Further 12 months extension for FFSP AFSL exemptions

On 31 July 2024, the Australian corporate regulator, ASIC, announced an extension of a further 12 months for the transitional arrangements for the current FFSP AFSL exemptions (the passporting exemptions and limited connection exemption) which will now expire on 31 March 2026. These FFSP exemptions were previously set to expire on 31 March 2025.

Background

• The passporting exemptions and limited connection exemption from the need to hold an Australian financial services licence (AFSL) that have been used by foreign financial services providers (FFSPs) since 2003 were due to expire on 31 March 2025 (see our earlier article of 8 August 2023). 
• In November 2023, a new bill was announced to introduce new exemptions from holding AFSLs for FFSPs (see our article of 30 November 2023) (Bill).
• In early 2024, the Senate Economics Legislation Committee considered the draft Bill (see our article of 16 February 2024). The Committee delivered its report on the draft Bill on 10 May 2024, which recommended the Bill be passed and noted there was “widespread support” for the AFSL exemptions for FFSPs (see our article of 10 May 2024).
• The Bill includes provisions unrelated to the FFSP exemptions. While the Government has stated its intention to implement the Bill, the timing of the finalisation of the Bill and its commencement date are unknown.

Update

On 31 July 2024, the Australian corporate regulator, ASIC, announced an extension of a further 12 months for the transitional arrangements for the current FFSP AFSL exemptions (the passporting exemptions and limited connection exemption). 

These exemptions will now expire on 31 March 2026, instead of 31 March 2025.

Next Steps

We will continue to monitor the status of the Bill.