Minimum Competency Code 2017
The Central Bank has issued a revised Minimum Competency Code and new Minimum Competency Regulations 2017. Together, they replace the former Code and The measures will take effect on January 3, 2018. The new minimum competency framework reflects recent EU developments relating to professional knowledge and competence requirements contained in the Mortgage Credit Regulations, the revised Markets in Financial Instruments Directive and the Insurance Distribution Directive
The revised Minmum Competency Code 2017 will impact on the financial services industry including CPA regulated Investment Business Firms.
Key changes in the Minimum Competency Code 2017 include the following;
Like the existing code, the revised Minimum Competency Code comprises three parts together with a number of appendices. However, Part 2 of the revised code now deals with additional standards for certain functions, while the requirements on Firms, currently set out in Part 2 of the Minimum Competency code 2011, are contained in the Regulations
Part 1 deals with Fitness and Probity Standards and Part 2 of this Code specifies certain minimum competency standards with which persons falling within the scope of this Code must comply when performing controlled functions. The minimum competency standards have been amended to take account of professional knowledge and competency requirements. Part 3 of this Code sets out details on the recognition of qualifications in respect of retail financial products for the purposes of the Code.
Regulated firms must ensure that their staff have obtained competence and skills that are appropriate to the function that they carry out through experience or training gained in an employment context, in addition to obtaining a relevant recognised qualification;
At least one key staff member with material influence on the final decision regarding the design of a retail financial product must meet a prescribed standard of minimum competency. The question of who has "material influence" is at the discretion of the relevant firm; and
Regulated firms must carry out an annual review of the development and experience needs of their staff.
A new entrant shall be taken to comply with the Standards where he /she participates in a training process that includes the following requirements:
- The new entrant must first undergo a training programme organised by the regulated firm on whose behalf the new entrant is acting.
- The new entrant must act under the immediate direction and supervision of another nominated person, who is a person who meets the Standards set out in Section 1. of the code.
- The new entrant is working towards a recognised qualification.