Australia financial regulator ASIC has announced that it is extending – for a further 12 months – the transitional relief for foreign financial services providers (FFSPs) from the requirement to hold an Australian financial services (AFS) licence when providing financial services to Australian wholesale clients.

The licence exception does not apply to those entities that provide service to Australia retail clients.

The extension of the transitional relief to 31 March 2024 is made by ASIC Corporations (Amendment) Instrument 2022/623.

The current transitional arrangements for ASIC’s sufficient equivalence relief and limited connection relief were due to expire on 31 March 2023, after an initial extension was made in June 2021.

The new relief instrument also delays the commencement of the ASIC Corporations (Foreign Financial Services Providers—Funds Management Financial Services) Instrument 2020/199 until 1 April 2024. Under that instrument ASIC gives licensing relief to some FFSPs that provide funds management financial services to certain categories of Australian professional investors.

During this extended transitional period, ASIC will consider new applications for individual temporary licensing relief, or new standard or foreign AFS licence applications, from entities that cannot rely on the transitional relief.

FFSPs that have been, or are granted a foreign AFS licence, will be able to continue to operate their financial services business in Australia under the licence issued by ASIC.