ASIC updates guidance in response to Better Financial Outcomes reforms

The Australian Securities and Investments Commission (ASIC) has issued new regulatory guidance and updated existing resources to align with reforms introduced under the Treasury Laws Amendments (Delivering Better Financial Outcomes and Other Measures) Act 2024 (DBFO Act).

ASIC reported that the guide aims to provide clarity for financial advisers and Australian Financial Services (AFS) licensees navigating the revised legal framework.

ASIC’s new regulatory materials include four information sheets and revisions to two key regulatory guides: Regulatory Guide 246: Conflicted and other banned remuneration (RG 246) and Regulatory Guide 175: AFS Licensing: Financial product advisers–Conduct and disclosure (RG 175).

The four new information sheets cover key aspects of the DBFO Act reforms:

• Information Sheet 286 (INFO 286): FAQs on Ongoing Fee Arrangements and Consents provides guidance for financial advisers on obtaining written consent from clients when entering into or renewing ongoing fee arrangements.
• Information Sheet 287 (INFO 287): FAQs on Non-Ongoing Fee Requests or Consents addresses the process of seeking client consent for non-ongoing fees charged to superannuation accounts.
• Information Sheet 291 (INFO 291): FAQs on Financial Services Guides (FSGs) and Website Disclosure explains how AFS licensees or representatives can use website disclosures instead of providing physical FSGs.
• Information Sheet 292 (INFO 292): FAQs on Informed Consents for Insurance Commissions clarifies requirements for obtaining client consent to avoid insurance commissions being deemed conflicted remuneration.

ASIC’s updates to RG 246 provide new guidance addressing amendments to conflicted remuneration rules under the DBFO Act. Updates to RG 175 have removed guidance on FSG obligations, which have been replaced by INFO 291.

ASIC has also made consequential updates to Regulatory Guides 126 and 138, as well as five information sheets (INFO 141, 228, 266, 267, and 274). These revisions aim to maintain consistency with the DBFO Act reforms, particularly around advice fee obligations effective from January 10, 2025 for new fee arrangements.

ASIC plans to release further guidance once additional legislative measures under the Government’s Delivering Better Financial Outcomes package are enacted. Consultations with industry stakeholders will precede any new updates.

For further details, visit the Delivering Better Financial Outcomes package page on ASIC’s website.