Press Release 01 September 2011
Tá an preasráiteas seo ar fáil as gaeilge chomh maith
The Central Bank of Ireland today published the revised Minimum Competency Code which enhances the minimum professional standards for all persons who provide consumers with financial advice and products or undertake certain specified functions. The Code, which comes into effect from 1 December 2011, follows consultation with regulated entities, consumer and industry representative bodies and professional education bodies.
Under the existing requirements, regulated firms have to ensure that all persons providing financial advice and services on their behalf hold a recognised professional qualification or have gained experience through working in the industry for a specified period of time. A programme of Continuing Professional Development (CPD) must also be undertaken on an ongoing basis. Under this enhanced Code, this responsibility is now placed on all persons carrying out relevant functions, as well as the firms, in line with the Central Bank’s new Fitness and Probity requirements which are also published today and will come into effect on 1 December 2011.
Other enhancements to the Minimum Competency 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.
The consultation included the proposed phasing out of ‘grandfathering’2 and the requirement for all grandfathered persons to obtain a relevant, recognised qualification by 2015. Following consideration of the responses and other advice received, the Central Bank has decided not to phase out the existing grandfathering arrangements but will require regulated firms to complete and hold a standard Statement of Grandfathered Status on file which sets out the activities in respect of which each person has been grandfathered.
Director of Consumer Protection, Bernard Sheridan, said: ‘All consumers need to have confidence that they are receiving the best possible financial advice and services at all times. We are committed to strengthening consumer protection by requiring minimum professional competencies and standards of all persons providing consumer advice and services. This enhanced Code now places an onus on both the firms and persons to comply fully with their supervision and professional development requirements.
The professional education bodies have restructured the two main existing recognised qualifications so that there will now be specific qualifications in areas such as personal general insurance, life assurance, and savings and investment. This restructuring will increase accessibility to a wider range of professional development opportunities for all persons and particularly for those who are grandfathered and providing financial advice and services in specific areas. As evidenced by recent research undertaken by the NCA, consumers value both qualifications and experience when choosing a financial adviser and, in this context, I would encourage all grandfathered persons to consider undertaking one of the new qualifications’.
The Minimum Competency Code is available here. The responses to the Central Bank consultation on minimum competency code are available to view here.
 Specified functions include assisting consumers in dealing with claims, reinsurance mediation, managing or supervising accredited persons and adjudicating on complaints.
 When the Minimum Competency Requirements were introduced in 2007, they included grandfathering provisions for those individuals who were carrying out certain activities on 1 January 2007 and had four years’ experience carrying out those activities in the eight-year period from 1 January 1999 to 1 January 2007.
An Addendum to the Requirements was issued in 2008 which set out grandfathering provisions for those carrying out activities related to retail credit and home reversion agreements on 1 June 2008 with four years’ experience in the eight-year period from 1 June 2000 to 1 June 2008.
 On 1 September 2011, the Central Bank will publish on its website Regulations (prescribing who will be covered by the new Fitness and Probity regime), statutory Standards of Fitness and Probity (setting out the relevant standards which will apply to those covered in the regime) and Guidance on the new regime.