Codes of conduct for financial services bodies must meet the opt-in objectives of the Future of Financial Advice (FOFA) legislation to win approval, according to the Australian Securities and Investments Commission (ASIC).

“They must promote client engagement and ensure clients do not pay ongoing financial advice fees where they are receiving little or no service,” Commissioner Peter Kell said.

This will help licensees and authorised representatives decide if they want to meet the opt-in requirements, the regulator says in its new guidelines on the approval of codes.

The guidelines also confirm that ASIC will not approve codes for single entities, thereby removing the need for dealer groups or individual advisers to apply.

The regulator has included a checklist of required code content that will allow advisers to avoid the opt-in requirements. One stipulation is for organisations to maintain a public register of members covered by the code.

ASIC will work with code applicants to deal with implementation issues, Mr Kell says.

“We encourage [them] to engage with us early in the process and, as needed, we will give further guidance on our FOFA webpage.

“Effective co-operation between all parties will be necessary for an approved code to work as an effective alternative to complying with the law.”

For more details, see Wednesday’s edition of Life+Health insuranceNEWS.com.au.