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News

This section contains our 2017-2019 news updates. For 2000-2016 news updates, please see our Archive.

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Industry funding reminder for financial services licensees

15 May 2019

ASIC has today reminded Australian financial services and Australian credit licensees who have industry funding obligations to factor in the time it may take ASIC to assess applications to cancel or vary their licence, as part of any measures by licensees to reduce the industry levy they are charged for the 2019-20 financial year.

Licensees with authorisations which are current on 1 July 2019 are liable to pay various types of industry funding levies related to the 2019-20 financial year, depending on the authorisations and conditions of the licence. Invoices to recover ASIC’s regulatory costs for 2019-20 will be issued in January 2021.

For further information refer to ASIC's website.

Doing the right thing by your customers: ASIC consults on lifting standards and transparency of complaints handling
15 May 2019

ASIC has today initiated public consultation on new standards about how financial firms handle consumer and small business complaints. The proposed standards, which include new mandatory data reporting, will improve the way that consumer complaints are dealt with across the financial system and make firms' complaints handling performance transparent.

Financial firms will be required by ASIC to meet the new standards when they deal with consumer complaints through their Internal Dispute Resolution (IDR) arrangements.

The proposed new standards have been informed by recent consumer research by ASIC and findings from aspects of ASIC’s new onsite supervisory program – Close and Continuous Monitoring – which is currently reviewing IDR policies, practices and procedures in Australia's five largest and most complex financial services institutions.

The consultation covers:

  • proposed updates to ASIC's IDR standards (currently set out in Regulatory Guide 165 Licensing: Internal and external dispute resolution); and
  • the proposed framework for mandatory IDR data reporting by financial firms to ASIC.

ASIC seeks public input on the consultation documents by 9 August 2019 and aims to release new IDR standards (in a new Regulatory Guide 165) by end 2019. A further, separate consultation on the publication of IDR data will commence in early 2020.

For further information refer to ASIC's website.

Corporate Collective Investment Vehicle Bill
17 January 2019

The Government has today released for public consultation two bills that implement the tax and regulatory components of the CCIV regime and their related explanatory materials.

The proposed new law includes:

  • the new Chapter 8B in the Corporations Act containing the core provisions outlining the establishment of CCIVs and their operational and regulatory requirements;
  • amendments to other legislation to support the implementation of CCIVs (such as amendments to the Australian Securities and Investments Commission Act 2001 and the Personal Property Securities Act 2009); and
  • the tax legislation, which ensures the tax treatment of CCIVs broadly aligns with the existing treatment of attribution managed investment trusts, providing investors with the benefits of flow-through taxation.

The closing date for submissions is 28 February 2019.

For further information refer to Treasury's website.

ASIC releases consultation paper on reform of fees and costs disclosure for superannuation and managed investment schemes
8 January 2019

ASIC has today released Consultation Paper 308 Review of RG 97 Disclosing fees and costs in PDSs and periodic statements (CP 308) seeking feedback on proposed changes to the fees and costs disclosure regime for managed investment schemes and superannuation.

The consultation paper includes a proposed updated Regulatory Guide 97 Disclosing fees and costs in PDSs and periodic statements (RG 97), as well as draft amendments to Schedule 10 of the Corporations Regulations.

CP 308 sets out ASIC's response to recommendations from a review of the regime by external expert, Mr Darren McShane. Report 581 Review of ASIC Regulatory Guide 97: Disclosing fees and costs in PDSs and periodic statements (REP 581) was released in July 2018 following extensive industry consultation.

ASIC proposes to take forward key recommendations from REP 581 that relate to:

  • simplifying how fees and costs information is presented to consumers;
  • reducing data inputs, including eliminating the requirement for fees and costs disclosure to incorporate some costs categories, particularly property operating costs, borrowing costs and implicit costs; and
  • making disclosure for managed investment schemes more consistent with superannuation.

Submissions are due 2 April 2019. For further information refer to ASIC's website. For background information refer to our Breaking News for 13 June 2018.

ASIC advice to AFS licensees about upcoming changes to education and training requirements
17 December 2018

From 1 January 2019, new professional standards requirements for financial advisers will progressively replace training standards in Regulatory Guide 146 Licensing: Training of financial product advisers (RG 146).

RG 146 sets out the minimum training standards for financial advisers. Training standards vary depending on whether the adviser provides general or personal advice and on the complexity of the financial products. It also provides guidance on how advisers can meet these training standards.

For further information refer to ASIC's website.

ASIC extends transition period for some fees and costs disclosures
11 December 2018

ASIC has today extended the transition periods for certain fees and costs disclosures for superannuation funds and managed investment schemes. This is due to upcoming consultation on the proposals arising out of recommendations made in the review of the fees and costs disclosure regime in Report 581 Review of ASIC Regulatory Guide 97: Disclosing fees and costs (REP 581). For further information refer to ASIC's website and our Client Update.

Corporations Amendment (Design and Distribution Obligations and Product Intervention Powers) Regulations 2018
23 October 2018

The Government has today released for public consultation exposure draft regulations to support the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2018 and an explanatory statement.

The Bill implements the Government's response to the Financial System Inquiry (FSI), Improving Australi's Financial System 2015, whereby the Government accepted the FSI's recommendations to introduce:

  • design and distribution obligations for financial products to ensure that products are targeted at the right people (FSI recommendation 21); and
  • a product intervention power for the Australian Securities and Investments Commission (ASIC) when there is a risk of significant consumer detriment (FSI recommendation 22).

Submissions are due 13 November 2018. For further information refer to Treasury's website.

Corporate Collective Investment Vehicle – tranche three
12 October 2018

The Government has today released for public consultation the third tranche of the Treasury Laws Amendment (Corporate Collective Investment Vehicle) Bill 2018 and related explanatory materials.

The closing date for submissions is 26 October 2018. For further information including to see a copy of the Exposure Draft and Explanatory Materials refer to Treasury's website. For background information refer to our Breaking News on 19 July 2018 and 13 June 2018.

Financial adviser professional standards reforms – ASIC releases new instrument delaying reporting dates and making minor amendments
10 October 2018

ASIC has today released a new legislative instrument relating to the professional standards reforms for financial advisers, as announced on 1 August 2018.

The instrument makes changes to the reporting dates for a number of disclosure obligations in the transition to the new financial adviser professional standards reforms.

It also makes minor technical amendments to address unintended consequences to ensure that the new education and training standards apply in a consistent way to individuals at the intended time.

These changes do not affect advisers’ and licensees’ substantive obligations under the professional standards reforms. Advisers and licensees must still comply with the new substantive professionalism and education requirements and licensees must keep appropriate records for compliance purposes.

Further information about the changes to notification dates can be found on ASIC’s Professional standards for financial advisers – reforms website. For background information refer to our Breaking News for 1 August 2018.

All managed discretionary account providers now required to be licensed
1 October 2018

From today, all managed discretionary account (MDA) providers must now have an Australian financial services (AFS) licence, with an MDA-specific 'dealing by issue' licence authorisation.

MDA providers who do not have the required AFS licence authorisations must cease providing MDAs until they have obtained those authorisations.

For further information refer to ASIC's website.

ASIC remakes ‘sunsetting’ class order about group purchasing bodies and extends the relief to limited licensees
19 September 2018

ASIC has today remade Class Order [CO 08/1] Group purchasing bodies, which was due to expire on 1 October 2018.

The new instrument, ASIC Corporations (Group Purchasing Bodies) Instrument 2018/751, continues to provide class relief to eligible group purchasing bodies from the following requirements in the Corporations Act 2001:

  • registration of a managed investment scheme under Chapter 5C;
  • Australian financial services (AFS) licensing for certain activities (dealing, providing custodial or depository services and providing certain financial product advice) relating to risk management products; and
  • certain other requirements in Chapter 7 relating to disclosure and other conduct.

