at a particular time has effect according to its terms. Tabling of revocation (4) The Minister must table the revocation in each House of the Parliament as soon as practicable. Performance by Minister of certain functions of standards body when no declaration is in force (5) If no declaration under section 921X is in force at a particular time, the Minister may make a legislative instrument or decision as if the Minister were performing the functions of the standards body under paragraph 921U(1)(a) or (c). Instruments and decisions made by Minister etc. (6) If a declaration under section 921X comes into force after the Minister has made a legislative instrument or decision for the purposes of subsection (5) of this section, the standards body may vary or revoke the legislative instrument or decision. Relationship with Acts Interpretation Act 1901 (7) This section does not limit the operation of subsection 33(3) of the Acts Interpretation Act 1901. Subdivision C—Other provisions relating to the standards body 921Z Modification of the standards body's constitution (1) As soon as practicable after a significant modification of the standards body's constitution takes effect, the standards body must notify the Minister in writing of the modification. (2) The notice must: (a) set out the text of the modification; and (b) specify the date on which the modification takes effect; and (c) contain an explanation of the purpose of the modification. (3) If no notice is lodged with the Minister within 21 days after the modification takes effect, the modification ceases to have effect. (4) A notice made under this section is not a legislative instrument. 921ZA Disallowance of modifications of the standards body's constitution (1) Within 28 days after receiving a notice under section 921Z, the Minister may disallow all or a specified part of the modification of the standards body's constitution. (2) As soon as practicable after all or part of a modification is disallowed, the Minister must give notice of the disallowance to the standards body. The modification ceases to have effect, to the extent of the disallowance, when the standards body receives the notice. 921ZB Minister may direct the standards body to do certain things (1) The Minister may give a written direction to the standards body if the Minister considers that the standards body is not complying with its obligations under this Act or under any arrangement it has with the Commonwealth. (2) The standards body must comply with the direction. (3) The Minister may, at any time, vary or revoke a direction. (4) Despite paragraph (b) in the definition of director in section 9, the Minister is not a director of the standards body. 921ZC Annual report As soon as practicable after the end of a financial year, the standards body must: (a) publish on its website the annual report for the financial year prepared under Chapter 2M; and (b) give a copy of the report to the Minister. 13 Before section 922A Insert: Subdivision A—Registers generally 14 At the end of subsection 922A(2) Add: Note: The Register of Relevant Providers is maintained under Subdivision C of this Division. 15 Section 922B Repeal the section, substitute: 922B Fees for searching registers The regulations may prescribe the fees that a person must pay to ASIC to do the things mentioned in section 1274A in relation to a register mentioned in section 922A or the Register of Relevant Providers. Note: Section 1274A provides that ASIC may permit a person to search certain registers kept by ASIC for prescribed information. 16 At the end of Division 9 of Part 7.6 Add: Subdivision B—Notice requirements relating to the Register of Relevant Providers 922D Obligation to notify ASIC about a person who becomes a relevant provider Notice to include details about relevant provider (1) A notice must be lodged under this section, in accordance with section 922L, if a person becomes a relevant provider. Note: A financial services licensee required to lodge a notice under this section may obtain information from a relevant provider under section 922N. Content of notice (2) The notice must include: (a) for a relevant provider who is a financial services licensee—the information in section 922E; or (b) for a relevant provider who is not a financial services licensee—the information in section 922F. 922E Information about a relevant provider who is a financial services licensee (1) For the purposes of paragraph 922D(2)(a), the notice must include the following: (a) the relevant provider's name; (b) the address of the relevant provider's principal place of business; (c) the licence number given to the relevant provider under subsection 913C(1); (d) the year in which the relevant provider first provided personal advice to retail clients in relation to relevant financial products in accordance with the law (including the law of a State or Territory); (e) if applicable, the ABN of the relevant provider; (f) information about both of the following: (i) the relevant financial products in relation to which the relevant provider is authorised to provide personal advice to retail clients; (ii) whether the relevant provider is authorised to provide class of product advice in relation to some or all of those products; (g) the recent advising history of the relevant provider