Starting April 1, 2024: A New Requirement for FFSPs
Foreign financial service providers (FFSPs) will need a specific Australian license to offer services to wholesale clients in Australia from April 1, 2024. This license, known as the foreign Australian financial service licence (AFSL), marks a shift from the current passporting relief system.
Simplified Licensing for Global Providers
The foreign AFS Licence offers a streamlined process. It’s for FFSPs already authorised in their home countries. The Australian Securities and Investments Commission (ASIC) recognises these providers as having comparable regulatory standards.
Eligibility and Recognition
To qualify, a business must:
- Have authorisation in a home country that ASIC sees as having similar standards to Australia.
- Plan to serve only wholesale clients in Australia. Countries with recognised regulatory regimes include the USA, UK, Singapore, Germany, and several others.
Benefits and Simplified Obligations
The regime eases some standard obligations. For example, foreign AFS Licensees don’t need to notify ASIC of significant changes or ensure representative training. This change assumes their home country’s laws cover these areas. Yet, they must still follow other Australian laws.
Application Made Easier
Applying for this license is quicker and less complex. Applicants must meet eligibility criteria, provide necessary documents, and show they can comply with specific obligations.
Need More Information?
For further details on the foreign AFS Licensing regime or other business law matters, Strafurd York is here to help.
Reach out to us at info@strafurd.com.au or call 1300 158 066 for expert advice.
