ASIC has provided Australian financial services and credit licensees additional targeted relief under the reportable situations regime in response to feedback from industry.
The new relief:
- exempts industry from reporting certain breaches of the misleading and deceptive conduct provisions, and certain contraventions of civil penalties
- extends the length of investigations that are reportable to ASIC from 30 days to 60 days
- clarifies that a report is taken to be lodged with ASIC, if a licensee has submitted a breach report to the Australian Prudential Regulation Authority (APRA) that contains all the information APRA has requested.
The relief reduces some of the reporting burden on industry while upholding the objectives of the regime. More substantial changes to the legislative framework are a matter for Government.
Licensees are reminded to ensure they have the systems and processes in place to identify, escalate, investigate, rectify and capture incidents and breaches as part of their general obligations.
Consultation feedback and ASIC's response
From 18 February 2025 to 11 March 2025, ASIC consulted publicly on giving targeted relief from the requirement to report certain breaches of the misleading and deceptive conduct provisions, and certain contravention of civil penalties.
ASIC received four confidential and nine non-confidential submissions from industry and industry groups. Industry broadly welcomed the relief, however, suggested some changes.
ASIC also received one confidential and two non-confidential submissions from individual consumers who were opposed to the relief on the basis that some licensees still engage in misconduct.
In response to feedback, we broadened the types of reports that are exempt by increasing:
- the time allowed for rectification (from when the breach first occurred) from 30 days to 60 days
- the number of impacted consumers from five to 10
- the total financial loss or damage to consumers from $500 to $1000.
If a breach satisfies all these thresholds, it is not deemed reportable to ASIC.
We did not accept some suggestions, including those requesting that not all conditions under the criteria should have to be met for relief to apply. For example, it is important that certain breaches are reported to ASIC, even if they have been rectified. Some of the suggestions also involved more substantial changes to the regime, which is a matter for Government.
In response to submissions about the time it takes to complete investigations and with some input from the ASIC Simplification Consultative Group, we decided to give relief so that only investigations ongoing for more than 60 days, instead of 30 days, are reportable to ASIC. This relief will reduce the reporting burden on industry so that if an investigation is completed within 60 days and no reportable situation is identified, a report does not have to be submitted, while still incentivising licensees to undertake timely investigations.
ASIC also undertook targeted consultation on our proposal to clarify that a report is taken to be lodged with ASIC, if a licensee has submitted a breach report to APRA that contains all the information APRA requests. We received two submissions that generally agreed with our proposal, subject to minor technical changes, some of which we adopted.
Background
The reportable situations regime requires licensees to promptly identify, fix and report potential misconduct. Compliance with the regime can help lift industry standards and in turn improve consumer outcomes. The regime also aims to increase regulatory intelligence for ASIC.
ASIC has undertaken extensive work to strengthen the operation of the reportable situations regime since its introduction in October 2021.
- On 27 April 2023, we released updated guidance for licensees in response to operational issues.
- On 24 September 2024, we extended relief from reporting certain breaches of the misleading and deceptive conduct provisions.
- On 4 December 2024, we published findings of our review into compliance with the regime, including prompts to help strengthen licensees' practices.
- On 18 February 2025, we began consultation on additional relief from reporting certain breaches of the misleading and deceptive conduct provisions, and certain contraventions of civil penalties (CS 16).
Related Links
- ASIC Corporations and Credit (Amendment) Instrument 2025/289
- Public submissions to the relief from reporting certain breaches of the misleading and deceptive conduct provisions (CS 16)
ASIC is Australia's corporate, markets and financial services regulator.
