"I'm confident that this approach will ensure that we have the strength of central supervision, without losing the experience and knowledge of industry participants," Dalziel says. "It will help ensure that the Securities Commission can act as both the statutory enforcer and the professional regulator."

The Finance and Expenditure Select Committee second interim report on the Financial Advisers' Bill also suggests a two-level approach to imposing obligations on financial advisers that are appropriate to the complexity of the financial product involved, and allows for institutional certification to ensure that the regulation is proportionate to the risks associated with the financial advice given, Dalziel said.

"The industry and officials have been grappling with the problem of defining who should be captured by the new rules regulating financial advisers. By focusing on the actual product rather than financial decisions or occupations we are able to provide certainty about who is covered by the Bill."

The committee is proposing two levels of financial advisory services be established in the bill, each imposing a different level of obligation.

It is also grappling with the thorny issue of whether the commission can certify financial institutions to manage advisers offering "simple products".

"This is intended to cover bank tellers and insurance sales staff and the like who are selling basic products offered by the bank, insurance company, credit union or other financial institution and where there is little or no risk to consumers," Dalziel said.

Under these proposals authorised financial advisers (selling complex Category 1 products) employed by a Certified Financial Institution would still have to meet their individual obligations.