Guidance Note on Training and Competency Schemes (November 2021)

Summary

This Guidance Note explains the GFSC's expectations for training and competency (T&C) schemes that must be maintained by investment business licensees and insurance intermediaries, in line with the Licensees (Conduct of Business Rules), 2021 and the Insurance Intermediaries Rules, 2021. It covers general requirements for all employees, plus specific rules for Authorised Insurance Representatives (AIRs) and Financial Advisers (FAs), including qualification deadlines and Statements of Professional Standing (SPS).

• All employees: Licensees must have a documented Scheme assessing and monitoring each employee's ongoing competence, training needs and progress, with Board oversight (which may be delegated to a senior person).
• AIRs: An employee may not be authorised as an AIR until deemed competent and any minimum qualification criteria are met; AIRs advising on long term pure protection products must hold a specified professional qualification (currently CII Certificate in Financial Services or equivalent).
• FAs qualification pathway: FAs appointed on or after 1 January 2015 who are not fully qualified have 30 months from appointment to obtain an acceptable level 4 qualification, or their authorisation must be revoked; this period may be suspended for extended absences.
• Legacy FAs: Advisers appointed on or before 31 December 2014 without the minimum qualification could advise retail clients only until 31 December 2015, after which they had to be de-authorised if unqualified.
• CPD for FAs: FAs must complete a minimum of 35 hours of relevant CPD annually, of which at least 21 hours must be structured.
• Statements of Professional Standing: Licensees must obtain a valid SPS annually for each FA and de-authorise any FA (barring them from advising retail clients) if a valid SPS is not provided within the specified timescales.
• Supervision: Licensees must ensure supervisors have appropriate skills and experience, with supervision intensity scaled to the employee's qualification and competence level (unqualified, part qualified, fully qualified).

The Note is guidance rather than binding rule text itself, but it sets out the Commission's expectations for compliance with the underlying Conduct of Business Rules and Insurance Intermediaries Rules, including firm-specific deadlines tied to individual employees' appointment and qualification dates.

Key obligations

• Maintain a documented training and competency Scheme for all employees, assessing ongoing competence and identifying training needs
• Do not authorise an employee as an AIR or FA until they are deemed competent and meet applicable minimum qualification criteria
• Ensure FAs appointed on or after 1 January 2015 who are not fully qualified obtain an acceptable level 4 qualification within 30 months of appointment, or revoke their FA authorisation
• De-authorise any FA appointed on or before 31 December 2014 who had not achieved an acceptable level 4 qualification by 31 December 2015
• Ensure FAs complete a minimum of 35 hours of CPD annually, at least 21 hours of which is structured
• Obtain a valid SPS for each FA appointed on or before 31 December 2015 no later than 31 March 2016, and annually thereafter; de-authorise the FA if a valid SPS is not obtained within the allotted time
• Obtain a valid SPS within 3 months of a newly qualified or newly appointed fully qualified employee becoming an FA
• Ensure supervisors of employees, AIRs and FAs have appropriate coaching, assessment skills and technical knowledge
• Retain SPS records (original or copy) and return the original SPS to an FA upon de-authorisation

Applies to

entities licensed under the Protection of Investors (Bailiwick of Guernsey) Law, 2020, insurance intermediaries licensed under the Insurance Managers and Insurance Intermediaries (Bailiwick of Guernsey) Law, 2002, authorised insurance representatives (AIRs), financial advisers (FAs)

Deadlines

• 1 January 2015: Date from which licensees and insurance intermediaries have been required to have a training and competency scheme in place
• 31 December 2015: Deadline for advisers appointed on or before 31 December 2014 without the minimum qualification to have achieved an acceptable level 4 qualification, otherwise they must be de-authorised
• 30 months from appointment as FA: Deadline for FAs appointed on or after 1 January 2015 who are not fully qualified to obtain an acceptable level 4 qualification, otherwise authorisation must be revoked
• 31 March 2016: Deadline for licensees to have obtained a valid SPS for each FA appointed on or before 31 December 2015
• within 3 months of SPS expiry: If a new SPS is not provided within 3 months of an existing SPS expiring, the licensee must de-authorise the FA
• within 3 months of qualification completion or FA appointment: Licensee must obtain a valid SPS within 3 months of an employee completing an acceptable qualification or being appointed as a fully qualified FA
• annually: FAs must complete a minimum of 35 hours of CPD (at least 21 structured) each year and licensees must obtain a renewed SPS on an ongoing annual basis