Australia - Foreign Financial Services Providers Licensing Relief Extended.
Legal News & Analysis - Asia Pacific - Australia - Regulatory & Compliance - Banking & Finance
25 September, 2018
ASIC Consultation Paper 301: Foreign financial service providers.
What you need to know
ASIC has extended the current FFSP exemptions for an additional 12 months, until 30 September 2019. The extension applies to the FFSP exemption available to providers regulated in recognised offshore countries and also to the "limited connection" exemption under former Class Order 03/824.
ASIC's consultation on the FFSP exemptions
On 1 June 2018, ASIC released Consultation Paper 301: Foreign financial service providers (CP 301), which outlined its intentions to repeal the following licensing exemptions available to foreign financial service providers (FFSPs):
FFSP Class Order exemptions: Providers regulated in recognised offshore jurisdictions have been able to "passport" into Australia under the FFSP Class Order exemptions.
Limited connection exemption: The "limited connection" exemption has been traditionally relied on by offshore providers who do not have a place of business in Australia and who are not able to rely on the FFSP Class Order exemptions.
For further details on CP 301, see our Financial Services Update dated 2 June 2018 here.
Extension of FFSP exemptions
The FFSP exemptions were due to expire on 27 September 2018.
On 20 September 2018, ASIC made ASIC Corporations (Amendment) Instrument 2018/807, which extends the FFSP exemptions for an additional 12 months, until 30 September 2019.
ASIC has said that it extended the FFSP exemptions to allow further time to consult on its proposals in CP 301. It will consult with those who made submissions in response to CP301 over the coming months. See Ashurst's submissions to ASIC in relation to CP 301 here.
If ASIC implements its proposals, it is expected that the new licensing regime will commence on 1 October 2020, with transition commencing from 1 October 2019.
For further information, please contact: