PARI.IAI\IENT OF AUSTRAUA HOIJSE Of.

' REPRESENTATIVES
Media release
Federal Member for Fairfax
Federal Leader of the Palmer United Party
Clive Palmer MP
Palmer United Protects The Rights of all Australians
A range of new consumer protection measures proposed by the Palmer United Party
were agreed to by the Federal Government today in a major win for everyday
Australian investors and responsible financial advisors.
Following discussions with the Palmer United Party over the Future of Financial
Advice (FoFA) laws, The Minister for Finance, Mathias Cormann, on behalf of the
Government, has tabled a letter in the Senate today stating that the Government will
make further regulations within 90 days to ensure key changes to improve
affordable, high quality financial advice, removing unnecessary and costly red tape,
while protecting investors.
Palmer United Party federal leader and Member for Fairfax, Clive Palmer, said his
party could only support financial advice laws that were "fair for all Australians".
The government has agreed to Palmer United's strengthened consumer protection
provided by financial advisers to their clients and signed off by both.
These measures which include:
That the adviser is required to act in the best interests of their client and
prioritise their clients interests ahead of their own.
That any fees are to be disclosed and that the adviser will provide a fee
disclosure statement annually.
That a client has the right to return financial products under 14-day cooling-off
period.
That the client has the right to change his or her instructions to their adviser, if
for example they experience a change in their circumstances.
The Government has also agreed to establish an enhanced public register of
financial advisers that includes the adviser's credentials and status within the
industry.
"The Palmer United Party will only support FoFA regulations that are unambiguous,
transparent and clear," Mr Palmer said.
"It appears that a common-sense approach has prevailed following a successful
conversation with the Minister and the diligent work of the Palmer United Senate
team which always has the best interests of Australians at heart," Mr Palmer said.
"We cannot have a FoFA framework that puts ordinary Australian investors at risk,
where their retirement plans could be potentially ruined by unscrupulous financial
advisors putting their own interests first," Mr Palmer said.
"Our solution for Australians is not the Liberal way or the Labor way, but the right
way."
"We must have a system where the best interests of the clients are taken into
account," Mr Palmer said.
ENDS
For further information please call Andrew Crook 0419 788 431
Mr Clive F Pahner MP
Minister for Finance
Acting Assistant Treasurer
Leader of the Pahner United Party
Member for Fairfax
Parliament House
CANBERRA ACT 2600
Thank you for your time yesterday and today and the very constructive discussions with you on behalf
of the Palmer United Party about the Government's improvements to our financial advice laws.
As we discussed, the Government's intention is to improve access to affordable, high quality financial
advice by removing unnecessary and costly red tape, while maintaining all tl1e important consumer
protections that matter for consumers.
As a result of our discussion this morning, if the FOFA Regulations tabled in the Senate on 10 July
2014 are not disallowed, the Government will make further Regulations within 90 days to ensure the
following requirements in the Corporati01uAct 2001 are explicitly listed in the Statement of Advice
provided by financial advisers to their client and signed off by both:




That the adviser is required to act in the best interest of their client and prioritise their client's
interests ahead of their own, consistent with the requirements in subsection 961B and 961] of the
Co1porations Ad 2001;
That any fees be disclosed and that the adviser will provide a fee disclosure statement annually, if
the client enters into, or has entered into, an ongoing fee arrangement after 1 July 2013 (fhis is
already required under our amended financial advice laws);
That a client has the right to return financial products under a 14-day cooling-off period in
accordance with the requirements currently provided under Division 5 of Part 7.9 of the
Corporatiolls Act 2001; and
That the client has the right to change his or her instructions to their adviser, if for example they
experience a change in their circumstances.
These regulations will also specify that any instructions to alter or review instructions must be in
writing, signed by the client, and acknowledged by the adviser.
There will also be a requirement in those regulations that in that Statement of Advice the financial
adviser provides an explicit statement that he or she genuinely believes that the advice provided to the
client is in the client's best interests, given the client's relevant circumstances.
Parliament !louse Canberra ACI' 2600
Australia
Telephone: 02 6277 7360 Facsimile: 02 6273 4125
There will be a specific requirement enshl.i.ned in those regulations that the Statement of Advice is to be
signed by both the adviser and the client.
These additional requirements will require regulatory change. The Government will make the necessary
regulatoty changes within 90 days.
We also will reflect those changes, as required, in amendments to the actual legislation currently before
the Parliament, the Coporatiom A!JJendment (Streamlining of Fut11re ojFinamial Advice) Bill 2014.
Finally, d1e Government will work in consultation with all relevant stakeholders, to establish an
enhanced public register of financial advisers (including employee advisers), which includes a record of
each adviser's credentials and status in the industry.
On behalf of d1e Government, I appreciate your advice d1at on this basis, the Palmer United Party and
Senator Muir from the Australian Motoring Enthusiasts Party will be in a position to support our
regulations to improve FOF A which came into effect on 1 July 2014, by voting against any
disallowance and to support our FOFA legislation as amended to give effect to the additional measures
in this letter.
The Government appreciates the very consuuctive approach taken by the Pahner United Party and by
Senator Muir on behalf of the Australian Motoring Enthusiasts Party in helping the Government to
io1prove access to affordable, high quality fmancial advice for all Australians.
I have copied this letter to the Prime Minister, the Leader of the Government in the Senate, the Leader
of the H se and the Manager of Government Business in the Senate.
MATHIAS CORMANN
IS July 2014