The code is under development, with a view to being approved by Commerce Minister Kris Faafoi either just before Christmas or early in the new year.

Much of the draft code is similar to that which already applied to AFAs, such as acting with integrity and ensuring the suitability of advice.

A key point of contention through its development has been its general competence, knowledge and skill requirements. These will now apply to all financial advisers, not just AFAs.

RFAs currently have no qualification requirement.

The code said the New Zealand Certificate in Financial Services (Level 5) or the National Certificate in Financial Services (Financial Advice) (Level 5) provided the minimum standards expected.

Individuals can demonstrate they are at that level by being AFAs before the code commences, or having the qualification. They will be required to have completed the relevant strand of the certificate for their type of financial advice. It has previously been suggested that financial planning might require a degree but the draft code does not include that requirement.

Instead, the group notes it intends to consult in the future on whether higher qualifications should be required to demonstrate particular competence, knowledge, and skill for designing an investment plan for new entrants to the sector after a future date.

Entities will be able to meet the standard by giving advice only through individuals who can show they do, or having procedures, systems and expertise that together mean the entity has the equivalent capability.

Nominated representatives will need to complete the learning outcomes specified for their role by their financial provider to mean that together with the procedures, systems and expertise of the financial advice provider, the nominated representative has the capabilities equivalent to those of an individual who alone has achieved the general qualification outcomes.

The working group developing the code noted it would review the latest version of the level five qualification when the draft code was submitted to the minister for approval, and if satisfied with it, specify that version in the code.

"A person seeking to demonstrate that an alternative qualification satisfies the standard, should be able to demonstrate equivalence in an objective, measurable and independently verifiable manner.

"Overseas qualifications should be accompanied by demonstration of an up-to-date understanding of the regulatory framework for financial advice in New Zealand. Older relevant qualifications may be used to demonstrate achievement of qualification outcomes provided the person can demonstrate how they have maintained competence, knowledge, and skill since attaining the qualification, including having an up-to-date understanding of the regulatory framework for financial advice in New Zealand."

Working group chair Angus Dale-Jones said it had received a lot of feedback on the need to set robust and achievable competence standards.

“We have also taken a principles-based approach to ensure the code is flexible and works for all the different types of businesses that provide financial advice, including small firms," he said.

“We’re now seeking feedback on the draft code, and want to hear from people about what they think of the proposed standards and how they will work in practice."

The code is technology-neutral and will apply to roboadvice, as well as financial advice given by people. It sets out 12 proposed standards and supporting commentary. It includes requirements to treat clients fairly and act in their interests, act with integrity, manage conflicts of interest, take steps to ensure the client understands the advice, give advice that is suitable for the client and meet standards of competence, knowledge and skill.

The code will sit within a wider regulatory regime that will include statutory duties, disclosure requirements and licensing. These changes are being introduced through the Financial Services Legislation Amendment Bill.

Further information, including the draft code and link to the online survey is available at www.mbie.govt.nz/cwg.