The Australian Securities and Exchange Commission has extended the transitional relief for foreign financial services providers (FFSPs) from the requirement to hold an Australian financial services (AFS) licence for 12 months to 31 March 2013.
The Government announced that as part of the Federal Budget released on 11 May 2021, it will consult on options to restore regulatory relief for FFSPs who are licensed and regulated in jurisdictions with comparable financial service rules and obligations or have limited connection to Australia, from holding an AFS licence. It will consult on creating a fast-track licensing process for FFSPs who wish to establish more permanent operations in Australia.
ASIC Corporations (Amendment) Instrument 2021/510 extends the relief contained in these instruments:
- ASIC Corporations (Repeal and Transitional) Instrument 2016/396;
- ASIC Corporations (CSSF-Regulated Financial Services Providers) Instrument 2016/1109; and
- ASIC Corporations (Foreign Financial Services Providers—Limited Connection) Instrument 2017/182.
These aforementioned instruments currently apply to a range of FFSPs until 31 March 2022
The announcement stated:
The instrument also delays the commencement of the ASIC Corporations (Foreign Financial Services Providers—Funds Management Financial Services) Instrument 2020/199 until 1 April 2023. Under that instrument, ASIC gives licensing relief to some providers of funds management financial services to certain categories of Australian professional investors.
ASIC has temporarily stopped its assessment of the licence applications submitted by FFSPs as Treasury consults on the proposals affecting the licensing.
During the extended transitional period the Australian regulator “will consider new applications for individual temporary licensing relief or new standard or foreign AFS licence applications from entities that cannot rely on the transitional relief,” the announcement said.
The FFSPs which obtained a foreign AFS licence will be able to continue their financial services operations in Australia under the licence issued by ASIC pending any legislative changes arising from the Government’s consultation.
The Australian Competition & Consumer Commission (ACCC) recently published its 2020 report on scam activity in Australia, reporting 444,164 scams were recorded by different government agencies. The ACC found that Australians lost over $850 million to scams, of which a total of $328 million were lost to investment scams.