The only substantive change to the class relief in the new instrument is that the new instrument expressly extends the class relief to holders of 'limited licences'.

ASIC is extending the period of the relief given under [CO 08/1] to undertake a more detailed review of the policy settings behind the class relief to ensure it operates effectively. Following this review, ASIC will look to repeal Instrument 2018/751 and replace it with a framework that includes any changes that have been identified as appropriate.

ASIC anticipate reaching a final outcome by end 2020.

For further information see ASIC's website.

ASIC updates guidance for trustees of wholesale equity schemes
4 September 2018

ASIC has released Regulatory Guide 192 Licensing: Wholesale equity schemes (RG 192) following public consultation.

The updates to the guidance reflect:

  • the changes made to the relief provided in ASIC Corporations (Wholesale Equity Scheme Trustees) Instrument 2017/849 to trustees of wholesale equity schemes that are operated by a manager holding an Australian financial services (AFS) licence, and
  • the amendments made to the financial requirements that may apply to these managers in ASIC Corporations (Amendment and Repeal Instrument 2017/848.

For further information refer to ASIC's website.

Professional standards reforms for financial advisers – ASIC update
1 August 2018

ASIC has today announced changes to reporting dates for a number of required notifications in the transition to the new financial adviser professional standards reforms. The revised schedule is intended to simplify licensees' disclosure obligations. ASIC is also clarifying the process for recognising advisers as 'existing providers'.

Financial advisers who are listed on the Financial Advisers Register (FAR) between 1 January 2016 and 1 January 2019 will be recognised as an 'existing provider' under the new professional standards. Therefore, financial advisers who are currently authorised to provide personal advice to retail clients on more complex financial products should make sure they are on FAR.

Without recognition as an 'existing provider' an adviser must pass an exam and complete an approved qualification by 1 January 2019 to work as a financial adviser. They must also undertake a year of work and training.

If a person is an 'existing provider', they have until 1 January 2021 to pass the exam, and 1 January 2024 to complete an approved qualification. In the meantime, they can continue to work as a financial adviser.

Financial advisers can demonstrate that they are an 'existing provider' if they are:

  • 'current' on the Financial Advisers Register (FAR) at any time between 1 January 2016 and 1 January 2019; and
  • not banned, suspended or disqualified as at 1 January 2019.

ASIC will also make changes to the timing of the earliest notification requirements under the professional standards reforms. These changes will simplify licensees’ notification obligations and enable ASIC to implement the required systems changes more effectively.

These changes do not affect advisers’ and licensees' substantive obligations under the professional standards reforms. Advisers and licensees must still comply with the new substantive professionalism and education requirements and licensees must keep appropriate records for compliance purposes.

A key change is that ASIC will push back the timing for licensees to notify of new advisers who are joining the industry for the first time after 1 January 2019. As a result, new ‘provisional relevant providers’ can only be added to FAR from 15 November 2019.

For further information refer to ASIC's website.

ASIC updates guidance for funds management industry
31 July 2018

ASIC has today released a suite of seven new and updated regulatory guides to provide comprehensive guidance to the funds management industry. The updates are designed to help the funds management industry to access the Asia Region Funds Passport. The passport is designed to provide investors with access to funds from participating economies throughout the Asia region.

The new and updated regulatory guides are:

For further information refer to ASIC's website.

External report on fees and costs disclosure welcomed by ASIC
24 July 2018

ASIC has today released the external report into Regulatory Guide 97 Fees and costs disclosure (RG 97) commissioned in November 2017 (REP 581 Review of ASIC Regulatory Guide 97: Disclosing fees and costs in PDSs and periodic statements).

The report, prepared by Mr Darren McShane, concludes changes to the disclosure regime would be advantageous, and includes discussion of:

  • the way fee and cost information is presented to consumers; and
  • some of the information to be included in this disclosure.

For further information refer to ASIC's website.

Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Power) Bill 2018
20 July 2018

The Government has today released for public consultation a revised exposure draft of the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2018 and explanatory materials.

These measures implement the Government’s response to the Financial System Inquiry (FSI), Improving Australia’s Financial System 2015, whereby the Government accepted the FSI’s recommendations to introduce:

  • design and distribution obligations for financial products to ensure that products are targeted at the right people (FSI recommendation 21); and
  • a product intervention power for ASIC when there is a risk of significant consumer detriment (FSI recommendation 22).

Submissions are due 15 August 2018. For further information refer to Treasury's website.

Corporate Collective Investment Vehicle – tranche two
19 July 2018

The Government has today released for public consultation the second tranche of the Treasury Laws Amendment (Corporate Collective Investment Vehicle) Bill 2018 and explanatory materials.

The closing date for submissions is 10 August 2018.

For further information refer to Treasury's website. For background information refer to our Breaking News 13 June 2018.

ASIC releases guidance for overseeing the Australian Financial Complaints Authority (AFCA)
20 June 2018

ASIC has today released Regulatory Guide 267 Oversight of the Australian Financial Complaints Authority (RG 267) ahead of the commencement of the Australian Financial Complaints Authority (AFCA) on 1 November 2018.

Report 577 Response to submissions on CP 298 Oversight of the Australian Financial Complaints Authority (REP 577) sets out ASIC’s response to submissions received to CP 298, which was issued in March 2018.

ASIC will retain its existing guidance in Regulatory Guide 139 Approval and oversight of external dispute resolution schemes (RG 139) until all complaints made under the existing approved schemes, the Financial Ombudsman Service and the Credit and Investments Ombudsman have been resolved. ASIC will then withdraw that guidance.

Licensees and credit representatives must continue to maintain their EDR membership through the transition period, including paying membership and other scheme fees in full as required.

For further information refer to ASIC's website.

Corporate Collective Investment Vehicle
13 June 2018

The Government has today released for public consultation the first tranche of the Treasury Laws Amendment (Corporate Collective Investment Vehicle) Bill 2018 and explanatory materials.

The closing date for submissions is 11 July 2018.

For further information refer to Treasury's website.

ASIC temporarily extends relief for managed investment and superannuation schemes for certain disclosure obligations
4 June 2018

ASIC has today extended two ASIC instruments to allow additional time to consider the policy position in relation to certain disclosure obligations of managed investment schemes and superannuation trustees.

The relevant instruments are: [CO 12/749] Relief from the Shorter PDS regime and ASIC Superannuation (RSE Websites) Instrument 2017/570. Each instrument had been due to expire on 30 June 2018.

These extensions will maintain the status quo in the meantime, enabling ASIC to adjust or revoke the relief once the policy position is settled by Government.

The expiry dates specified in the instruments align with the usual 10-year sunsetting period for legislative instruments under the Legislation Act 2003. ASIC has said that no assumption should be made that the instruments will continue in force for that length of time.

For further information refer to ASIC's website.

ASIC consults on foreign financial services providers relief proposals
1 June 2018

ASIC has today released a consultation paper proposing a modified licensing regime for foreign financial service providers carrying on a financial services business in Australia with wholesale clients. CP 301 sets out ASIC's proposal to enable foreign providers to apply for a modified form of Australian financial services (AFS) licence (foreign AFS licence). Currently foreign providers of services to wholesale clients are not required to hold an AFS licence in some circumstances under ASIC relief.

Providers holding a foreign AFS licence will be exempt from certain licensee provisions under the Corporations Act. This is on the basis that there are similar regulatory outcomes achieved through the regime applying to the foreign provider in its home jurisdiction.

