The Association of Superannuation Funds of Australia (ASFA) believes it is not clear how proposed education and training requirements for financial advisers would apply to robo-advice.
ASFA says if financial advice was to be provided online (robo-advice) by a corporate entity it is unclear how proposed regulation and professional standards would apply to individuals.
In its submission to Treasury on draft legislation aiming to lift professional standards of financial advice, ASFA also said advisers authorised to only provide intra-fund advice should not be required to obtain the equivalent qualifications as those who provide comprehensive advice.
ASFA said persons providing advice to wholesale clients do not need to meet the proposed education and training requirements but can continue to call themselves financial advisers or planners and it "may lead to consumer confusion."
Both ASFA and the Association of Financial Advisers (AFA) agree that existing financial advisers should be qualified at AQF6 - in line with the Advanced Diploma of Financial Planning rather than an undergraduate degree or AQF7.
AFA chief executive Brad Fox said there are financial advisers in the AFA community "who have a long and untarnished track record of providing quality advice" and their extensive knowledge, skills and experience deserve to be formally recognised.
Fox said these advisers are compliant professional association codes, have no ASIC breaches, have an Advanced Diploma of Financial Planning or higher - including the post-graduate Fellow Chartered Financial Practitioner (FChFP) designation - and a record of continuing professional development.
He added the draft legislation calls for the establishment of a Standard Setting Body (from 1 July 2016) to decide upon professional standards of financial advisers, including transition arrangements for existing advisers, with a board of seven directors.
"To ensure that the board fully understands how standards will affect small business financial advisers, we believe it is absolutely essential for one of these directors to be a small business practitioner," Fox said.
Under the proposed legislation new financial advisers will require a degree, undertake a professional year and pass an exam. Existing advisers will be provided a transition process and will be required to complete an appropriate degree equivalent and pass an exam. All advisers both new and existing will also be required to undertake continuing professional development (CPD) and be party to a code of ethics. The requirements are proposed to be effective from 1 July 2017, with a code of ethics coming into force from 1 July 2019.
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