The Australian Securities and Investments Commission (ASIC) has extended interim relief for actuaries from the requirement to hold an Australian financial services licence (AFSL) until 31 December 2006 while the Federal Government continues its consultation with industry on the application of the licensing provisions.
Relief has also been extended for issuers of general insurance products from dollar disclosure requirements until March 2007 while the Government considers the application of these requirements to general insurance PDSs.
Actuaries The extension of relief for actuaries is provided under ASIC Class Order [CO 06/469] Further transitional relief for actuaries. This will provide the Government further time to consider the application of the licensing regime to actuaries.
Under s911A of the Corporations Act 2001, a person who carries on a financial services business is required to hold an AFSL. Corporations Regulation 7.1.29 provides exemptions from the need to be licensed for certain classes of professional activities that would otherwise constitute a financial services business.
Actuaries have previously raised concerns that the categories of exemption from licensing may not apply to all aspects of their ordinary business. In response, ASIC issued Class Order [CO 03/1096] Actuaries to provide temporary relief until 30 June 2005 to certain types of actuaries from the need to hold an AFSL, while the details of any potential permanent exemption were determined by Government. This relief was then extended under Class Order [CO 05/680]
Transitional relief for actuaries. For further background information, please refer to Information Releases [IR 03/43]: ASIC provides temporary relief during period of consultation issued on 23 December 2003 and [IR 05/37]: ASIC further extends interim relief for actuaries issued on 30 June 2005.
General insurance products and dollar disclosure In 2005, ASIC granted transitional relief for issuers of general insurance products from the dollar disclosure requirements until 30 June 2006 under Class Order [CO 05/683] Dollar disclosure: further transitional relief. This extension followed the Government’s announced review of product disclosure statement (PDS) requirements for basic deposit products and general insurance products as part of the Refinements to Financial Services Regulation Proposals Paper (May 2005). Page 1 of 2
As a result of this review, the Government excluded basic deposit products from the PDS regime in December 2005, leaving non-basic and general insurance products under the PDS regime. However, the Government applied a modified PDS regime to issuers of general insurance products.
The Government is now reviewing the application of the dollar disclosure regime to general insurance products (see the Corporate and Financial Services Regulation Review, April 2006). Recognising the need for flexibility in compliance with dollar disclosure until a permanent position is developed, ASIC has extended transitional relief until 31 March 2007. The extension of relief is provided under Class Order [CO 06/476] Variation of Class Orders [CO 05/681] and [CO 05/683]. For further background information about the dollar disclosure requirements and issuers of deposit products, please refer to Information Release [06-20] ASIC helps simplify disclosure for deposit products issued on 20 June 2006.
For further information contact: Mark Adams Director, Policy and Research Telephone: 02 9911 2622 Mobile: 0402 428 025 Emma Forehan ASIC Media Unit Telephone: 03 9280 3354