Do you list the CAR and the staff or just the CAR on the ASIC register

[licencefx]

If a staff member of a CAR, gives advice on behalf of the CAR, on the SOA it lists the CAR giving the advice etc and provided the person also has their RG146 Quals, does that person needed to be listed on the ASIC register, or just the CAR?

[Andrew Ham]

Hello,

Thank you for your question.

It is important to be clear about the separate roles of the Register of Authorised Representatives and the Register of Financial Advisers.

If the staff member of the CAR is sub-authorised under the CAR Agreement to provide financial product advice on behalf of the licensee, then that person is also an authorised representative of the licensee.  In this case, there are two registers these individual financial advisers that are individuals must be registered on; the Financial Adviser Register, and if they are appointed under the CAR Agreement, as sub-authorised representatives also on the separate Authorised Representative Register.

The CAR, or the licensee on its behalf, must notify ASIC when it authorises any financial adviser to give financial product advice, within 15 business days of the appointment.  These “sub-authorised” advisers are authorised representatives for the purpose of the Act just as the CAR is.  This can be completed through ASIC Connect by providing adviser details to be uploaded onto the Financial Adviser Register.

Financial adviser’s details must also be kept up-to-date, as failing to do so will be a breach of the licensee’s obligations.

The adviser appointed as a sub-authorised representative might, nevertheless, issue SOAs in the name of the CAR.  This does not affect their registration obligations.  There are, however, circumstances where notification is not required.  Under s916F of the Corporations Act 2001, there is no obligation to notify ASIC of the appointment of financial advisers if the following conditions are met:

• They are employees of the authorised representative and included in a specified class of individuals that the licensee has consented to authorise under s916B(5);
• The financial services they are authorised to provide are limited to:

— general advice on and/or dealing in general insurance products, cash management trust interests or basic deposit products and related non-cash payment facilities (see reg 7.6.04A of the Corporations Regulations 2001); and/or

— personal advice on basic deposit products and related non-cash payment facilities; and

• The authorised representative provides information about them and their authorisation when requested.

Please feel free to contact our Financial Services Team for further information.

Authors: Andrew Ham (Senior Lawyer) and Greta Walters (Legal Clerk)

 

[David]

thankyou for your great reply.

You mention the sub auth rep issuing SOAs in the name of the CAR does that mean that if the advice issued in the CARs name then only the CAR details and the Licencees need to be on the SOA and the individuals does not?

The individials will be listed on the ASIC registers you mention  But not anywhere in the SOA?

[David Court]

Hi David,

Thanks for your question.

Under the Corporations Act 2001 (“the Act”) the ‘providing entity’ of a Statement of Advice can be a licensee, a Corporate Authorised Representative (“CAR”) or an individual authorised representative.  Where an authorised representative (whether corporate or individual) provides personal financial product advice, the Statement of Advice must include a statement:

• setting out the name, contact details and AFS licence number of the authorising licensee; and

• a statement that the providing entity of the advice is the authorised representative of the licensee.

Generally, the inclusion of the name and contact details of the licensee and the providing entity, is required. However, in practice, if advice is prepared by the individual authorised representative on behalf of a CAR, the details of the licensee, the CAR, and the individual authorised representative who prepared the SOA are generally included, with either the CAR or individual authorised representative identified as the providing entity.

It is important to keep in mind the requirement for clear, concise and effective disclosure, and the serious penalties that apply if this requirement is not met.

For an example Statement of Advice please see ASIC’s Regulatory Guide 90.

Please feel free to contact our Financial Services Team for further assistance.

Authors: David Court (Partner), Jesse Vermiglio (Senior Lawyer) and Greta Walters (Legal Clerk)

 

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