The below summary includes hyperlinks to all relevant documents and training.

Product Design and Distribution Obligations

Effective 5 October 2021, Product Design and Distribution Obligations apply to product issuers and product distributors.

The licensee and advisers are distributors of financial products to retail clients and have obligations to ensure that financial products are only provided to consumers for whom they are suitable as defined in the Target Market Determination (TMD) prepared by product issuers.

Advisers must:

  • Ensure products they distribute have a TMD
  • Consider the TMD when providing personal advice and complete information in Compass (refer to the licensee standard)
  • Take reasonable steps to ensure distribution is consistent with the TMD when providing execution only services or general advice
  • Report significant dealings outside the TMD to the licensee immediately (refer to the licensee standard)
  • Report complaints about the product to the licensee by completing the complaints section in Compass (refer to the licensee standard)

Licensees must:

  • Notify product issuers of significant dealings outside the TMD within 10 business days
  • Collect the information specified in the TMD and report it to the product issuer
  • Notify product issuers of complaints relating to the product within 10 business days at the end of the reporting period

The following are available on Centrepoint Connect to assist you:

Internal Dispute Resolution

Effective 5 October 2021, Regulatory Guide 271 Internal Dispute Resolution (IDR) takes effect. The new standards and requirements aim to improve the timeliness and efficiency of complaint handling by financial firms.

Licensees must have a publicly available, readily accessible complaints policy and an internal complaint management procedure.

Licensees and advisers must record all complaints received, even those resolved immediately.

Licensees and advisers must acknowledge complaints within 1 business day and IDR responses provided no later than 30 calendar days after receiving the complaint.

You should:

  • Ensure you use the new FSG with the updated IDR response times from 5 October 2021.
  • Refer consumers to the Complaints Policy on the Centrepoint Alliance website if a client requests a copy.
  • Ensure you acknowledge complaints immediately and record all complaints in Compass
  • Notify the licensee if you are unable to resolve a complaint immediately or the client request a written response.

The following are available on Centrepoint Connect:

The following are available on the Centrepoint Alliance website:

Breach Reporting

Effective 1 October 2021, new breach reporting obligations commence, designed to clarify which breaches are significant and reportable.

Licensees must lodge reports about reportable situations to ASIC within 30 calendar days. Certain breaches and investigations are deemed to be automatically reportable.

The following are available on Centrepoint Connect:

Information Sharing and Reference Checking Protocol

Effective 1 October 2021, new legislation requiring licensees to engage in reference checking and information sharing about the history of financial advisers and mortgage brokers commences.

Licensees must take reasonable steps to obtain a reference about a prospective representative from the current and/or former licensees (AFSL & ACL) who employed or authorised a person who is applying to be either a mortgage broker or financial adviser.

Compass Fee Arrangements and Advice Document Enhancements

Effective from 27 September 2021, the enhancements were made to support different fee arrangements.

Advisers can now capture details and manage clients with fixed term arrangements in Compass.

The SoA and advice builder wizard changes better support a variety of fee arrangements with:

  • The Further Advice and Services section replacing the Ongoing Review section of the SoA
  • New language in the Costs of Our Advice section with Ongoing Remuneration now called Further Remuneration

Other enhancements include:

  • Changes to the output for the incomplete and inaccurate information warning and scope of advice designed to minimise risk of inadvertent breaches
  • A new Better Position Statement where you will be able to state how your advice is likely to leave the client in a better position.

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