The current foreign provider licensing relief is due to sunset on 27 September 2018. ASIC will extend the current relief for 12 months until 30 September 2019. The consultation paper proposes a further transition period of 12 months to 30 September 2020 if ASIC proceeds with foreign AFS licensing.

Submissions are due 31 July 2018.

For further information refer to ASIC's website and our Client Update.

ASIC consults on code of ethics compliance schemes for financial advisers
15 May 2018

ASIC has today released a consultation paper outlining its proposed approach to approving and overseeing compliance schemes for financial advisers.

Incoming training and education requirements for financial advisers include obligations to comply with a code of ethics that is being developed by the Financial Adviser Standards and Ethics Authority (FASEA). Under the new legislative regime for adviser professional standards, compliance with this code of ethics will be enforced by ASIC-approved compliance schemes.

The proposals in CP 300 Approval and oversight of compliance schemes for financial advisers include:

  • the process for applying for approval of a compliance scheme;
  • ASIC's expectations for the governance and administration, monitoring and enforcement processes, and ongoing operation of compliance schemes;
  • how ASIC propose to exercise its powers to revoke the approval of a compliance scheme and to impose or vary conditions on the approval;
  • ASIC's proposal to modify the law to ensure that monitoring bodies can gather the information from Australian Financial Services (AFS) licensees and authorised representatives that they need to carry out proactive monitoring activities; and
  • draft guidance about the notifications that monitoring bodies must make to ASIC.

Submissions are due 28 June 2018 and ASIC plans to release a regulatory guide setting out its final policy by the end of September 2018.

For further information refer to ASIC's website.

ASIC releases guidance on AFS licensing exemption for tax and BAS agents
26 April 2018

ASIC has today updated its guidance for accountants who provide services on self-managed superannuation funds to cover the exemption from the Australian Financial Services licensing requirements for tax and BAS agents. The guidance was developed in conjunction with the Tax Practitioners Board and is being released as part of updates to Information Sheet 216 AFS licensing requirements for accountants who provide SMSF services (INFO 216).

For further information refer to ASIC's website.

Reform of the Financial Sector (Shareholdings) Act 1998
19 April 2018

The Government today released exposure draft legislation to relax the restriction on ownership of banks and insurers as well as introducing a new streamlined approval path under the Financial Sector (Shareholdings) Act 1998 (FSSA).

Under the new framework, to be legislated this year, the Government will:

  • increase the general FSSA ownership cap from 15 per cent to 20 per cent, in line with the requirements of the Foreign Acquisitions and Takeovers Act 1975; and
  • allow owners of domestically incorporated companies to hold more than 20 per cent of an institution's shares as long as:
    • the owners are 'fit and proper'; and
    • if applying to become an authorised deposit-taking institution (ADI: broadly, banks; credit unions; and building societies) or a life insurer, or licensed as such for fewer than five years, the entity has assets of less than $200 million; or
    • if applying to become a general insurance company, or licensed as such for fewer than five years, the entity has assets of less than $50 million.

Submissions are due by 4 May 2018.

For further information (including to see a copy of the exposure draft legislation) refer to Treasury's website.

Australian Government response to the ASIC Enforcement Review Taskforce Report
16 April 2018

In December 2017, the ASIC Enforcement Review Taskforce reported to the Government on its review of ASIC's enforcement regime. The Taskforce made 50 recommendations.

The Government response to the Taskforce report stated that it agrees, or agrees-in-principle, to all of the Taskforce's recommendations.

For further information refer to Treasury's website and our Focus: ASIC's Sanctions and Powers to be strengthened.

ASIC releases updated guidance on client money
4 April 2018

ASIC has today released updated guidance for AFS licensees that hold client money for trading in over-the-counter (OTC) derivatives.

The guidance coincides with the start of ASIC's Client Money Reporting Rules 2017 (client money reporting rules) and other client money reforms on 4 April 2018 enacted under the Treasury Laws Amendment (2016 Measures No. 1) Act 2017 and the Corporations Amendment (Client Money) Regulations 2017.

ASIC Regulatory Guide 212 Client money relating to dealing in OTC derivatives has been updated to reflect the changes to the law as a result of these reforms.

The changes mean that the circumstances in which an AFS licensee may use 'derivative retail client money', within the meaning of the Corporations Act, have been significantly restricted. In particular, AFS licensees can no longer withdraw derivative retail client money from the client money account and use it for a wide range of purposes, including as the licensee's own working capital.

The reforms also impose new record-keeping, reconciliation and reporting requirements on AFS licensees that hold derivative retail client money (unless the client money relates to a derivative that is traded on a fully licensed domestic market, such as ASX 24).

For further information refer to ASIC's website.

ASIC consults on updated guidance for its oversight of the Australian Financial Complaints Authority
5 March 2018

ASIC today released draft updated Regulatory Guide 139, Oversight of Australian Financial Complaints Authority (AFCA) for public consultation.

The Bill to establish AFCA passed on 14 February 2018, and Minister for Financial Services, the Hon. Kelly O'Dwyer has announced that AFCA will commence operations no later than 1 November 2018. There are a number of transitional steps that need to take place before AFCA commences, including that:

  • the Minister will authorise AFCA; and
  • the AFCA Board will consult on the scheme's terms of reference.

ASIC will finalise this guidance to coincide with AFCA commencement (that is, no later than 1 November 2018).

Submissions are due 6 April 2018.

For further information (including to see a copy of the consultation paper and draft regulatory guide) refer to ASIC's website. For background information refer to our Breaking News for 26 July 2017 and 14 February 2018.

Asia Region Funds Passport 2018
19 February 2018

The Government has today announced that it is seeking submissions on a draft of the Asia Region Funds Passport Bill and related explanatory material. The exposure draft includes revisions from the December consultation.

Closing date for submissions is 5 March 2018.

For further information (including to access copies of the exposure draft and explanatory materials) refer to the Treasury website. For background information refer to our Breaking News for 21 December 2017.

ASIC welcomes establishment of the Australian Financial Complaints Authority
14 February 2018

ASIC has today welcomed the passage through Parliament of the Bill to establish the Australian Financial Complaints Authority (AFCA).

ASIC will work with Government and other interested parties to transition to AFCA as smoothly as possible. In the interim, ASIC will continue to oversee the two ASIC-approved schemes – the Financial Ombudsman Service and the Credit and Investments Ombudsman. Separate arrangements are in place for the Superannuation Complaints Tribunal to enable it to deal with existing complaints.

For further information refer to ASIC's website. For background information refer to our Breaking News for 26 July 2017.

Information on new professional standards for financial advisers now available on ASIC website
13 February 2018

ASIC has created a new section on its website to help financial advisers navigate the incoming professional standards requirements.

The new requirements are aimed at lifting the education, training and ethical standards in the financial advice sector.

ASIC's website now provides an overview of the new requirements, as well as related information on:

  • the scope of the reforms;
  • the obligations on advisers;
  • the commencement dates of the reforms;
  • the Financial Adviser Standards and Ethics Authority;
  • compliance schemes for the Code of Ethics, and
  • updates to the Financial Advisers Register.

For further information refer to ASIC's website.

ASIC reports on how large financial institutions manage conflicts of interest in financial advice
24 January 2018

ASIC today released Report 562 Financial advice: Vertically integrated institutions and conflicts of interest (REP 562) covering ASIC’s recent review of financial advice provided by the five biggest vertically integrated financial institutions.

The review looked at the products that ANZ, CBA, NAB, Westpac and AMP financial advice licensees were recommending and at the quality of the advice provided on in-house products. REP 562 outlines the results of this review and identifies areas where improvements are needed to the management of conflicts of interest.

