Qualifying Financial Entities and QFE Advisers

Read FMA's 2014 Qualifying Financial Entities Monitoring Report
Read FMA's QFE Annual Report Feedback 2013

Qualifying Financial Entities (QFEs) must, during the period of their QFE status:

A QFE also has responsibility to ensure that members of its QFE group and employees and nominated representatives of the QFE Group comply with the terms and conditions of grant of QFE status and that employees and nominated representatives comply with their financial adviser obligations.

QFE advisers

An adviser who provides personalised adviser services to retail clients on category 1 products not issued or promoted by the QFE or a member of the QFE group must be an Authorised Financial Adviser (AFA). They will be subject to the obligations that apply to AFAs.

QFE advisers are not subject to the Code of Professional Conduct for Authorised Financial Advisers. However, their QFE must demonstrate that it maintains procedures to ensure that retail clients receive adequate protection. For services for category 1 products, FMA must consider whether the QFE's clients receive protection of a similar standard to that provided by advisers who are subject to the Code, taking into account their scope of products. See section 66 of the Act.

The standard of professionalism expected from QFE and non-QFE advisers doing similar work is the same.

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