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ASIC extends foreign financial service provider relief to Luxembourg

16 November 2016 | Australia, Europe
Legal Briefings – By Fiona Smedley and Steven Rice

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ASIC has granted conditional relief to financial services providers regulated in Luxembourg who wish to provide financial services to wholesale clients in Australia.

This relief is set out in ASIC Corporations Instrument (CSSF-Regulated Financial Services Providers) 2016/1109.

The relief has been granted in a similar form and for the same time period as ASIC Class Order CO [03/1099], which provides an exemption for UK financial services providers from the requirement of holding an AFS licence.

Under the relief, a Luxembourg fund manager (LFM) can seek an exemption from holding an AFS licence if it holds a current licence or authorisation which has been granted by the Commission de Surveillance du Secteur Financier (CSSF), the financial services regulator in Luxembourg, and if the LFM is:

  • a management company, which can manage undertakings for collective investment in transferable securities (UCITS) established under Part I of the Law dated 17 December 2010 relating to the undertaking for collective investment of Luxembourg (2010 Law) under to Chapter 15 of the 2010 Law; or
  • an investment company established under Part I of the 2010 Law that has designated itself as “self-managed”.

The relief only applies in respect of providing financial product advice, dealing in a financial product, making a market for a financial product or providing a custodial or depository service in respect of the following financial products:

  • eligible deposit products;
  • derivatives;
  • foreign exchange contracts;
  • securities;
  • debentures;
  • stocks or bonds issued by a government;
  • managed investment products; and
  • interests in a managed investment scheme that is not required to be registered under Chapter 5C of the Corporations Act 2001 (Cth).

ASIC has recently extended the relief provided to other foreign financial service providers (FFSP) under similar Class Orders including CO [03/1099]. This was to enable ASIC to review and consult on the policy settings underlying its relief in relation to FFSPs). ASIC released Consultation Paper 268 Licensing relief for foreign financial services providers with limited connection to Australia (CP 268) to seek feedback on these policy settings. Further information on ASIC’s consultation is available at Herbert Smith Freehills legal briefing.

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