for the 5 years ending immediately before the time the notice is lodged; (h) information about both of the following: (i) the educational qualifications of, and any training courses completed by, the relevant provider, to the extent that the qualifications and training courses are relevant to the provision of financial services; (ii) the relevant provider's membership (if any) of a professional association if an approval is in force under section 921K in relation to a compliance scheme monitored and enforced by the association; (i) the name of the compliance scheme that is to cover the relevant provider. Note: For the meaning of recent advising history, see section 922G. Educational qualifications and memberships (2) For the purposes of subparagraph (1)(h)(i), if a relevant provider has more than 5 educational qualifications or has completed more than 5 training courses, the notice must include the 5 qualifications or training courses that the person lodging the notice believes, on reasonable grounds, are most relevant to the provision of financial services. 922F Information about a relevant provider who is not a financial services licensee (1) For the purposes of paragraph 922D(2)(b), the notice must include the following: (a) the relevant provider's name; (b) the address of the relevant provider's principal place of business; (c) the relevant provider's date and place of birth; (d) the name of the financial services licensee on whose behalf the relevant provider is authorised to provide personal advice to retail clients in relation to relevant financial products; (e) the licence number given to that licensee under subsection 913C(1); (f) if the relevant provider is a provisional relevant provider—the fact that the relevant provider is a provisional relevant provider; (g) if the relevant provider is a provisional relevant provider—the day the relevant provider began undertaking work and training in accordance with subsection 921B(4); (h) except in relation to provisional relevant providers—the year in which the relevant provider first provided personal advice to retail clients in relation to relevant financial products in accordance with the law (including the law of a State or Territory); (i) if the relevant provider is a relevant provider as a result of section 916B—each of the following: (i) the name of the authorised representative who authorised the relevant provider under that section; (ii) the number allocated to the authorised representative by ASIC; (j) if applicable, the ABN of any of the following: (i) the relevant provider; (ii) the licensee referred to in paragraph (d); (iii) the authorised representative referred to in paragraph (i); (k) details of both of the following: (i) the relevant financial products in relation to which the relevant provider is authorised to provide personal advice to retail clients; (ii) whether the relevant provider is authorised to provide class of product advice in relation to some or all of those products; (l) the recent advising history of the relevant provider for the 5 years ending immediately before the time the notice is lodged; (m) information about both of the following: (i) the educational qualifications of, and any training courses completed by, the relevant provider, to the extent that the qualifications and training courses are relevant to the provision of financial services; (ii) the relevant provider's membership (if any) of a professional association if an approval is in force under section 921K in relation to a compliance scheme monitored and enforced by the association; (n) the name of the compliance scheme that is to cover the relevant provider. Note: For the meaning of recent advising history, see section 922G. Educational qualifications and memberships (2) For the purposes of subparagraph (1)(m)(i), if a relevant provider has more than 5 educational qualifications or has completed more than 5 training courses, the notice must include the 5 qualifications or training courses that the person lodging the notice believes, on reasonable grounds, are most relevant to the provision of financial services. Information already registered (3) The notice does not need to include the information referred to in paragraph (1)(h), (l) or (m) if: (a) the person required under subsection 922L(4) to cause the notice to be lodged believes on reasonable grounds that the information has previously been lodged; or (b) the information is already entered on the Register of Relevant Providers. Provisional relevant providers (4) The notice does not need to include the information referred to in paragraph (1)(k) in relation to a provisional relevant provider if that information is not known at the time the notice relating to the provisional relevant provider is lodged by the licensee. Note: A notice must be lodged under section 922H once this information is known. 