A bill that makes some small but important tweaks to new financial regulations passed its first reading in Parliament last night.

The Financial Services Providers (Pre-Implementation Adjustments) Bill makes technical amendments to the Financial Service Providers (Registration and Dispute Resolution) Act and the Financial Advisers Act.

The amendment bill focuses on changes to the Qualifying Financial Entity (QFE) model under the new regime that will allow companies to take responsibility for the advice from their employees.

The changes include requiring a QFE to name the individual contractors it will take responsibility for, instead of automatically being responsible for advice from all its contractors.

They will allow a QFE’s named contractors to provide financial advice on the QFE’s category one investment products (complex products such as shares), without being individually licensed; this is currently allowed only for the QFE’s employees.

Another change will allow employees and named contractors to provide financial advice on products which the QFE promotes; currently the Financial Advisers Act allows this only if the QFE issues the product.

One of the problems with allowing this only if the QFE issues the product is that trustees are classified as the issuers under KiwiSaver rather than the companies that actually provide the KiwiSaver products.

Commerce Minister Simon Power said there could be further changes added in after the select committee process.