Financial Markets Conduct Regulations 2014

229E Information that must be given when advice given

(1)

The purpose of this regulation is to give retail clients information that will help them to make an informed decision about whether to act on advice that they have been given.

(2)

A person (A) who gives advice to a client must give the client the following information:

(a)

all of the information set out in clause 6 of Schedule 21A that is applicable; and

(b)

if any of the information set out in clause 5(1) of Schedule 21A has materially changed since the client was last given it (when considered as a whole together with any other information the client has been given under regulation 229D or this regulation), an updated version of the information or an explanation of what has changed.

Example (continued from regulation 229D)

ABC Limited only gives advice in relation to products from particular lenders.

After Alice has told Claire the names of the particular lenders under clause 5(1)(b) of Schedule 21A, but before Alice gives Claire the mortgage advice, ABC Limited changes its arrangements with a particular lender. As a result, ABC Limited is no longer giving advice about the financial products of that lender.

Alice emails Claire the advice. In the same email, Alice must give Claire—

  • all of the information set out in clause 6 of Schedule 21A that is applicable; and

  • information about the change to the lender. Alice can do this by giving Claire an updated statement and list of names (see clause 5(1)(b) of Schedule 21A) or an explanation of the change.

(3)

A must give the information—

(a)

before, or at the same time as, the advice is given; or

(b)

if it is not practicable to comply with paragraph (a), as soon as practicable after the advice is given.

(4)

Nothing in this regulation prevents A from giving the information required by this regulation at the same time that it gives the information required by regulation 229D.

Example

Alex is a financial adviser who works for a bank.

Charlotte asks Alex for some financial advice about term deposits and other investment options offered by the bank.

Alex gives Charlotte all of the information required by regulations 229D and 229E at the same time (before the advice is given). Alex was able to give all of the information at the same time because Alex knew all of it by the time the nature and scope of the advice were known.

(5)

Subclause (4) does not limit regulation 229D(4) and (5).

Regulation 229E: inserted, on 15 March 2021, by regulation 12 of the Financial Markets Conduct (Regulated Financial Advice Disclosure) Amendment Regulations 2020 (LI 2020/132).