For further information refer to ASIC's website.

Consultation – Asia Region Funds Passport
21 December 2017

The Government today released the draft Asia Region Funds Passport (Passport) Bill and related explanatory materials.

The Passport is a common framework of coordinated regulatory oversight to facilitate cross border issuing of managed investment funds. Australia, Japan, Korea, New Zealand and Thailand are signatories to the Passport’s Memorandum of Cooperation, which took effect on 30 June 2016.

Closing date for submissions is 25 January 2018.

For further information refer to the Treasury website.

Consultation – Corporate Collective Investment Vehicle – Tax framework
21 December 2017

The Government today released the draft Corporate Collective Investment Vehicle (CCIV) Bill and explanatory materials (tax framework). The draft Bill proposes the new tax framework that will give effect to the CCIV. The policy intent of the CCIV is to establish a new form of passive investment vehicle, providing broad alignment with the attribution tax regime for managed investment trusts.

Closing date for submissions is 2 February 2018.

For further information refer to the Treasury website.

ASIC releases guidance on sell-side research
21 December 2017

ASIC today released regulatory guidance on managing conflicts of interest and handling inside information by Australian financial services (AFS) licensees that provide sell-side research.

Regulatory Guide 264 Sell-side research (RG 264) looks at the key stages of a capital raising transaction and provides specific guidelines on how an AFS licensee should appropriately manage conflicts of interest during each of these stages, including the preparation and production of investor education reports. RG 264 also provides general guidance for AFS licensees on the identification and handling of inside information by research analysts, and about the structure and funding of sell-side research teams.

The guidance addresses uneven market practice that has developed since the publication of Regulatory Guide 79 Research report providers: Improving the quality of investment research (RG 79) in 2004. It also responds to industry requests for more detailed guidance on sell-side research and supplements guidance in RG 79.

While RG 264 does not extend the regulatory framework in RG 79, ASIC will give industry six months to 1 July 2018 to make sure their compliance measures conform to the expectations set out in the this guide.

For further information refer to ASIC's website.

ASIC issues guidance for limited AFS licensees
22 November 2017

ASIC has today released a new webpage guidance and information sheets to help limited AFS licensees and their representatives understand their key obligations.

The material released includes:

  • Information Sheet 227 What can limited AFS licensees do? (INFO 227);
  • Information Sheet 228 Limited AFS licensees: Advice conduct and disclosure obligations when providing advice under a limited AFS licence (INFO 228);
  • Information Sheet 229 Limited AFS licensees: Complying with your licensing obligations (INFO 229); and
  • Quick guide: Key obligations when giving advice under a limited AFS licence, available on the ASIC website.

For further information refer to ASIC's website. For background information refer to our Breaking News for 23 June 2012 and 14 June 2013.

ASIC releases guidance for the Financial Services and Credit Panel
16 November 2017

ASIC has today released regulatory guidance on the newly established Financial Services and Credit Panel (FSCP).

Regulatory Guide 263 Financial Services and Credit Panel (RG 263) sets out the principles and processes of the FSCP. It covers the types of matters to be referred to sitting panels of the FSCP and the hearing procedures and decisions of these panels.

The role of the FSCP will be to decide whether ASIC makes banning orders against individuals for misconduct in the course of providing retail financial services and/or engaging in credit activities where the matter is appropriate for peer review because of its significance, complexity or novelty.

For further information refer to ASIC's website. For background information refer to our Breaking News for 11 April 2017.

ASIC confirms restricted use of 'independently owned' in financial services
14 November 2017

ASIC has today updated regulatory guidance to confirm restrictions, that were announced in June 2017, on the use of terminology that implies independence.

ASIC has updated Regulatory Guide 175 Licensing: Financial product advisers – conduct and disclosure (RG 175), to include guidance that terms such as 'independently owned', 'non-aligned' and 'non-institutionally owned' are restricted under the Corporations Act. Financial services providers can only use these terms if they meet the requirements set out in s923A of the Act, including that they do not receive commissions, volume-based payments, or other gifts or benefits, and operate without any conflicts of interest. The six month facilitative compliance period will come to an end on 31 December 2017.

The update to RG 175 also reflects the introduction of s923C into the Corporations Act by the Corporations Amendment (Professional Standards of Financial Advisers) Act 2017, to restrict the use of the titles 'financial adviser' and 'financial planner'. This restriction commences on 1 January 2019 for new advisers, while existing advisers have until at least 1 January 2021 to satisfy the first of their training requirements.

ASIC has also made minor changes to RG 175 to reflect the changes that will be made to Regulatory Guide 90 Example Statement of Advice: Scaled advice for a new client (RG 90). As explained in Consultation Paper 284: Example Statement of Advice for life insurance: Update to RG 90, ASIC is going to replace the example Statement of Advice (SOA) in RG 90 with a new example SOA. The updated RG 90 will be released shortly.

For further information refer to ASIC's website. For background information refer to our Breaking News for 27 June 2017.

ASIC updates work on fee transparency for super and managed investment schemes
1 November 2017

ASIC has today announced that it has extended beyond 30 September its facilitative compliance approach to fee and cost disclosure and will work with an external expert to conduct a review of the fees and costs disclosure under RG 97 to ensure that it is best meeting in practice the objective of greater transparency for consumers.

ASIC is undertaking these actions in response to feedback from across the industry around challenges with the practical implementation of RG 97.

For further information refer to ASIC's website

ASIC overhauls funds management guidance
26 October 2017

ASIC has today released for consultation a suite of six new and updated regulatory guides for the funds management industry.

The regulatory guides have been developed in advance of the upcoming new Asia Region Funds Passport and corporate collective investment vehicle (CCIV) legislation, taking into account these new areas as well as bringing ASIC's funds management policy up to date across the board.

ASIC proposes to consolidate its core guidance for the funds management industry into six regulatory guides covering topics:

  • establishing and registering a fund;
  • constitutions;
  • compliance and oversight;
  • asset holding;
  • how ASIC may exercise its exemption or modification powers and common forms of relief ASIC may grant; and
  • entry and ongoing requirements for foreign passport funds.

The guidance will reflect ASIC's current views on these topics, and apply to managed investment schemes, CCIVs, Australian passport funds and certain other AFS licensees involved in funds management.

ASIC will develop an information sheet on funds management governance considerations and make a range of less substantive amendments to other regulatory guides. These amendments will reflect the consequential amendments that will be made to the Corporations Act to accommodate the new regimes.

For further information (including to see a copy of the consultation paper 296 and draft regulatory guides) refer to ASICs website.

ASIC's client money reporting rules finalised
10 October 2017

ASIC has today released the finalised ASIC Client Money Reporting Rules 2017 (client money rules) which, from 4 April 2018, will impose record-keeping, reconciliation and reporting obligations on Australian financial services (AFS) licensees that hold 'derivative retail client money' within the meaning of the Corporations Act, unless the client money relates to a derivative that is traded on a fully licensed domestic market, such as ASX 24.

ASIC has also today released Information Sheet 226 Complying with the ASIC Client Money Reporting Rules 2017 (INFO 226) to assist AFS licensees comply with their obligations under the client money rules.

The release of the client money rules follows the passage of Treasury Laws Amendment (2016 Measures No. 1) Bill 2016 and the Corporations Amendment (Client Money) Regulations 2017. These reforms will prevent AFS licensees from withdrawing client money provided by retail derivative clients, and using it for the wide range of purposes currently permitted under the Corporations Act, including as the AFS licensee's own working capital.

