Australia - ASIC Extends Relief For Foreign Financial Services Providers.
Legal News & Analysis - Asia Pacific - Australia - Regulatory & Compliance - Banking & Finance
3 October, 2018
ASIC has announced that the licensing relief for foreign financial services providers (FFSPs) has been extended to 30 September 2019 (Relief Extension Date). The licensing relief currently allows FFSPs to provide financial services to Australian wholesale clients without needing to hold an Australian financial services licence (AFSL).
The extension is in relation to the below licensing reliefs (which were previously due to sunset late September 2018):
1. Sufficient equivalence relief - exempts foreign providers from the requirement to hold an AFSL where they are regulated under overseas regulatory regimes that ASIC has assessed as sufficiently equivalent to the Australian financial services regimes; and
2. Limited connection relief - provides licensing relief to foreign providers with a limited connection to Australia providing financial services to wholesale clients. This relief covers a foreign provider inducing an Australian wholesale client to use the relevant financial services provided by the foreign provider.
ASIC is currently reviewing the 36 submissions received on its proposals to its Consultation Paper 301: Foreign financial services providers (CP 301) (noting submissions closed on 31 July 2018) to revoke the relief and introduce a modified licensing regime for FFSPs. CP 301 also proposes a further transition period of 12 months from the Relief Extension Date to 30 September 2020 if ASIC proceeds with the modified licensing regime. Essentially, there is now a minimum period of 2 years in which the current licensing reliefs can be relied upon.
For further background on the current licensing relief, CP 301 and the extension to the licensing reliefs, please see our client alert of June 2018 here.
For further information, please contact:
Bill Fuggle, Partner, Baker & McKenzie