Financial Advice New Zealand (FANZ) has welcomed draft regulations around new disclosure requirements for financial advisers, but says they need fine-tuning.

As part of the changes under the new financial advice regime, advisers must meet certain disclosure obligations when providing advice to ensure they are making informed decisions, as well as keep a record of each disclosure made.

The Ministry of Business, Innovation and Employment released an exposure draft of regulations governing these obligations for industry feedback last week.

CEO Katrina Shanks says FANZ “generally supports the proposed requirements around record-keeping regarding disclosure made to clients”.

“In our view some of them need further consideration and development, and we will be providing feedback on them,” she said.

Under the changes, advisers have to disclose their licence and duties, the advice and products they can advise on, fees and costs, commissions and incentives, how they handle complaints, and their previous disciplinary history including certain convictions, before giving the advice.

The disclosure records will make it easier for the Financial Markets Authority to police advisers.

The new regime will come into effect in June next year.