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The Department of Home Affairs has issued its draft guidance “Modern Slavery Act 2018: Draft Guidance for Reporting Entities” (Draft Guidance) for the new Modern Slavery Act 2018 (Cth) (the Act).
In June 2018, the Australian Securities & Investments Commission (ASIC) issued an announcement affecting foreign financial services providers (FFSPs) that rely on “passport” class order relief or on “limited connection” relief from the requirement to hold an Australian financial services licence (AFSL) in order to provide financial services in Australia to wholesale clients. At the end of 2018, ASIC announced that it will be proceeding with the proposal to repeal passport relief and limited connection relief, and will implement a new regime which will require FFSPs to apply for a foreign AFSL.
Throughout 2018, ASIC conducted a consultation on the proposed modified licensing regime for FFSPs carrying on a financial services business in Australia (see our previous insight here). During the consultation period, ASIC extended the operation of the passport class order relief and limited connection relief to 30 September 2019, to allow sufficient time to review the consultation submissions and engage further with industry participants.
After reviewing the consultation submissions, ASIC has decided to proceed with the proposal for a new foreign AFSL regime and repeal:
Passport relief and limited connection relief will cease from 30 September 2019. FFSPs relying on either relief will have 12 months to transition to a foreign AFSL or satisfy licensing requirements in some other way.
ASIC plans to release in the first half of 2019 a draft Regulatory Guide and draft instruments relating to the foreign AFSL regime. We will provide a further update when this information is available.
Please be in touch should you wish to discuss.