AFCA Scheme Authorisation 2018

AFCA Scheme Authorisation 2018

made under the Corporations Act 2001

Compilation No. 04

Compilation date: 11 March 2026

Includes amendments up to: AFCA Scheme Amendment (2025 Measures No.1) Authorisation 2025

Prepared by The Treasury

About this compilation

This compilation

This is a compilation of the AFCA Scheme Authorisation 2018 that shows the text of the law as amended and in force on 11 March 2026 (the compilation date).

The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law.

Uncommenced amendments

The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on the Register (www.legislation.gov.au). The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the Register for the compiled law.

Application, saving and transitional provisions for provisions and amendments

If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes.

Modifications

If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the Register for the compiled law.

Self‑repealing provisions

If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.

Contents

1  Name 

3  Authority

4  Definitions

5  Authorisation of an external dispute resolution scheme as the AFCA scheme

6  Condition on authorisation – report to Minister about decisions to vary fees

7  Condition on authorisation – must seek recognition of the Australian Information Commissioner

8  Condition on authorisation – membership of the scheme is open to existing members of FOS and CIO

9  Additional condition

9A  Condition on authorisationexternal dispute resolution complaint not to be decided in certain circumstances

10  COVID-19 economic response—guarantee of lending to small and medium enterprises

11  COVID-19 economic response—deferral of loan repayments

Endnotes

Endnote 1—About the endnotes

Endnote 2—Abbreviation key

Endnote 3—Legislation history

Endnote 4—Amendment history

1  Name

  This instrument is the AFCA Scheme Authorisation 2018.

3  Authority

  This instrument is made under subsections 1050(1), 1050(4) and 1050(5) of the Corporations Act 2001.

4  Definitions

Note:  Expressions have the same meaning in this instrument as in the Corporations Act 2001 as in force from time to time—see paragraph 13(1)(b) of the Legislation Act 2003.

  In this instrument:

Act means the Corporations Act 2001.

AFC means the Australian Financial Complaints Limited (ACN: 620 494 340).

AFCA Decision Maker has the same meaning as in the scheme rules.

AFCA scheme means the external dispute resolution scheme referred to in section 5.

Australian credit licence has the meaning given by National Consumer Credit Protection Act 2009.

Business Loan means a loan provided to a small business (as defined in the scheme rules) which was not regulated under Chapter 3 of the National Consumer Credit Protection Act 2009 at the time the loan was made.

CIO means the Credit and Investments Ombudsman Limited (ACN 104 961 882).

credit facility has the meaning given by the Corporations Regulations 2001 for the purposes of subparagraph 765A(1)(h)(i) of the Act.

dealing has the meaning given by section 766C of the Act.

FOS means the Financial Ombudsman Service Limited (ACN 131 124 448).

Privacy Act means the Privacy Act 1988.

scheme rules means the Australian Financial Complaints Authority (AFCA) Complaint Resolution Scheme Rules.

SMEG Act means the Guarantee of Lending to Small and Medium Enterprises (Coronavirus Economic Response Package) Act 2020.

SMEG Loan means a loan covered by a guarantee granted by the Commonwealth under the SMEG Act.

5  Authorisation of an external dispute resolution scheme as the AFCA scheme

  The external dispute resolution scheme operated by AFC is an authorised external dispute resolution scheme for the purposes of subsection 1050(1) of the Act and will be known as the AFCA scheme.

Note: The operator of the AFCA scheme will be known as AFCA.

6  Condition on authorisation – report to Minister about decisions to vary fees

  It is a condition relating to the authorisation of the external dispute resolution scheme that within 30 days after the end of each financial year that AFC must report to the Minister on any decisions taken during that financial year to do any of the following:

 (a) vary the amount of member levies payable by members of the AFCA scheme;

 (b) vary the scale of complaint fees payable by members of the AFCA scheme.

7  Condition on authorisation – must seek recognition of the Australian Information Commissioner

  It is a condition relating to the authorisation of the external dispute resolution scheme that AFC must take all reasonable steps required to obtain the Information Commissioner’s recognition of the authorised external dispute resolution scheme in accordance with section 35A of the Privacy Act.

8  Condition on authorisation – membership of the scheme is open to existing members of FOS and CIO

 (1) It is a condition relating to the authorisation of the external dispute resolution scheme that the Constitution of AFC must enable an entity covered by subsection (2) to apply to become a member of the authorised external dispute resolution scheme.

 (2) An entity is covered by this subsection if:

 (a) the entity is a member of an external dispute resolution scheme operated by FOS or CIO at the time this authorisation is made; and

 (b) the entity is required to be a member of a recognised external dispute resolution scheme under Part IIIA of the Privacy Act.

