Chief executive Katrina Shanks says she is “pleased overall” with the way the Financial Markets (Conduct of Institutions) Amendment Act (CoFI) will affect advisers.

CoFI will impose a code of conduct on banks, insurers and non-bank deposit takers. Last week the Financial Markets Authority (FMA) released proposed guidelines for how CoFI will be imposed on advisers.

Shanks is pleased with what she has read about its methods. “We like the emphasis on the risk-based approach towards distribution networks which carry a known risk,” she said.

This was a reference to a section in the proposed guidance where the FMA said costs could be held down for both financial institutions and advisers themselves if they tailored their work to the level of risk that they face.

Shanks was also pleased with another development. There had been fears that CoFI would require firms of intermediaries to have annual external audits, or to commission independent assurance reports, which could be costly.

But the FMA guidance says these will not be mandated.

“There is also a clear message within the guidelines themselves in terms of the training requirements. The guidelines themselves talk about relying on competency, knowledge and skill, which we think is really positive.”

The CoFI law had a chequered history - it was accused of legislative overkill from within the financial sector, and was sometimes called a needless replication of the FAP programme.

The National Party called it a solution looking for a problem. But the party has not pledged to repeal it – unlike the CCCFA rules.

But the outcome so far is a long way removed from the fears that were expressed in the early days, possibly because of strong lobbying from Shanks' group and others.

“We were very strong in our submissions about the unintended consequences of CoFI,” she said.

One of the issues here would have been a needless overlap between CoFI and the requirements of the Financial Services Legislation Amendment Act (FSLAA), which set up the FAP regime.

“I think this guidance has recognised the two different legislative regimes, CoFI and FSLAA, will be able to work side by side instead of overlapping.”