922G Meaning of recent advising history The recent advising history of a relevant provider is the following information: (a) for a relevant provider who is or was a financial services licensee authorised to provide personal advice to retail clients in relation to relevant financial products—each period during which the relevant provider was such a licensee; (b) for a relevant provider who is or was authorised to provide personal advice to retail clients, on behalf of one or more financial services licensees, in relation to relevant financial products—the following information: (i) the name of each licensee; (ii) if the relevant provider is or was a relevant provider as a result of section 916B—the name of each authorised representative who authorised the relevant provider under that section; (iii) each period during which the relevant provider was authorised by each licensee or each authorised representative to provide such advice. Note: If a relevant provider is covered by paragraphs (a) and (b) of this section, the relevant provider's recent advising history includes all the information required under those paragraphs. 922H Ongoing obligation to notify ASIC when there is a change in a matter for a relevant provider (1) A notice must be lodged under this section, in accordance with section 922L, if: (a) there is a change in a matter, particulars of which are entered for a relevant provider in the Register of Relevant Providers (other than a change that is a direct consequence of an act by ASIC); or (b) both of the following apply: (i) a notice is lodged under section 922D in relation to a relevant provider by a financial services licensee without including the information referred to in paragraph 922F(1)(k); (ii) the information becomes known to the licensee after the notice is lodged. Note: For paragraph (1)(a) of this section, an example of a change in a matter would be a person ceasing to be a relevant provider. Another example would be a change in the compliance scheme that covers a relevant provider. (2) The notice must include the following information: (a) the new particulars or information to be entered in the Register; (b) the relevant provider's name; (c) if applicable, the number given to the relevant provider under section 922R. 922HA Obligation to notify ASIC of financial services licensee's CPD year (1) A notice must be lodged under this subsection, in accordance with section 922L, if ASIC grants an applicant an Australian financial services licence that covers the provision of personal advice to retail clients in relation to relevant financial products. (2) A notice lodged under subsection (1) must include the day on which the licensee's CPD year is to begin. (3) A notice must be lodged under this subsection, in accordance with section 922L, if a financial services licensee: (a) has previously lodged a notice under subsection (1) or this subsection specifying a particular day of the year; and (b) decides that the licensee's CPD year is to begin on another day of the year; and (c) has not lodged a notice under subsection (1) or this subsection in the 12‑month period preceding that decision. (4) A notice lodged under subsection (3) must include the day on which the licensee's CPD year is to begin. 922HB Obligation to notify ASIC of non‑compliance with continuing professional development standard (1) A notice must be lodged under this section, in accordance with section 922L, in relation to a person if, at the end of a financial services licensee's CPD year: (a) the person: (i) is the licensee; or (ii) is authorised to provide personal advice to retail clients, on behalf of the licensee, in relation to relevant financial products; and (b) the person is a relevant provider; and (c) the relevant provider has not complied with section 921D during the licensee's CPD year. Note 1: A financial services licensee may obtain information from a relevant provider under section 922N for the purposes of determining whether to lodge a notice under this section. Note 2: Subsection 921D(1) requires certain relevant providers to meet the continuing professional development standard in subsection 921B(5). (2) The notice must state that the relevant provider has not complied with section 921D during the licensee's CPD year. 922HC Requirement to retain information (1) A financial services licensee must retain evidence of the continuing professional development undertaken during the licensee's CPD year by: (a) if the licensee is a relevant provider—the licensee; and (b) if a relevant provider is authorised to provide personal advice to retail clients, on behalf of the licensee, in relation to relevant financial products—the relevant provider. (2) The evidence must be retained for 12 months after the end of the CPD year. Offence (3) A person commits an offence if: (a) the person is required to retain evidence under this section; and (b) the person fails to retain the evidence in accordance with this section. Penalty: 50 penalty units. 922HD Obligation to notify ASIC in relation to failures to comply with the Code of Ethics (1) A notice must be lodged under this subsection, in accordance with section 922L, if: (a) a monitoring body for a compliance scheme determines under subsection 921L(1) that a relevant provider covered by the scheme has failed to comply with the Code of Ethics; or (b) a sanction is imposed on a relevant provider covered by a compliance scheme in relation to a failure to comply with the Code of Ethics by the relevant provider. (2) The notice must include the following information: (a) if the relevant provider is a financial services licensee—the name of the licensee; (b) if the relevant provider is not a financial services licensee: (i) the name of the relevant provider; and (ii) the name of the financial services licensee on whose behalf the relevant provider is authorised to provide personal advice to retail clients in relation to relevant financial products; (c) if paragraph (1)(a) applies—details of the failure to comply; (d) if paragraph (1)(b) applies—details of the sanction imposed. (3) If, in relation to the same failure to comply, the events mentioned in paragraphs (1)(a) and (b) occur within 30 business days of one another: (a) a single notice may be lodged under subsection (1) within 30 business days of the later of those events; and (b) only one notice is taken to be required to be caused to be lodged for the purposes of subsection 922M(1). 