The client money rules will commence on 4 April 2018, at the same time the other client money reforms take effect. This gives AFS licensees a six month transition period to ensure they have the necessary systems, policies and procedures for complying with the client money rules.

For further information refer to ASIC's website. For background information refer to our Breaking News for 11 July 2017.

ASIC remakes 'sunsetting' class order providing licensing relief for trustees of wholesale equity schemes
29 October 2017

ASIC has today remade Class Order [CO 07/74] Wholesale equity schemes: Licensing relief for trustees, which provides relief, in specific circumstances, to trustees of wholesale equity schemes from the requirement to obtain an Australian financial services (AFS) licence. The Class Order was due to expire on 1 October 2017.

The new instrument, ASIC Corporations (Wholesale Equity Scheme Trustees) Instrument 2017/849 has been updated to take into account financial and custody requirements imposed in 2013 under Class Order [CO 13/760] Financial requirements for responsible entities and operators of investor directed portfolio services, Class Order [CO 13/761] Financial requirements for custodial and depository services and Class Order [CO 13/1410] Holding assets: Standards for providers of custodial and depository services.

ASIC has also issued ASIC Corporations (Amendment and Repeal) Instrument 2017/848, which repeals [CO 07/74] and amends [CO 13/760] and [CO 13/761] as they apply to managers of wholesale equity schemes so that they are consistent with the requirements in the new instrument.

For further information refer to ASIC's website.

ASIC remakes relief for financial counselling agencies providing advice or credit assistance
27 September 2017

ASIC has today made two new legislative instruments relating to financial counselling agencies to continue the relief provided by class orders that were due to expire (‘sunset’):

  • Class Order [CO 03/1063] Licensing relief for financial counselling agencies has been remade in ASIC Corporations (Financial Counselling Agencies) Instrument 2017/792; and
  • Class Order [CO 11/926] Credit licensing exemptions for NGOs (non-government organisations) providing credit assistance to consumers and ASIC Credit (Financial Counselling Agencies) Instrument 2015/992 have been remade in ASIC Credit (Financial Counselling Agencies) Instrument 2017/793.

The relief was made without substantive changes.

For further information refer to ASIC's website.

ASIC facilitates crowd-sourced funding by public companies
21 September 2017

ASIC has today released guidance for public companies and intermediaries to support them in using the new crowd-sourced funding (CSF) regime, which commences on 29 September 2017.

ASIC has released two new regulatory guides:

  • Regulatory Guide 261 Crowd-sourced funding: Guide for public companies (RG 261), with a template CSF offer document to help companies prepare their CSF offers; and
  • Regulatory Guide 262 Crowd-sourced funding: Guide for intermediaries (RG 262).

ASIC has also:

  • updated ASIC Corporations (Consents to Statements) Instrument 2016/72 to reduce the compliance burden associated with obtaining consent for statements in CSF offer documents;
  • issued ASIC Corporations (Financial Requirements for CSF Intermediaries) Instrument 2017/339, which outlines specific minimum requirements for CSF intermediaries; and
  • amended ASIC class orders [CO 13/762], [CO 13/763] and ASIC Corporations (Nominee and Custody Services) Instrument 2016/1156; and
  • Report 544 Response to submissions on CP 288 and CP 289 on crowd-sourced funding (REP 544).

For further information see ASIC's website.

Applications for crowd-funding licences open 29 September 2017
12 September 2017

ASIC has today released further details of its approach to the assessment of CSF intermediaries, and the information required for both new licence and variation applications seeking CSF service authorisation.

From 29 September 2017, the new crowd-sourced funding (CSF) regime will come into effect and ASIC will begin accepting licence applications from CSF intermediaries.

Under the CSF regime, eligible public companies will be able to make offers of fully paid ordinary shares to a large number of investors via the online platform of a licensed intermediary. Generally, the CSF regime reduces the regulatory requirements for public fundraising and the intermediaries will play an important oversight role in this process.

For companies to access the benefits of the new CSF regime, ASIC must first license suitable intermediaries to provide crowd-funding services. Providers of CSF services must hold an Australian financial services (AFS) licence. From 29 September 2017 ASIC will begin accepting applications from potential CSF intermediaries for AFS licence authorisations to provide a crowd-funding service.

To facilitate implementation of this regime as soon as possible, ASIC’s Licensing team will consider applications from CSF intermediaries as a matter of priority.

These arrangements relate only to applications for AFS licence authorisations and do not apply in connection with applications for Australian Market Licences. ASIC says that CSF intermediaries or other entities seeking to offer secondary trading would typically require an Australian Market Licence: see ASIC's draft revised Regulatory Guide 172 Financial markets: Domestic and overseas operators. For background information, refer to our Breaking News for 20 July 2017.

ASIC has also released an update to ASIC Form 206 which can be used to convert an existing company so that it is eligible to use the new CSF regime. ASIC will now accept lodgement of ASIC Form 206.

For further information refer to ASIC's website.

Professional indemnity insurance review completed
29 August 2017

A targeted review of professional indemnity (PI) insurance by ASIC has found that most small companies holding Australian financial services (AFS) licences had PI insurance that met regulatory requirements. ASIC found, generally, the small AFS licensees that ASIC reviewed had policies with an overall indemnity limit that complied with requirements.

The review focused on the adequacy of cover for defence (legal) costs, and fraud and dishonesty, in the policies offered by two insurance companies to small AFS licensees. It followed on from ASIC's Report 459 Professional indemnity insurance market for AFS licensees providing financial product advice, December 2015 (REP 459), which highlighted these as areas of concern.

ASIC has revised Regulatory Guide 126 Compensation and insurance arrangements for AFS licensees to clarify that fraud cover is not required by licensees that are single person companies.

For further information refer to ASIC's website.

Overhauling the dispute resolution framework
26 July 2017

The Government has today announced it has established a transition team to bring the Australian Financial Complaints Authority (AFCA) into being. AFCA is designed to provide a 'one-stop-shop' for external dispute resolution, as recommended both by the Ramsay Review and the report of the Small Business and Family Enterprise Ombudsman.

The transition team has been tasked with ensuring that AFCA is operational by 1 July 2018. The transition team will advise the Government on AFCA’s terms of reference, governance and funding arrangements. It will also make recommendations on the authorisation process for AFCA and the transitional arrangements required to appropriately settle the cases currently before the three existing schemes.

For further information refer to the Treasury website.

ASIC consults on revised licence regime for domestic and overseas market operators
20 July 2017

ASIC has today released a consultation paper on proposals to refine and update ASIC’s regulatory guidance on the licensing regime for financial markets.

Consultation Paper 293 Revising the market licence regime for domestic and overseas operators (CP 293) proposes introducing a two-tiered market licence regime, based on a risk-based assessment. The second tier of licence will be able to facilitate a range of market venues, including specialised and emerging market venues. The consultation paper also:

  • proposes updating and clarifying the guidance about how licensees may comply with specific licence obligations;
  • proposes consolidating Regulatory Guide 177 (overseas market licensees) into the updated Regulatory Guide 172;
  • sets out the relevance of the proposals for secondary trading in shares of eligible crowd sourced funding companies; and
  • addresses implementation and transition matters.

The proposals follow the passage of the Corporations Amendment (Crowd-sourced Funding) Act 2017 (Crowd Sourced Funding Act), which amended Chapter 7 of the Corporations Act 2001 relating to the market licence regime.

Submissions are due by 31 August 2017.

For further information refer to ASIC's website.

