The Minimum Competency Requirements (the Requirements) were introduced on 1 January 2007 and established minimum professional standards for financial services providers, with particular emphasis on areas dealing with consumers. The Requirements were introduced to ensure that consumers obtain a minimum acceptable level of competence from individuals acting for or on behalf of regulated firms in the provision of advice and associated activities in connection with retail financial products.
Following a consultation process, the Requirements were reviewed and will be replaced by the new Minimum Competency Code 2011 (the Code), which was published on 1 September 2011 and will come into effect on 1 December 2011. The new Code applies to regulated firms and persons carrying out controlled functions within those firms who:
- provide advice to consumers on retail financial products,
- arrange or offer to arrange retail financial products for consumers, including any amendments to insurance cover and the restructuring or rescheduling of loans, or
- undertake certain specified functions.
In addition, those persons are required to undertake a programme of Continuing Professional Development (CPD).
The revised Code is issued, in part, under Section 50 of the Central Bank Reform Act 2010 and is closely linked to the new Fitness and Probity regime which also comes into effect on 1 December 2011.
The main amendments to the Code include:
- An annual requirement of 15 formal hours of CPD for all persons, including grandfathered persons, to replace the existing 3 year CPD cycle requirements;
- Inclusion of an Ethics module in CPD programme;
- Detailed supervision requirements for all new entrants;
- Clarification on activities included within the scope of the requirements including restructuring and rescheduling of loans, amendments to insurance policies and services provided over the internet; and
- Restructuring of the categories of retail financial products.