This Gateway provides an overview of how financial services businesses are regulated in Australia. It outlines the registration and licensing requirements you may need to complete before operating a financial business in Australia.
Australian licences and registration differ depending on the business entity. One of the key decisions you will make before applying is your business structure.
Licences and registrations are not transferrable between legal entities, so you will need to make this decision before applying for licences and registrations.
In providing financial services in Australia, you may require more than one type of licence from more than one regulator depending on the nature of your business. This guide covers 5 major categories to demonstrate common licensing Gateways:
It is not intended to cover all possibilities. More than one of these Gateways may apply to your intended business.
Financial services regulation is technical and complex. This Gateway is intended to act as a starting point to assist you in finding the relevant information and to give you a starting point for discussion with advisors. This Gateway does not eliminate the need for professional advice and it is strongly recommended that you engage service providers to advise you on legal, compliance and tax matters.
This Gateway will guide you to the websites of the major regulators. Take the time to explore those sites thoroughly for more detailed information on requirements and regulation.
You may operate a financial service business under a number of different business structures. Business structures available in Australia include companies (the most common type), trusts, joint ventures, partnerships and sole traders. There are different legal and taxation requirements for different business structures. The regulations for particular financial services may require you to use a certain structure. Your legal adviser will assist you to determine the most appropriate structure for your situation.
Whether a business is 'carrying on business' in Australia will depend on certain legal principles and on the specific circumstances of the business. Where a business is in any doubt as to whether it may be ‘carrying on business’ in Australia it should seek legal advice.
ASIC has prepared "Regulatory Guides 121 Doing financial services business in Australia" to assist people or companies from overseas who propose to conduct a financial services business in Australia.
Read ASIC RG121 Doing financial services business in Australia
Applications to register an Australian company can be made through a number of service providers including accountants, lawyers and other advisers.
Read more about registering an Australian company on ASIC's website Read more about company names and use of company numbers in ASIC Regulatory Guide 13 ACN, ARBN and company namesA foreign company wishing to carry on business in Australia must be registered under Part 5B.2 of the Corporations Act 2001.
A foreign company is an incorporated body that is formed in an external territory of Australia or outside Australia. Some unincorporated bodies are also treated as a foreign company.
Once registered in Australia, foreign companies are required to lodge copies of financial statements with ASIC and notify ASIC when particular company details change.
Read about registering a foreign company on ASIC’s website
Applying for licensing and registration
Overview
How to Register
Superannuation is a compulsory retirement savings program for Australians. Employers are required to contribute to each employee’s superannuation fund. The compulsory contribution amount is based on 9 percent of the employee’s salaries and wages. Employees may also make voluntary contributions to their superannuation fund. On retirement, the employee is able to access their superannuation fund investment. Superannuation funds receive preferential taxation treatment to encourage retirement savings.
In other jurisdictions, comparable arrangements are known as pension funds.
Most superannuation in Australia is provided through a trust structure where trustees hold the superannuation assets in trust on behalf of members of the superannuation fund.
A superannuation fund is a fund that is an indefinitely continuing fund established for the purposes of providing a benefit on retirement. They are regulated differently from other managed investment schemes.
Superannuation funds are regulated by both the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC). The trustee requires authorisation from APRA and the superannuation fund requires registration with APRA. The trustee is also required to hold an Australian financial services licence (AFS licence) obtained from ASIC (see Step 2).
APRA supervises superannuation funds regulated under the Superannuation Industry (Supervision) Act 1993 (SIS Act) and Superannuation Industry (Supervision) Regulations 1994 (SIS Regulations).
Superannuation funds registered by APRA are known as registrable superannuation entities (RSEs). RSEs include:
The superannuation fund must be registered with APRA prior to commencing operations. The trustee must first have been granted a Registrable Superannuation Entity licence (RSE licence).
Companies and groups of individual trustees may apply for a licence to be a trustee. Groups of individual trustees are licenced as a group under one licence.
RSE licencees must comply with capital and net tangible assets, risk management, adequacy of resources and fitness and propriety. RSE licencees must also comply with prudential practices such a business continuity management and information technology security risk.
RSE licencees are required, under the Financial Sector (Collection of Data) Act 2001 (FSCODA), to provide data to APRA. Data requirements are defined in the Reporting Standards established under FSCODA and their reporting forms and instructions.
The application process involves the following steps:
APRA provides guidance on how to apply for an RSE licence and register an RSE on its website.
Read APRA Superannuation Licensing guidance material
Download the application kit for applying for a RSE licenceAPRA will have 90 days to assess an RSE licence application with the option of extending this assessment period by a further 30 days.
APRA must decide an RSE registration application within 21 days. APRA may request further information and may extend the time to decide an application by 7 days.
The Schedule of Fees for Superannuation is published on APRA's website. There is an application fee as well as ongoing levies.
