The Australian Securities and Investments Commission (ASIC), which oversees financial services markets, has proposed certain relaxations in mandatory reporting requirements for regulated companies, including local contract for difference (CFD) brokers.
Four Mandatory Conditions
Announced today (Tuesday), the regulator proposed that Australian financial services and credit licensees be exempt from reporting if breaches meet all four of the following conditions:
- The company successfully rectifies the breach within 30 days of its first occurrence, including paying any necessary remediation.
- The breach impacts fewer than five consumers.
- The total loss due to the breach is less than AUD 500.
- The breach does not violate client money reporting rules or clearing and settlement rules.
“We are inviting feedback on our proposal to provide relief from reporting certain breaches of the misleading and deceptive conduct provisions and certain contraventions of civil penalties,” the regulator noted. It will accept industry feedback until the close of business on 11 March 2025.
The Australian regulator further highlighted that all locally regulated companies must have “systems and processes in place to identify, escalate, investigate, rectify, and capture incidents and breaches as part of their general obligations.”
Before finalising the rules, the regulator wants to assess their likely impact on compliance costs, competition, and other costs and benefits.
“Your feedback will not be treated as confidential unless you specifically request that we treat all or part of it (such as any personal or financial information) as confidential,” ASIC noted.
ASIC’s Tightening Regulatory Regime
ASIC regulates the broader financial services sector in Australia. The regulator has also introduced stricter compliance rules to enhance transparency and enforcement in financial communications.
The regulator also introduced the Design and Distribution Obligation (DDO) rules to ensure firms offer the right products to customers. It has taken action against dozens of companies, many of which are CFD brokers, for DDO breaches. Although most actions against brokers were limited to stop orders, the regulator sued eToro for DDO breaches.
Furthermore, the Australian regulator now seeks to mandate financial services licences for crypto businesses. In another order, the agency required buy now, pay later platforms to obtain credit licences.
The Australian Securities and Investments Commission (ASIC), which oversees financial services markets, has proposed certain relaxations in mandatory reporting requirements for regulated companies, including local contract for difference (CFD) brokers.
Four Mandatory Conditions
Announced today (Tuesday), the regulator proposed that Australian financial services and credit licensees be exempt from reporting if breaches meet all four of the following conditions:
- The company successfully rectifies the breach within 30 days of its first occurrence, including paying any necessary remediation.
- The breach impacts fewer than five consumers.
- The total loss due to the breach is less than AUD 500.
- The breach does not violate client money reporting rules or clearing and settlement rules.
“We are inviting feedback on our proposal to provide relief from reporting certain breaches of the misleading and deceptive conduct provisions and certain contraventions of civil penalties,” the regulator noted. It will accept industry feedback until the close of business on 11 March 2025.
The Australian regulator further highlighted that all locally regulated companies must have “systems and processes in place to identify, escalate, investigate, rectify, and capture incidents and breaches as part of their general obligations.”
Before finalising the rules, the regulator wants to assess their likely impact on compliance costs, competition, and other costs and benefits.
“Your feedback will not be treated as confidential unless you specifically request that we treat all or part of it (such as any personal or financial information) as confidential,” ASIC noted.
ASIC’s Tightening Regulatory Regime
ASIC regulates the broader financial services sector in Australia. The regulator has also introduced stricter compliance rules to enhance transparency and enforcement in financial communications.
The regulator also introduced the Design and Distribution Obligation (DDO) rules to ensure firms offer the right products to customers. It has taken action against dozens of companies, many of which are CFD brokers, for DDO breaches. Although most actions against brokers were limited to stop orders, the regulator sued eToro for DDO breaches.
Furthermore, the Australian regulator now seeks to mandate financial services licences for crypto businesses. In another order, the agency required buy now, pay later platforms to obtain credit licences.
This post is originally published on FINANCEMAGNATES.
