Treasury has made some amendments to the design and distributions obligations (DDO) regime that is set to commence on October 5, taking into account feedback from the advice sector.

One of the changes will see the removal of a requirement for distributors to report whether they have received a complaint or acquired information requested by the issuer, including where there are nil complaints or nil information.

Distributors will still be required to report to issuers, complaints and other requested information that they receive, assisting issuers to assess whether their product governance arrangements are appropriate and their products are meeting the needs of consumers, Treasury said.

It says for many of these amendments, the Australian Securities and Investments Commission (ASIC) will provide temporary relief that gives effect to the government’s policy intention in the interim period before the legislative changes are made.

The Financial Planning Association (FPA) has welcomed the move.

“Given this would have been the vast majority of reporting required by financial planners in relation to target market determinations, this administrative relief by the government is a welcome outcome for the financial planning profession,” FPA said.

But FPA still has concerns in other areas about the DDO regime. It says there is lack of clarity or definition from product manufacturers in relation to significant dealing reporting.

“The FPA encourages ASIC to take action against products who have failed to clearly define what a significant dealing is in relation to their specific product,” FPA said.

Treasury will consult with stakeholders in due course about the changes, including the one that seeks to clarify that where a product disclosure statement is given in the course of providing personal advice as required by law, this conduct is within the scope of excluded conduct, consistent with the original intention of excluded conduct.

ASIC has released additional information for advice licensees and financial advisers who are authorised representatives to help them prepare for the commencement of the DDO regime.

The corporate regulator says it strongly recommends that advice licensees and financial advisers who are authorised representatives familiarise themselves with regulatory guide RG 274 for more detailed guidance on many of the issues covered in information sheet INFO 264.

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