Government to review Investment Manager Regime and amend AMIT rules
19 July 2017

The Government has today announced that it would consult on whether a legislative amendment is required to the Investment Manager Regime (IMR) to ensure that the engagement of an Australian independent fund manager will not cause a fund that is legitimately established and controlled offshore to be an Australian resident. Any legislative amendment would be retrospective to apply from the start of the IMR regime in 2015.

The Government will also make a number of amendments to clarify the operation of the new tax system for managed investment trusts (MITs).

For further information refer to Treasury's website.

ASIC's cost recovery framework has been finalised
14 July 2017

ASIC’s cost recovery framework has been finalised, incorporating changes made after broad industry consultation. The framework, outlined in Report 535 ASIC cost recovery arrangements: 2017–18, identifies industry sectors and provides a methodology for how the levies will be calculated.

As a result of legislation passed on 15 June 2017, industry funding will see regulated entities share the costs of ASIC’s regulatory services for their sector. The first invoices will be issued in January 2019 and will recover costs for regulatory services for the 2017–18 financial year.

For further information refer to ASIC's website.

ASIC remakes 'sunsetting' class order on credit union member shares
11 July 2017

ASIC has today remade Class Order [CO 02/1176] Credit union member shares in ASIC Corporations (Credit Union Member Shares) Instrument 2017/616. [CO 02/1176] was due to expire (‘sunset’) on 1 April 2018.

The new instrument continues relief from:

  • financial services licensing and disclosure requirements for the provision of financial product advice in relation to the issue of 'member shares'; and
  • the requirement to give information to members confirming the issue or redemption of these kinds of shares.

The relief was remade following public consultation via Consultation Paper 283 Remaking ASIC class order on credit union member shares: [CO 02/1176] (CP 283), issued in May 2017.

For further information refer to ASIC's website.

ASIC consults on new client money reporting rules
11 July 2017

ASIC has today released a consultation paper proposing to make new client money reporting rules (client money rules) for Australian financial services (AFS) licensees that hold 'derivative retail client money' within the meaning of the Corporations Act.

The client money rules will impose record keeping, reconciliation and reporting requirements on AFS licensees that hold derivative retail client money. ASIC is proposing that the client money rules should apply to all derivative retail client money received by an AFS licensee, unless the client money relates to a derivative that is traded on a fully licensed domestic market, such as the ASX 24.

Consultation Paper 291 Reporting rules: Derivative retail client money (CP 291) seeks feedback on the proposed client money rules.

The proposals follow the passage of Treasury Laws Amendment (2016 Measures No. 1) Bill 2016 and the Corporations Amendment (Client Money) Regulations 2017. These reforms will prevent AFS licensees from withdrawing client money provided by retail derivative clients, and using it for the wide range of purposes currently permitted under the Corporations Act, including as the AFS licensee's own working capital.

The reforms also give ASIC the power to make new client money reporting rules to ensure greater transparency in relation to an AFS licensee's receipt and use of derivative retail client money.

The client money rules are proposed to commence on 4 April 2018, which is when the other client money reforms will take effect.

Submissions are due by Tuesday, 8 August 2017.

For further information (including to see a copy of the consultation paper) refer to ASIC's website.

ASIC remakes 'sunsetting' class orders relating to registered schemes
5 July 2017

ASIC has remade four class orders relating to registered managed investment schemes, which were due to expire ('sunset') in 2017 and 2018.

A new instrument, ASIC Corporations (Chapter 5C – Miscellaneous Provisions) Instrument 2017/125, replaces the following class orders:

  • Class Order [CO 98/50] Incorporating parts of other compliance plans, which was due to sunset on 1 April 2018;
  • Class Order [CO 98/1806] Related bodies corporate and external members of compliance committee, which was due to sunset on 1 October 2017; and
  • Class Order [CO 98/1808] Allowing constitutions to use Appendix 15A of the ASX Listing Rules, which was due to sunset on 1 October 2017.

Class Order [CO 98/60] Protecting class rights in a managed investment scheme, which was due to expire on 1 April 2018, has been remade as an amendment to existing Class Order [CO 09/552] Changing scheme constitutions: see ASIC Corporations (Amendment and Repeal) Instrument 2017/545.

The class orders were remade following public consultation under Consultation Paper 270 Remaking ASIC class orders on registered schemes.

For further information refer to ASIC's website. For background information, refer to our Breaking News for 14 October 2016.

ASIC commences consultation on proposed guidance on sell-side research
30 June 2017

ASIC has today released a consultation paper proposing guidance on managing conflicts of interest and handling material, non-public information by Australian financial services (AFS) licensees that provide sell-side research (CP 290).

The proposed guidance looks at the key stages of a capital raising transaction and provides specific guidelines on what AFS licensees should do to appropriately manage conflicts of interest at each stage of the process. It also sets out general guidelines for AFS licensees in the identification and handling of material, non-public information and for the structure and funding of research teams.

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Specifically, feedback is sought on proposals related to:

  • the identification and handling of material, non-public information;
  • the management of research conflicts during the capital raising process, including the preparation and production of investor education reports; and
  • the structure and funding of research departments.

Submissions are due by 31 August 2017.

For further information refer to ASIC's website.

ASIC extends relief excluding multifunds, superannuation platforms and hedge funds from the shorter PDS regime
29 June 2017

ASIC has today extended Class Order [CO 12/749] Relief from the Shorter PDS regime for one year. The class order relief was due to expire on 30 June 2017.

The class order provides interim relief, until 30 June 2018, to exclude multifunds, superannuation platforms and hedge funds from the disclosure requirements of the shorter Product Disclosure Statement (PDS) regime under Part 7.9 of the Corporations Regulations 2001.

For further information refer to ASIC's website.

ASIC clarifies its position on the use of 'independently owned' under s923A
27 June 2017

ASIC has today clarified its position on the use of restricted terms relating to the independence of financial advisers after seeking external legal advice on whether phrases such as 'independently owned' are restricted terms under s923A of the Corporations Act.

Section 923A provides that financial service providers can only use certain restricted words and expressions if they do not receive commissions, volume-based payments, or other gifts or benefits, and operate without any conflicts of interest. While words such as 'independent', 'impartial', and 'unbiased' are specified as restricted words in s923A, there was some uncertainty about whether words such as 'independently owned' were also restricted.

ASIC's position is that words such as 'independently owned', 'non-aligned' and 'non-institutionally owned', and other similar words or expressions, can be used only if a financial adviser satisfies the conditions set out in s923A. This means that if a financial adviser does not receive any commissions or volume-based payments, or other gifts or benefits and has no conflicts of interest or influence from any product issuer, then they can describe themselves as being 'independently owned'. However, if the financial adviser does receive commissions or operates with conflicts of interest, then they will not be permitted to use the term 'independently owned' or other like words or expressions.

ASIC will provide a facilitative compliance period of six months so that advice firms that do not satisfy the conditions in s923A can change websites and documents to remove terms such as 'independently owned', 'non-aligned' or 'non-institutionally owned'.

The facilitative compliance period will not extend to contraventions of s923A where the specified restricted terms 'independent', 'impartial', and 'unbiased' are used as ASIC considers that there has been no uncertainty about how s923A applies to them and ASIC will continue to take action against financial service providers for using these terms in breach of s923A.

ASIC will also update Regulatory Guide 175 Licensing: Financial product advisers – conduct and disclosure (RG 175) to give further guidance on how to comply with s923A.

For further information refer to ASIC's website.

ASIC seeks better compliance with asset-holding requirements in funds management and custodial services
22 June 2017

ASIC today released a report entitled 'Review of compliance with asset holding requirements' (REP 531). The report outlines ASIC's findings following an extensive review of compliance by custodians and responsible entities of managed investment schemes with the asset holding requirements imposed by ASIC Regulatory Guide 133 Managed investments and custodial or depository services: Holding assets (RG 133).

