May 15, 2025
When the Regulator Comes Knocking — Are You Ready?
Regulatory requests are inevitable in the Australian financial services industry. Learn how to handle ASIC and AUSTRAC notices, protect your business and stay ahead of scrutiny.
Global fund managers are drawn to the Australian investor market because it’s large, well-established and active. However, many aren’t familiar with the local legal structures, licensing rules or which service providers they’ll need — and how these requirements shift when targeting different distribution channels.
Here are six key considerations for offshore fund managers seeking to explore the Australian market and where to access expert local advice.
If representatives visit Australia in a single trip to meet with wholesale clients — and only provide factual information — they won’t need an Australian Financial Services Licence (AFSL). This allows firms to assess market opportunities before committing to a licensing process.
You’ll need to limit meetings to wholesale clients and keep discussions factual (e.g., no product recommendations or financial product advice).
The Australian Securities and Investments Commission (ASIC) takes a fairly broad view on what constitutes ‘carrying on a financial services business’ in Australia. Multiple visits or conducting business in Australia on an ongoing basis generally requires either having an AFSL or relying on another exemption. This includes being regulated by a sufficiently comparable foreign regulator or working through a licensed partner in Australia.
If you plan to have a physical presence in Australia or undertake frequent onshore visits, seek early advice on licensing pathways.
At the time of writing, relevant licensing exemptions apply if:
The latter may require you to submit a specific relief application to ASIC. Speak with us and we can help you with the application.
Focus on established asset classes for smoother market entry. Keep updated with ASIC’s regulations if you’re working with crypto. Australia allows for various fund types, including:
However, the regulatory framework for crypto assets is still developing. While traditional fund offerings face minimal barriers, digital asset funds may encounter additional scrutiny or licensing complexity.
Investor classifications determine your regulatory risk and distribution options in Australia. Funds targeting wholesale clients are primarily exempt from disclosure, registration and reporting obligations. However, retail funds must formally register, prepare regulated disclosure documents and comply with stricter consumer protection regulations.
Define your target investors early and use this classification to build your fund structure and documentation. Speak to us for guidance.
Your choice of trustee or responsible entity (RE) is essential to how funds are governed — and your relationship with ASIC. Wholesale funds appoint a trustee to oversee operations and compliance. Retail funds must engage an RE, who takes on operational control and regulatory accountability.
It’s a good idea to engage a reputable local trustee or RE early. Ensure their service model, licensing status and approach to compliance align with your fund’s needs.
Entering the Australian market presents exciting opportunities. However, you must comply with a strict and enforced set of regulations.
Download our white paper, Building an Australian Funds Business: Your Questions Answered, via the link below to explore these concepts further, or contact PMC Legal for practical local legal advice.
