ASIC announces extension to transitional relief for foreign providers

ASIC has again extended the transitional relief for FFSPs from the requirement to hold an AFSL when providing financial services to Australian wholesale clients.

On Tuesday, the regulator noted that current transitional arrangements for sufficient equivalence relief and limited connection relief had been due to expire on 31 March next year.

This transitional relief has now been extended to 31 March 2024 through ASIC Corporations (Amendment) Instrument 2022/623.

ASIC’s new relief instrument also delays the commencement of another instrument until 1 April 2024, under which ASIC gives licensing relief to some FFSPs that provide funds management financial services to certain categories of Australian professional investors.

“During this extended transitional period, ASIC 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 regulator said.

“FFSPs that have been, or are granted a foreign AFS licence, will be able to continue to operate their financial services business in Australia under the licence issued by ASIC.”

ASIC previously announced a 12-month extension to the relief in June last year to await the outcome of the federal government’s consultation about the regulation of FFSPs.

In February this year, a bill was introduced to parliament which would have provided certain FFSPs with exemptions from the requirement to hold an AFSL. However, the legislation lapsed when parliament was dissolved in April ahead of the May federal election.

Jon Bragg

Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.