For further information refer to ASIC's website.

ASIC reports on conduct in funds management and makes recommendations for improved compliance
13 June 2017

ASIC has today released Report 528 Responsible entities' compliance with obligations: Findings from 2016 proactive surveillance program (REP 528). The report details the findings of ASIC's surveillance of responsible entities' compliance with their legal obligations. ASIC has made recommendations to improve responsible entities' compliance in line with a model ASIC has developed.

For further information refer to ASIC's website.

Amendments to ASIC Corporations (Recognised Accountants: Exempt Services) Instrument 2016/1151
30 May 2017

ASIC has today amended ASIC Corporations (Recognised Accountants: Exempt Services) Instrument 2016/1151 to address a clear regulatory anomaly.

These amendments mean that full AFS licensees are not disadvantaged in relation to advice on taxation issues compared to limited licensees (ie, those who are licensed to provide a limited range of financial services relevant to self-managed superannuation funds) or those without any AFS licence.

ASIC has also updated Information Sheet 216 AFS licensing requirements for accountants who provide SMSF services (INFO 216) to reflect the amended instrument.

For further information refer to ASIC's website.

ASIC Corporations (Amendment) Instrument 2017/0464
26 May 2017

The ASIC Corporations (Amendment) Instrument 2017/0464 was registered today on the FRLI. It amends the ASIC Corporations (Recognised Accountants: Exempt Services) Instrument 2016/1151 to enable full AFS licensees (and authorised representatives) with limited authorisations to provide exempt advice under reg 7.1.29(4) of the Corporations Regulations to retail clients on the tax implications of financial products which are not covered by an authorisation in their licence.

ASIC provides guidance on common issues in registration of managed investment schemes
24 May 2017

ASIC has today published Information Sheet 220 Managed investment schemes: Common registration issues (INFO 220) to better assist scheme operators in the preparation of scheme constitutions.

INFO 220 explains the common issues ASIC identifies in the content of managed investment scheme constitutions during the registration process, and discusses how ASIC addresses them. It covers issues with:

  • the definition of a scheme member;
  • fees and expenses;
  • member withdrawal from the scheme;
  • timeframes for withdrawal payment; and
  • independent final audit when the scheme is wound up.

For further information refer to ASIC's website.

ASIC consults on ‘sunsetting’ class orders about licensing relief for financial counselling agencies and rural financial counselling service providers
17 May 2017

ASIC today released Consultation Paper 282 Remaking ASIC class orders on financial counselling licensing relief (CP 282) proposing to remake three ASIC instruments relating to financial counsellors, which are due to expire between 1 October 2017 and April 2026.

ASIC proposes to:

  • remake, without significant changes, Class Order [CO 03/1063] Licensing relief for financial counselling agencies; and
  • remake as a single new instrument, without significant changes, Class Order [CO 11/926] Credit licensing exemptions for NGOs (non-government organisations) providing credit assistance to consumers and ASIC Credit (Financial Counselling Agencies) Instrument 2015/992.

CP 282 outlines the minor changes ASIC is proposing to make to ensure the relief applies in the intended way, in particular, clarifying the restrictions on the persons that may not receive payments.

For further information refer to ASIC's website.

External dispute resolution and complaints framework - draft legislation released
17 May 2017

The Government today released exposure draft legislation to give effect to the Ramsay Review recommendation to overhaul the financial system's external dispute resolution and complaints framework. These recommendations include the establishment of a one-stop shop for all financial disputes, including superannuation disputes. Submissions are due by 14 June 2017.

For further information (including to access copies of the draft legislation) refer to the Treasury website.

ASIC remakes 'sunsetting' class order on reporting requirements for Australian financial services licensees who are natural persons
26 April 2017

ASIC has today remade Class Order [CO 03/748] Reporting requirements under s989B in ASIC Corporations (Financial Reporting: Natural Person Licensees) Instrument 2017/307. [CO 03/748] was due to expire ('sunset') on 1 October 2017.

The new instrument continues relief for Australian financial services licensees who are natural persons from the requirement to include, in a profit and loss statement, any revenues and expenses that do not relate to the financial services business carried on by the licensee.

The relief contained in [CO 03/748] was remade without substantive changes following public consultation via Consultation Paper 278 Remaking ASIC class order on reporting requirements for AFS licensees who are natural persons (CP 278), issued in February 2017. ASIC did not receive any submissions in response to CP 278.

For further information refer to ASIC's website.

Self reporting of contraventions by financial services and credit licensees
11 April 2017

The Government has today released a positions paper on Self-reporting of contraventions by financial services and credit licensees by the ASIC Enforcement Review Taskforce.

The paper includes proposals:

  • intended to reduce ambiguity around whether a breach is significant and must be reported to ASIC by introducing an objective ‘reasonableness’ test;
  • intended to enhance accountability for licensees, and their employees and representatives, by expanding the class of reports that must be made to expressly include misconduct by individual advisers and employees;
  • to introduce new and heightened penalties for non-reporting, giving ASIC greater flexibility to impose a range of penalties in response to a failure to report;
  • to require ASIC to publish data on breach reports for major licensees; and
  • to introduce an equivalent reporting regime for credit licensees (who are currently subject only to annual compliance reporting).

Submissions are due by 12 May 2017. For further information refer to the Treasury website.

ASIC consults on establishing a Financial Services Panel
11 April 2017

ASIC has today released a consultation paper on its proposal to develop and implement a Financial Services Panel.

ASIC is proposing that the panel would be responsible for determining whether ASIC should ban individuals from the financial services and credit industries for misconduct. ASIC would select matters and refer them to the panel where they are significant, complex or novel. Over time, the range of matters on which the panel will make decisions may be expanded.

Submissions are due by 23 May 2017. For further information refer to the ASIC's website.

ASIC extends the relief provided for foreign collective investment schemes for two years
3 April 2017

ASIC has today extended Class Order [CO 04/526] Foreign collective investment schemes ([CO 04/526]) for two years. This class order was due to expire ('sunset') on 1 April 2017.

[CO 04/526] provides relief for collective investment schemes from the requirement to register as a managed investment scheme or obtain an Australian financial services licence where the relevant overseas regulatory regime delivers regulatory outcomes sufficiently equivalent to our own regulatory regime.

ASIC Corporations (Repeal and Transitional) Instrument 2017/271 extends the relief in [CO 04/526] in the same form for two years.

ASIC has extended this relief for two years so that it can review and consult on the policy settings of its relief in light of other regulatory developments, such as the Government’s announcement of the introduction of new collective investment vehicles, and implementation of the Asia Region Funds Passport regime.

ASIC will consult publicly on its relief for foreign collective investment schemes before 1 April 2019.

For further information refer to the ASIC's website.

ASIC repeals ‘sunsetting’ class order on FSG exemption for market-making services on a licensed market and makes other minor amendments
30 March 2017

ASIC has today made a new legislative instrument, ASIC Corporations (Amendment and Repeal) Instrument 2017/65, which repeals Class Order [CO 03/578] Financial Services Guide exemption for market-making services on a licensed market and makes minor amendments to other ASIC instruments.

CO 03/578 was due to expire (’sunset’) on 1 April 2017. ASIC have reconsidered the basis for the relief provided by CO 03/578 and whether the Corporations Act requires a market maker on a licensed market to be given an FSG in the absence of relief. ASIC has repealed CO 03/578 because ASIC has come to the view that the class order is not legally necessary.

For further information refer to the ASIC's website.

