ASIC reminds licensees of ongoing registration obligations
ASIC has reminded advisers that their registration requirements are an ongoing obligation, having met the first deadline on 16 February.
Advisers had to register with ASIC by 16 February as part of a new additional registration requirement in order to legally provide personal advice to retail clients in relation to relevant financial products.
This was originally scheduled to finish by 1 February but was extended by two weeks after it was found many advisers had not completed their registration due to the summer break.
The requirement was introduced by the Financial Sector Reform (Hayne Royal Commission Response—Better Advice) Act 2021, in response to Recommendation 2.10 of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
However, while they have completed their first iteration of the registration, ASIC reminded Australian financial services licensees (AFSLs) and relevant providers that the registration is an ongoing requirement and failure to do so may result in them being unregistered.
Unregistered relevant providers who provide personal advice to retail clients in relation to relevant financial products, together with their AFS licensee, will be in breach of the law and face potential regulatory action.
There are four circumstances where licensees must complete a new registration:
- After they authorise and appoint an adviser to the Financial Advisers Register.
- When they appoint an adviser who has moved from another AFS licensee.
- When an adviser changes roles from a “provisional relevant provider” to a “relevant provider”.
- When an adviser is dually authorised, and the adviser’s authorisation with their registering AFS licensee ceases.
On the other hand, a registration may cease from:
- The time a banning order begins which prohibits the relevant provider from providing personal advice.
- The cancellation time specified in a registration prohibition order.
- For relevant providers who are not AFS licensees, the time the registering AFS licensee ceases the relevant provider’s authorisation to provide personal advice.
- For self-licensed relevant providers, the time the AFS licence ceases to be in force.
ASIC said it will not usually provide a notice of cessation of registration to the relevant provider or their AFS licensee unless it is a registration prohibition order made by the Financial Services and Credit Panel (FSCP).
More information about the registration requirement is provided for advisers and licensees in Information Sheet 276.
AUTHOR
Laura Dew
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