9  Additional condition

 (1) It is an additional condition relating to the authorisation of the AFCA scheme that the AFCA scheme must permit an eligible person to make a complaint if:

 (a) the complaint relates to a compulsory member of the AFCA scheme who is a member of the AFCA scheme at the time the complaint is made; and

 (b) the complaint is not an excluded complaint; and

 (c) the complaint is not otherwise excluded by the scheme rules (other than because of a time limit in the scheme rules); and

  (d) the complaint is made under the AFCA scheme within the period referred to in subsection (2).

 (2) The period for making the complaint is any time during the period starting on 1 July 2019 and ending on 30 June 2020.

Note: The period in subsection (2) does not apply to complaints that can otherwise be considered by the AFCA scheme.

 (3) If a complaint is made under the AFCA scheme in accordance with subsection (1), the complaint must be determined in accordance with the scheme rules as in force at the date this instrument commences.

 (4) In this section:

compulsory member means a person who is required to be a member of the AFCA scheme under a law of the Commonwealth.

eligible person has the same meaning as in the scheme rules.

excluded complaint means any of the following:

  (a) a complaint about conduct that occurred and ended before 1 January 2008;

 (b) a complaint in relation to which a decision or determination has been made by a court or tribunal;

 (c) a complaint in relation to which a decision or determination about the merits of the complaint has been made under a predecessor scheme or the AFCA scheme;

 (d) a complaint in relation to a superannuation death benefit;

 (e) a complaint that solely relates to a right or obligation arising under the Privacy Act 1988;

 (f) a complaint that has previously been finally settled by the person making the complaint and the compulsory member to whom the complaint relates (other than a complaint which can still be made under the scheme rules).

predecessor scheme has the same meaning as in the scheme rules.

small business has the same meaning as in the scheme rules.

9A  Condition on authorisationexternal dispute resolution complaint not to be decided in certain circumstances

 (1) It is a condition relating to the authorisation of the external dispute resolution scheme that the AFC and AFCA Decision Maker must not make a decision in relation to a complaint made under the scheme where all of the following are satisfied:

 (i) the decision would require a member of the scheme, who is the subject of the complaint, to pay an amount to a person (whether or not the member still exists); and

 (ii) the AFC and AFCA Decision Maker reasonably believe, having regard to the member’s financial position (if the member still exists), that the member is unlikely to fully pay the amount in accordance with the decision;

 (b) the complaint relates in whole or in any part to one or more of the following:

 (i) engaging in a credit activity (within the meaning of the National Consumer Credit Protection Act 2009);

 (ii) providing financial product advice that is personal advice provided to a person as a retail client about one or more products that include at least one relevant financial product (within the meaning of Part 7.6 of the Act);

 (iii) dealing in securities for a person as a retail client, other than issuing securities;

 (c) at the time the member of the scheme provided, engaged in, or dealt in one or more of the products or services covered by paragraph (b), the member was not authorised to provide, engage in, or deal in any of those products or services under any of the following:

 (i) a financial services licence (as the licensee or as an authorised representative as the case requires);

 (ii) an Australian credit licence (as the licensee or as a credit representative as the case requires);

 (d) the AFC and AFCA Decision Maker do not reasonably believe that there are exceptional circumstances that require a decision in relation to a complaint being made.

Note 1: To avoid doubt, once the AFC or AFCA Decision Maker are satisfied the complaint is of a type for which they must not make a decision under this subsection, the AFC or AFCA Decision Maker need not take any further action in relation to the complaint.

Note 2: Where amendments to the scheme rules are needed as a result of this section, the amendments will need to be applied from the time this condition commences.

 (2) In determining under paragraph (1)(c) whether a member was authorised to provide, engage in, or deal in the product or service, disregard any limitations (other than those covered in a licence) placed on a representative by a licensee under an authorisation.

 (3) Subsection (1) applies to complaints made, but not decided, before this section commences and to complaints made after this section commences.

9B  Condition on authorisation—complaints about banks relating to scams

  It is a condition relating to the authorisation of the AFCA scheme that the AFCA scheme must permit a complaint to be made, in accordance with any requirements to be set out in the AFCA scheme rules, in relation to a bank carrying on a financial services business or engaging in credit activities, if:

 (a) the complaint relates to either:

 (i) an account opened, or credit facility made available, by the bank in the name of the complainant without the complainant’s consent, authorisation or authority; or

 (ii) a receipt, internal movement, or external transfer, of funds by the bank, where the funds relate to the complainant; and

 (b) the bank is a member of the AFCA scheme at the time the complaint is made; and

 (c) the complaint relates to an attempt by someone to deceive the bank or the complainant (whether or not successful).

10  COVID-19 economic response—guarantee of lending to small and medium enterprises

 (1) It is an additional condition relating to the authorisation of the AFCA scheme that the AFCA scheme rules must include provisions consistent with subsections (2), (3), (4), (5) and (6) of this section.

