Article source: ASFL House, financial services lawyers
For many law firms, growth still means adding another generalist practice area, hiring more lawyers or pursuing a larger volume of matters.
That approach can work. But it is not the only path.
For firms already advising clients in fintech, funds management, payments, insurance, credit, investment or emerging financial products, financial services law may represent a more strategic growth opportunity.
The opportunity is not simply that financial services businesses need lawyers. They always have.
The opportunity is that regulated businesses increasingly need coordinated advice across licensing, product design, compliance, governance, commercial contracts, technology and risk. That creates the potential for deeper client relationships, recurring advisory work and stronger alignment between a firm’s technical capability and the commercial problems its clients are trying to solve.
Financial Services Regulation Is Becoming More Complex
The Australian financial services regulatory framework covers a broad range of activities, including financial product advice, dealing in financial products, operating managed investment schemes, providing custodial services, insurance-related activities and other regulated services.
Businesses carrying on a financial services business may need an Australian financial services licence unless an exemption applies or they operate as an authorised representative of another licensee. ASIC’s overview of AFS licensing provides the relevant starting point.
For businesses, the practical challenge is rarely limited to submitting a licence application.
They must also consider:
- Whether the proposed business model involves regulated financial services;
- Which financial products and services are relevant;
- The scope of required authorisations;
- Responsible manager competency and organisational competence;
- Compliance frameworks, policies and procedures;
- Financial resources and risk management;
- Disclosure and conduct obligations;
- Anti-money laundering and counter-terrorism financing requirements;
- Ongoing regulatory reporting and supervision.
The legal advice required therefore extends beyond a single transaction or document. It often sits across the entire operating model.
That creates an opportunity for firms with the right capability to become involved earlier, remain involved longer and advise at a more strategic level.
The Opportunity Is Not A Simple Licensing Practice
A firm does not create a meaningful financial services practice merely by adding an “AFSL” page to its website.
The work requires genuine technical depth and commercial understanding.
A client may begin by asking for help with an AFS licence application. But the underlying questions may include:
- Can the proposed product legally be offered in its intended form?
- Does the business need an AFSL, an ACL or another form of authorisation?
- How should the business structure its responsible manager and compliance functions?
- What obligations will apply once the licence is granted?
- How should the business respond to ASIC or AUSTRAC engagement?
- What changes require a licence variation or further notification?
- How should contracts, disclosures and internal controls reflect the regulatory model?
These questions often connect multiple areas of legal work.
A financial services client may also need assistance with corporate structuring, commercial agreements, employment arrangements, intellectual property, disputes, privacy, technology procurement, fundraising or transactions.
That creates legitimate cross-practice opportunities, provided the firm has the expertise and internal coordination to deliver them properly.
Recurring Advisory Work Can Be More Valuable Than One-Off Matters
Financial services businesses do not become unregulated once a licence is granted.
They must continue operating within the scope of their authorisations and manage their obligations as the business, products, personnel and distribution channels evolve.
This can create recurring needs around:
- Compliance framework reviews;
- Regulatory change;
- Licence variations;
- New products and business models;
- Responsible manager changes;
- Governance and risk management;
- Internal audits and remediation;
- Regulatory investigations;
- Distribution and disclosure arrangements;
- Ongoing legal and compliance support.
For a law firm, this changes the commercial relationship.
Instead of being engaged only for a discrete application, the firm may become part of the client’s ongoing operating infrastructure. The relationship becomes more embedded, and the firm gains a clearer understanding of the client’s business and risk profile.
That does not mean every client should be placed on a retainer. It does mean firms should assess whether their financial services capability can support longer-term, higher-trust relationships rather than remaining limited to individual matters.
Firms Should Build Around Existing Strengths
The strongest growth opportunities usually sit close to work the firm already does well.
A firm with established fintech clients may be well placed to expand into licensing, payments and regulatory technology.
A firm with investment management clients may be able to develop deeper capability across funds, financial product advice and governance.
A firm advising brokers, lenders or credit providers may identify adjacent opportunities involving financial services regulation, authorisations, compliance systems and enforcement risk.
The strategic question is not:
“How do we become a financial services law firm?”
The better question is:
“Which financial services problems are already appearing in the businesses we understand, and where can we develop a differentiated capability?”
That distinction matters.
A broad, unfocused financial services offering may be difficult to explain and even harder to execute. A focused practice built around a defined client group, problem set or industry can be easier to position, staff and grow.
Build The Capability Or Partner With Specialists
Law firms considering this opportunity generally have two paths.
The first is to build the capability internally. This may involve hiring lawyers with relevant experience, developing precedents and processes, investing in training and creating a clear internal ownership model for financial services work.
The second is to partner with specialist providers where the firm has a capability gap or where a matter requires deeper expertise than the firm currently holds.
Neither model is automatically superior.
Building internally can create stronger long-term control and integration. Partnering can provide speed, flexibility and access to specialist knowledge without requiring the firm to build every capability from scratch.
The important point is to be honest about the firm’s current depth.
Regulated financial services work is not an area where a firm should overstate its competence. Clients need practical advice that reflects the real regulatory consequences of their decisions.
Specialist providers such as AFSL House illustrate one way focused financial services legal and compliance capability can support regulated businesses across licensing, structuring and ongoing obligations.
The right external relationship should strengthen the firm’s client offering, not create confusion about who is responsible for the advice.
The Strategic Test For Law Firms
Financial services law may be a compelling growth area for firms that already have relevant clients, technical capability and a willingness to invest in long-term positioning.
But it should not be treated as a fashionable label or a simple marketing exercise.
A serious practice requires:
- Genuine regulatory knowledge;
- Clear client and industry focus;
- Reliable internal processes;
- Appropriate supervision and quality control;
- The ability to explain complex issues commercially;
- Strong coordination across practice areas;
- A realistic plan for developing talent and market credibility.
The firms best positioned to benefit will not necessarily be the firms making the loudest claims.
They will be the firms that understand the operating realities of regulated businesses and can help clients navigate the full lifecycle, from business model design and licensing through to ongoing compliance, growth and regulatory change.
For those firms, financial services law is not merely another practice area.
It can become a strategic platform for deeper client relationships, recurring advisory work and a more valuable position in the market.
