• Changing the focus of the regulation to financial products, rather than financial advice, with two categories of financial product;
• Category one would need to be authorised by the Securities Commission and would include advice on "complex securities or investment broking and savings or investment planning;
• Category two would not require advisers to be authorised, but they would have to comply with the basic disclosure and conduct requirements already outlined in the bill.
• Institutions which meet certain standards could be certified by the Securities Commission and these institutions would be responsible for advice offered by their staff on simple products.

"The idea of having a commissioner of financial advisers is a good one: we just don't think it should be on the Securities Commission," he told Good Returns.

"We're very concerned about the prospect of having the Securities Commission being the policeman, the setter of standards, the court of appeal…the whole process in fact.

"That doesn't mean we have concerns about the commission itself: it is just that the principle of natural justice suggests you should have the disciplinary body separate from the rule setting and investigative body."

FAANZ also believes the focus of the regulation "should be advice based rather than product based."

"The categories they have come up with…. well, category two, the more lightly regulated one, would include some of the Blue Chip products. It is not easy to distinguish between which sort of products require higher protection and which do not."

The group also has "strong reservations" about the proposal for certifying institutions.