ASIC has issued a list of conduct and disclosure practices that it would like to see be adopted by participants within the sectors it regulates.
For the financial services sector this list includes:
acting professionally at all times
avoiding or properly managing conflicts of interest
treating investors fairly
ensuring that disclosure is timely and accurate, including when there is a change in control
designing and providing financial products and services that are appropriate for clients’/ investors’ needs
ensuring that clients/ investors are fully compensated when losses result from the poor practices and behaviour of licensees.
What this all means is putting your clients first. This requires having adequate financial and human resources. In the case of human resources, this may be achieved by outsourcing some of your functions, such as accounting or compliance.
ASIC has issued, and continues to issue, regulatory guides and information sheets. ASIC also conveys information about its intentions and interpretations of the law at seminars and conferences. Furthermore, ASIC has, in some instances, modified the law to suit particular classes of entities. These modifications are are called Class Orders.
Australia has quite a complex and challenging regulatory environment – for licensees, the public and for ASIC. It is not an easy task to understand regulatory requirements and to appreciate the regulator’s views on compliance. In part this is due to the fact that ASIC has to administer its laws across a wide spectrum of entities which offer a range of services and products.
All licensed entities are required to be aware which class orders, regulatory guides, information sheets and licence conditions in their licences apply to their operations.
Know Compliance can assist current and would-be licensees gain an awareness and understanding of ASIC’s regulatory requirements as they relate to individual licences.