ASIC remakes 'sunsetting' class order providing relief to foreign financial services providers with a limited connection to Australia
29 March 2017

Following public consultation, ASIC has today temporarily remade Class Order [CO 03/824] Licensing relief for foreign entities with limited connection to Australian wholesale clients in the ASIC Corporations (Foreign Financial Services Providers – Limited Connection) Instrument 2017/182. The new instrument continues to provide licensing relief for foreign financial service providers with limited connection to Australia providing financial services to wholesale clients, for a period of 18 months. Class Order [CO 03/824] was due to expire ('sunset') on 1 April 2017.

The instrument has been remade following public consultation: see Consultation Paper 268 Licensing relief for foreign financial services providers with a limited connection to Australia (CP 268), released in September 2016. Allens made submissions in favour of continuing the exemption.

For further information refer to the ASIC's website.

ASIC establishes Financial Advisers Consultative Committee
29 March 2017

ASIC today announced the establishment of the Financial Advisers Consultative Committee (FACC). FACC will supplement ASIC's existing engagement with the financial advice industry by:

  • contributing to ASIC's understanding of issues in the financial advice industry, including those directly impacting on practising advisers;
  • improving ASIC's capacity to identify, assess and respond to emerging trends in the financial advice industry.

The members of the FACC are practising financial advisers with a range of skills drawn from the following areas:

  • investment;
  • insurance;
  • superannuation;
  • self-managed superannuation funds; and
  • digital financial advice.

The FACC will provide ASIC with views on a broad range of issues relating to the financial advice industry.

For further information refer to the ASIC's website.

ASIC releases guidance on risk management systems of responsible entities
27 March 2017

ASIC today released Regulatory Guide RG 259 Risk Management systems of responsible entities to provide additional guidance to responsible entities on ASIC's expectations for compliance with their existing obligation under the Corporations Act to maintain adequate risk management systems.

The guide is aimed at ensuring that the risk management systems of responsible entities, including minimum procedures and practices, are adaptable to changing market conditions and remain effective in identifying and managing risks on an ongoing basis.

For further information refer to ASIC's website.

Stapled Structures
24 March 2017

The Government has today released a consultation paper seeking stakeholder views on potential policy options in relation to stapled structures, the taxation of real property investments and the re-characterisation of trading income.

Closing date for submissions is Thursday, 20 April 2017.

For further information (including to see a copy of the consultation paper) see the Treasury website.

ASIC updates its guidance on conduct and disclosure obligations for financial advisers
22 March 2017

ASIC has updated Regulatory Guide 175 Licensing: Financial product advisers conduct and disclosure (RG 175) to reflect regulatory and legislative changes, including revisions to the Future of Financial Advice (FOFA) reforms.

As well as some minor changes to remove outdated references, RG 175 has been updated to reflect:

  • technical amendments to the FOFA reforms since the previous version of RG 175 was released;
  • recent amendments to clarify financial advisers’ record-keeping obligations in Class Order [CO 14/923] Record-keeping obligations for Australian financial services licensees when giving personal advice;
  • the application of the tax agent services regime in the Tax Agent Services Act 2009 to financial advisers who provide tax (financial) advice services from 1 July 2014; and
  • the relief available under ASIC Corporations (Facilitating Electronic Delivery of Financial Services Disclosure) Instrument 2015/647 to facilitate the delivery of disclosures by making the disclosure available digitally and notifying the client.

RG 175 has also been updated to state that while the best interests duty and the appropriate advice requirement introduced as part of the FOFA reforms are separate obligations, it is unlikely that advice which fails to meet the best interests duty will be appropriate. ASIC has included two examples to illustrate the process it applies in determining whether the best interests duty has been satisfied.

ASIC states that the updates to RG 175 are generally technical in nature and do not represent substantive policy changes.

For further information refer to ASIC's website.

ASIC consults on 'sunsetting' class order about licensing relief for trustees of wholesale equity schemes
15 March 2017

ASIC today released Consultation Paper 280 ASIC class order on wholesale equity schemes: Licensing relief for trustees – [CO 07/74] (CP 280) proposing to either remake or repeal ASIC Class Order [CO 07/74] Wholesale equity schemes: Licensing relief for trustees. This is due to expire (‘sunset’) on 1 October 2017.

This instrument grants relief to trustees of wholesale equity schemes from the requirement to obtain an Australian financial services (AFS) licence in the circumstances specified in the instrument.

Submissions to CP 280 are due by 13 April 2017.

For further information refer to ASIC's website.

ASIC releases new instrument for differential fees
14 March 2017

ASIC has today released a new legislative instrument regarding differential fees, replacing the class order due to expire (‘sunset’) on 1 April 2017.

ASIC has replaced Class Order [CO 03/217] with the new legislative instrument ASIC Corporations (Registered Schemes – Differential Fees) Instrument 2017/40 which:

  • expands the relief where a member acquires an investment under a switching facility that involved a withdrawal from a managed investment scheme operated by the responsible entity to also cover a switching facility that involves a withdrawal from a managed investment scheme operated by a related body corporate of the responsible entity; and
  • removes unnecessary relief where a member carries out transactions in relation to the scheme by electronic means.

Class Order [CO 03/217] has been repealed by ASIC Corporations (Amendment and Repeal) Instrument 2017/41.

Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 (Cth) registered on the FRLI
24 February 2016

The Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 was registered today on the FRLI. It amends the Corporations Act 2001 to require that certain financial advisers meet specified education and training standards and comply with a code of ethics.

ASIC updates its guidance on fee disclosure statements
22 February 2017

ASIC has today released an updated Regulatory Guide 245 Fee disclosure statements (RG 245) to reflect regulatory and legislative changes since the guide was first published, including revisions to the Future of Financial Advice (FOFA) reforms.

The fee disclosure statement (FDS) obligations require advice providers who have an ongoing fee arrangement with a retail client to provide the client with an annual FDS setting out information about:

  • the fees paid by the client;
  • the services provided to the client; and
  • the services that the client was entitled to receive.

This obligation is designed to help clients determine whether the ongoing fees they are paying are proportionate to the services they have received, or were entitled to receive.

As well as some minor changes to remove outdated references, RG 245 has been updated to:

  • reflect technical amendments to the FOFA legislation since the previous version of RG 245 was released; and
  • clarify that the three limited no-action positions that were previously taken by ASIC in respect of the obligations to prepare and give an FDS, are no longer available. These no-action positions were taken to assist the industry to make a smooth transition to meeting the FDS obligations, which have now been in force for some time.

For further information refer to ASIC's website.

ASIC consults on 'sunsetting' class order about reporting requirements for Australian financial services licensees who are natural persons
17 February 2017

ASIC today released a consultation paper proposing to remake ASIC Class Order [CO 03/748] Reporting requirements under s989B. This is due to expire (‘sunset’) on 1 October 2017.

This instrument grants relief to Australian financial services licensees who are natural persons from the requirement to include in a profit and loss statement any revenues and expenses that do not relate to financial services businesses carried on by the licensees.

ASIC has found this class order is operating effectively and efficiently, and continues to form a necessary and useful part of the legislative framework.

Consultation Paper 278 Remaking ASIC class order on reporting requirements for AFS licensees who are natural persons: [CO 03/748] (CP 278) outlines ASIC's rationale for proposing to remake [CO 03/748]. ASIC have published a draft ASIC instrument with CP 278.

Submissions to CP 278 are due by 20 March 2017.

For further information refer to ASIC's website.

For more see our News archive.

Acknowledgements
The following copyright notice applies to any information on this website that has been sourced from the website of the Australian Securities and Investments Commission:
ASIC – Australian Securities & Investments Commission. Reproduced with permission.