 (2) Subsections (3) and (4) apply if:

 (a) a loan is made by a lender to a borrower and:

 (i) the loan is a SMEG Loan; or

 (ii) the lender believes in good faith that the loan is a SMEG Loan; and

 (b) the borrower makes a complaint to the AFCA scheme in accordance with the AFCA scheme rules in relation to any of the following:

 (i) the SMEG Loan;

 (ii) any other loan (to the extent that the loan is related to, or connected with, the SMEG Loan).

 (3) When considering the complaint, AFCA and the AFCA Decision Maker must not take into account any decision made by the lender which relates to:

 (a) a decision to provide the SMEG Loan to the borrower; or

 (b) the amount of the SMEG Loan.

 (4) In relation to decisions which AFCA and the AFCA Decision Maker can consider, they must consider the complaint on the basis that:

 (a) the lender was permitted to disregard the impact of COVID-19 when determining the financial situation of the borrower; and

 (b) the purpose of the SMEG Act is to encourage the quick and efficient provision of loans to borrowers as a response to the economic impact of COVID-19 on individuals, businesses and the Australian economy; and

 (c) the lender is required to comply with the terms of the SMEG Act (and any instruments, rules or conditions made as a consequence of that Act) in providing SMEG Loans to borrowers; and

 (d) the considerations in paragraphs (a) to (c) must be given priority by AFCA and the AFCA Decision Maker over other matters when making any preliminary assessment or determination.

 (5) The AFCA scheme must not consider systemic issues relating to SMEG Loans in relation to the decisions referred to in subsection (3), unless it becomes aware, in connection with a complaint under the AFCA scheme, that a serious contravention of a law may have occurred.

 (6) Any amendments to the AFCA scheme rules that are made as a result of this section must apply from the day after this instrument is registered.

11  COVID-19 economic response—deferral of loan repayments

 (1) It is an additional condition relating to the authorisation of the AFCA scheme that the AFCA scheme rules must include provisions consistent with subsections (2), (3), (4) and (5) of this section.

 (2) Subsection (3) applies if:

 (a) a Business Loan (other than a SMEG Loan) was made by a lender to a borrower on or before 1 January 2020 (Deferral Loan); and

 (b) the lender agrees to provide the borrower with a deferral of loan repayments in relation to the Deferral Loan, at any time in the period of 12 months after the date of commencement of this instrument, because the borrower has advised the lender that their business has been impacted by COVID-19 (Repayment Deferral); and

 (c) the borrower accepts, and makes use of, the Repayment Deferral; and

 (d) the borrower, or a person who was a guarantor in relation to the loan on or before 1 January 2020, makes a complaint to the AFCA scheme in accordance with the AFCA scheme rules in relation to a decision about a Repayment Deferral for the Deferral Loan.

 (3) The AFCA scheme must exclude any complaint, or part of a complaint, in relation to the decision to provide a Repayment Deferral and any consequential change to the amounts payable or guaranteed under the Deferral Loan or the duration of the loan or any guarantee of the Deferral Loan.

 (4) The AFCA scheme must not consider any systemic issues relating to decisions in relation to Repayment Deferrals referred to in subsection (3), unless it becomes aware, in connection with a complaint under the AFCA scheme, that a serious contravention of a law may have occurred.

 (5) Any amendments to the AFCA scheme rules that are made as a result of this section must apply from the day after this instrument is registered.

Endnotes

Endnote 1—About the endnotes

The endnotes provide information about this compilation and the compiled law.

The following endnotes are included in every compilation:

Endnote 1—About the endnotes

Endnote 2—Abbreviation key

Endnote 3—Legislation history

Endnote 4—Amendment history

Abbreviation key—Endnote 2

The abbreviation key sets out abbreviations that may be used in the endnotes.

Legislation history and amendment history—Endnotes 3 and 4

Amending laws are annotated in the legislation history and amendment history.

The legislation history in endnote 3 provides information about each law that has amended (or will amend) the compiled law. The information includes commencement details for amending laws and details of any application, saving or transitional provisions that are not included in this compilation.

The amendment history in endnote 4 provides information about amendments at the provision (generally section or equivalent) level. It also includes information about any provision of the compiled law that has been repealed in accordance with a provision of the law.

Misdescribed amendments

A misdescribed amendment is an amendment that does not accurately describe how an amendment is to be made. If, despite the misdescription, the amendment can be given effect as intended, then the misdescribed amendment can be incorporated through an editorial change made under section 15V of the Legislation Act 2003.

If a misdescribed amendment cannot be given effect as intended, the amendment is not incorporated and “(md not incorp)” is added to the amendment history.

Endnote 2—Abbreviation key

Endnote 3—Legislation history

Endnote 4—Amendment history