ASIC told legislation trumps class orders

The Australian Securities and Investments Commission (ASIC) has been bluntly told that it should not be remaking class orders around the provision of financial advice when those issues should be dealt with in amendments to the Corporations Act.

The Association of Superannuation Funds of Australia (ASFA) has used ASIC’s consultation process around the remaking of class orders imposing specific record-keeping requirements on licensees to argue that it would be better legislated by the Government.

ASFA said that while it supported the existing record-keeping requirements in the ASIC Class Order, “we recommend matters relating to providing advice to retail clients would best be dealt with wholistically and in legislation, instead of temporary ASIC instruments, in view of the broader Quality of Advice reforms.”

The ASFA response went on to say that it “recommends consideration should be given to whether it is appropriate that such essential matters as record-keeping requirements for personal advice in the Corporations Act should continue to be dealt with via temporary ASIC instruments”.

“We note these record-keeping requirements have already been in place for almost 8 years, since 2016. Indeed, this consultation was only they necessitated because they were due to expire in October 2024, as they are contained in a temporary instrument,” the response said.

“ASFA recommends it would be more appropriate for Parliament to amend the Corporations Act directly, to make the requirements contained in section 912G permanent rather than temporary.