The Association of Superannuation Funds of Australia (ASFA) has used a supplementary submission to the Parliamentary Inquiry into the Structure and Operation of the Superannuation Industry to reinforce the need for more clarity on the definition of financial advice.
In particular, ASFA has recommended changes to section 766B of the Corporations Act, including narrowing the definition of financial advice to enable superannuation funds to adopt a more educative role.
“By narrowing the definition of financial advice to be more focused on the delivery of communications that urge a person to buy or sell a particular product, the differentiation between ‘personal’ and ‘general’ advice can be removed,” the submission said.
“Under the new definition, all advice effectively becomes ‘personal’ and all information contained within the FSG [Financial Services Guide] and SoA [Statement of Advice] potentially combined into a single document.”
The submission said there had to be clear rules about what, if anything, a superannuation fund had to provide to an existing member.
“If these communications fall within the new financial product advice definition, then they should be subject to different rules either not requiring an SoA or else permitting less onerous obligations,” it said.
