At issue is the Financial Markets (Conduct of Institutions) Amendment Act, or COFI.

This law was passed earlier this year and joins two other statutes, the Financial Services Legislation Amendment Act (FSLAA) and the Credit Contracts and Consumer Finance Act (CCCFA), in extending controls to most major aspects of the finance industry.

After initial controversy, an advanced level of regulation under COFI of intermediaries such as advisers was wound back, but not removed.

As a result, regulatory returns will have to be filed to the Financial Markets Authority (FMA) in respect of any regulated financial advice provided to retail clients.

The FMA says these will have to be provided on a regular basis so the information they contain can be used to monitor licensees' continuing capacity to effectively perform licensed financial services.

The latest proposal outlines licensee's obligations regarding their regulatory returns and seeks their response.

This initial proposal applies only to holders of Class Three FAP licences, which offer the broadest range of flexibility to engage other entities to help them do their job.

Proposals for Class One and Class Two licence holders will come later.

In proposing a series of regulatory returns, the FMA stresses that these are needed to ensure that it has up-to-date information about FAPs, as conditions might have changed since a full FAP licence was granted.

This information would allow the FMA to consider whether licence holders continue to meet eligibility criteria and market service licence obligations.

It would also help the FMA to understand the entire industry in more detail.

The FMA has sought people's opinions on these proposals and has also sought information as to whether other matters should be brought into the mix.

The regulatory returns are proposed to be filed annually. The FMA wants a response from the industry to this timeframe.   It also wants to know whether the sought-after information is appropriate and well defined, and also whether compliance would impose system changes or costs on the FAP licensee.

And it wants the industry as a whole to benefit from public information while protecting privacy and confidential data that could be commercially sensitive. 

The full proposal can be found here: http://shorturl.at/dUW47