The FMA has provided some insight into the requirements of the full license. It has been revealed that advisers can begin the application process from 15 March 2021. Although the process will be similar to the transitional license, the questions advisers will be required to answer have been described as being more rigorous. Unlike transitional licenses, full licenses will not have expiration dates. John Botica, director of market engagement, has noted that classes and conditions are another difference between the two license types.
“Advisers will be able to start applying for a full license on March 15, 2021, and the FMA says the process will be similar to what advisers have done for their transitional license – however, it says its questioning will also be a lot more rigorous.
According to FMA director of market engagement John Botica, the key differences between transitional and full licensing will be the time period they cover, and the different classes and conditions attached to a full license. He says the FMA will also go into more depth around an adviser’s practices and procedures.
“Transitional licenses last for up to two years, from March 15, 2021, to March 15, 2023, whereas a full license has no fixed term,” Botica explained.”
An important aspect of the full license is that it will include three different license classes. It will be important that advisers choose the right class as they will need to go through the full license application process again if they need to amend their class selection. Botica noted that advisers with transitional licenses will have two years to apply for their full license while new advisers must apply for full licenses. It has also been revealed that questions around competency, to conduct, to conflicts of interest will be examined during the application process.
““You have that license for as long as you continue to run your business. The full process also includes three different license classes, and it’s important to choose the right class – if you need to change it, you’ll need to go through the application process again.”
“There were two standard conditions for transitional licensing, and for the full license, we add another five,” he continued.
“That was subject to consultation, and we had an overwhelmingly positive response from everyone around standard conditions.”
Botica confirmed that there will be a two year period in which advisers can apply for a full license, and the competency safe harbour will last for those two years. However, new advisers will need to go straight to a full license – they won’t be able to obtain a transitional.
Botica says the questions asked by the FMA will also be much deeper, and will touch on everything from competency, to conduct, to conflicts of interest.” Click here to read more
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