Where things stand
On 8 April 2026, the Treasury Laws Amendment (Genetic Testing Protections in Life Insurance and Other Measures) Bill 2025 (Bill) received Royal Assent. The Bill amends the Corporations Act 2001 (Cth) (Corporations Act) to include the following Australian financial services licence (AFSL) exemptions for foreign financial service providers (FFSPs).
Professional investor exemption
The professional investor exemption, introduced under the new section 911A(2)(eo) of the Corporations Act, exempts FFSPs from the requirement to hold an AFSL where, among other conditions, the FFSP:
- Provides financial services from outside Australia (except during limited marketing visits) to professional investors only.
- Has its head office and principal place of business outside Australia.
- Reasonably believes the financial service would not contravene any law in the places from which services are provided, its head office or principal place of business.
- Notifies ASIC before or within 15 business days after it begins providing the relevant financial service.
- Ensures, among other items, that financial services are provided efficiently, honestly, and fairly.
Comparable regulator exemption
The comparable regulator exemption, introduced under the new section 911A(2)(ep) of the Corporations Act, exempts FFSPs from the AFSL requirement where they provide financial services only to wholesale clients and are authorised by a comparable regulator to provide the same or substantially the same financial service. Among other conditions, the FFSP must:
- Consent to information sharing between ASIC and each comparable regulator.
- Notify ASIC of any significant enforcement action, disciplinary action or investigation undertaken against the FFSP by any regulator, government authority or financial market operator outside Australia.
- Have an agent in Australia (with a grace period of up to 10 business days if the position is vacant).
- Submit to the non-exclusive jurisdiction of Australian courts.
- Notify ASIC within 15 business days before or after it begins providing the relevant financial service.
- Ensure that financial services are provided efficiently, honestly, and fairly.
Other
The Bill also provides that the fit and proper person test does not apply to certain foreign entities applying for an AFSL that are only providing financial services to wholesale clients and are regulated for the same activities offshore.
What’s next
The FFSP exemption framework will commence on 9 April 2027. Eligible FFSPs can continue relying on limited connection, existing sufficient equivalence relief and individual relief linked to existing sufficient equivalence relief until 31 March 2027.
It is anticipated that ASIC will release further guidance on the new exemptions as well as any transitional arrangements.