922J Obligation to notify ASIC about a person who starts to have control of a body corporate licensee (1) A notice must be lodged under this section, in accordance with section 922L, if a person starts to have control of a body corporate licensee. Note: Subsection 922P(3) provides that a notice is not required to be lodged when a person starts and then ceases to have control of a body corporate licensee within 30 business days. (2) The notice must include the following information: (a) the name of the licensee; (b) the licence number given to the licensee under subsection 913C(1); (c) the name of the person who starts to have control of the licensee; (d) the day the person starts to have control of the licensee. 922K Obligation to notify ASIC about a person who ceases to have control of a body corporate licensee (1) A notice must be lodged under this section, in accordance with section 922L, if a person ceases to have control of a body corporate licensee. Note: Subsection 922P(3) provides that a notice is not required to be lodged when a person starts and then ceases to have control of a body corporate licensee within 30 business days. (2) The notice must include the following information: (a) the name of the licensee; (b) the licence number given to the licensee under subsection 913C(1); (c) the name of the person who ceases to have control of the licensee; (d) the day the person ceases to have control of the licensee. 922L Requirement for notice to be lodged Notice in prescribed form (1) A notice under a notice provision must be in the prescribed form. Note 1: Under section 350, a document that this Act requires to be lodged with ASIC in a prescribed form must: (a) if a form for the document is prescribed in the regulations—be in that prescribed form; and (b) if a form for the document is not prescribed in the regulations but ASIC has approved a form for the document—be in that approved form. Note 2: The prescribed form may deal with information that is required under more than one section of this Act. When notice must be lodged (2) A notice under a notice provision must be lodged within 30 business days of the following day: (a) if the notice is lodged under subsection 922HA(1)—the day ASIC grants the Australian financial services licence mentioned in that subsection; (b) if the notice is lodged under subsection 922HA(3)—the day the financial services licensee mentioned in that subsection decides that the licensee's CPD year is to begin on another day of the year; (c) if the notice is lodged under subsection 922HB(1)—the last day of the CPD year of the financial services licensee mentioned in that subsection; (d) if the notice is lodged under subsection 922HD(1)—(subject to subsection 922HD(3)) the day the monitoring body mentioned in subsection 922HD(1) determines under subsection 921L(1) that a relevant provider has failed to comply with the Code of Ethics or a sanction is imposed; (e) if the notice is lodged under any other notice provision—the day of the event mentioned in subsection (1) of the notice provision. (3) The information contained in the notice must be accurate as at the day mentioned in paragraph (2)(a), (b), (c), (d) or (e). Who must cause notice to be lodged (4) The following person must cause a notice under section 922D, 922H or 922HB to be lodged in relation to a relevant provider: (a) if the relevant provider is a financial services licensee—the licensee; (b) otherwise—the financial services licensee on whose behalf the relevant provider is authorised to provide personal advice to retail clients in relation to relevant financial products. (5) A notice under subsection 922HA(1) or (3) must be lodged by the financial services licensee mentioned in that section. (6) A notice under section 922HD must be lodged by the monitoring body mentioned in subsection 922HD(1). (7) A notice under section 922J or 922K relating to a person who starts or ceases to have control of a body corporate licensee must be lodged by the licensee. 922M Offence for failing to comply with obligation to notify ASIC (1) A person commits an offence if: (a) the person is required to cause a notice to be lodged under a notice provision; and (b) the person fails to cause the notice to be lodged in accordance with that provision. Note: A notice must be lodged in accordance with section 922L in order to be lodged in accordance with a notice provision (see subsection (1) of the notice provision). Penalty: 50 penalty units. (2) However, subsection (1) does not apply if: (a) the person fails to cause the notice to be lodged in accordance with section 922D; and (b) the only re