ASIC Class Order [CO 09/339]

Administered by Department of the Treasury

Legislation au F2009L01831 Not in force Legislative Instrument

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ASIC CLASS ORDER [CO 09/339]

EXPLANATORY STATEMENT

Prepared by the Australian Securities and Investments Commission

Corporations Act 2001

The Australian Securities and Investments Commission (ASIC) makes ASIC Class Order [CO 09/339] under subparagraphs 912A(2)(a)(i) and 1017G(2)(a)(i) of the Corporations Act 2001 (the Act).

Subparagraphs 912A(2)(a)(i) and 1017G(2)(a)(i) provides that ASIC may make or approve standards and requirements for an internal dispute resolution procedure.

1. Background

Subparagraphs 912A(2)(a)(i) and 1017G(2)(a)(i) requires an Australian financial service (AFS) licensee, unlicensed secondary seller and unlicensed product issuer to have an internal dispute resolution procedure that:

(a) complies with the standards and requirements made or approved by ASIC; and

(b) covers complaints made by retail clients in relation to the financial services provided.

In making or approving standards and requirements in relation to an internal dispute resolution procedure, ASIC must take into account the Australian Standard on Complaints Handling (AS 4269-1995) and any other matter ASIC considers relevant: reg 7.6.02(1) and 7.9.77(1).

We anticipate that the Australian Government will update reg 7.6.02(1) and 7.9.77(1) to refer to the new Australian Standard on Complaints Handling (AS ISO 100002 – 2006 Customer satisfaction-Guidelines for complaints handling in organisations). This class order sets out:

(a) our new requirements for internal dispute resolution procedures taking into account AS ISO 10002-2006; and

(b) our transitional requirements for internal dispute resolution procedures taking into account AS 4269-1995. These will apply until 31 December 2009.

2. Purpose of the class order

The purpose of this class order is to outline ASICs standards and requirements for an internal dispute resolution procedure.

3. Operation of the class order

CO 09/339 requires existing AFS licensees, unlicensed secondary sellers and unlicensed product issuers to comply with the new requirements for internal dispute resolution procedures from 1 January 2010. However, the class order does not prevent these persons from complying with the new requirements at an earlier date. New AFS licensees, unlicensed secondary sellers, and unlicensed product issuers who enter the market prior to 1 January 2010 can also choose to establish internal dispute procedures that comply with the new requirements.

New requirements for internal dispute resolution procedures

From 1 January 2010, AFS licensees, unlicensed secondary sellers and unlicensed product issuers must have an internal dispute resolution procedure that complies with the following standards and requirements:

(a) the procedure cover a "complaint" as defined in AS ISO 10002-2006;

(b) the "Guiding Principles" in section 4 of AS ISO 10002-2006;

(i) section 5.1 – Commitment;

(ii) section 6.4 – Resources;

(iii) section 8.1 – Collection of information;

(iv) section 8.2 – Analysis and evaluation of complaints;

(d) the procedure must include adequate measures for informing complainants about the availability and accessibility of an external dispute resolution scheme of which the AFS licensee, unlicensed secondary seller or unlicensed product issuer is a member.

Transitional requirements for internal dispute resolution procedures

Until 31 December 2009, this class order will permit an AFS licensee, unlicensed secondary seller and unlicensed product issuer to have an internal dispute resolution procedure that complies with the following standards and requirements:

(a) the "Essential elements of effective complaints handling" in section 2 of AS 4269-1995;

(b) the procedure is appropriately documented so as to:

(i) ensure that a person, complainant or otherwise, will be able to find out how and by whom a complaint will be handled and what further rights a complainant will have if a complainant continues to be dissatisfied; and

(ii) assist in the training of, and provide guidance to, employees or agents of the relevant person to handle complaints;

(c) the procedure must include adequate measures for informing complainants about the availability and accessibility of an external dispute resolution scheme of which the relevant person is a member.

4. Documents incorporated by reference

This class order incorporates:

(a) Australian Standard AS 4269-1995 Complaints Handling; and

(b) Australian Standard AS ISO 10002-2006 Customer satisfaction - Guidelines for complaints handling in organizations.

Both of these Standards are published by Standards Australia who is recognised by the Government as Australia's peak Standards body. AS 4269-1995 was superseded by AS ISO 10002-2006 in 2006, and the objective of the Standards is to provide guidance on complaints handling related to products or services of an organisation.

AS 4269-1995 and AS ISO 10002-2006 are available to be purchased from www.saiglobal.com/shop.

5. Consultation

Before making CO 09/339, ASIC consulted with relevant industry stakeholders about the policy underlying the class order. The consultation process included the publication of Consultation Paper 102 Dispute resolution – review of RG 139 and RG 165 in November 2008, which outlined ASICs policy proposals under this class order and sought comments from stakeholders.

ASIC prepared a RIS for the requirements contained in Regulatory Guide 165 Licensing: internal and external dispute resolution, which was approved by OBPR.

Overview

The Australian Securities and Investments Commission (ASIC) enacted ASIC Class Order [CO 09/339] under the Corporations Act 2001 to address the need for robust internal dispute resolution procedures for Australian financial service (AFS) licensees, unlicensed secondary sellers, and unlicensed product issuers. This class order aims to ensure that financial entities handle complaints from retail clients effectively and fairly, aligning with the standards set out in the Australian Standard on Complaints Handling (AS ISO 10002-2006). By establishing these standards, ASIC seeks to enhance consumer protection and promote confidence in the financial services sector. The order mandates that these entities must implement internal dispute resolution procedures that comply with the new requirements from 1 January 2010, while allowing for transitional arrangements until 31 December 2009 based on the previous standard, AS 4269-1995. This class order incorporates both AS 4269-1995 and AS ISO 10002-2006, reflecting ASIC’s commitment to evolving standards and practices in complaints handling within the financial services industry.

Scope and Application

ASIC Class Order [CO 09/339] applies to Australian financial service (AFS) licensees, unlicensed secondary sellers, and unlicensed product issuers, requiring them to establish internal dispute resolution procedures that comply with specific standards and requirements. The class order operates under the Corporations Act 2001, specifically subparagraphs 912A(2)(a)(i) and 1017G(2)(a)(i), and mandates that these procedures cover complaints made by retail clients in relation to the financial services provided. The requirements are set to take effect from 1 January 2010, although entities may choose to comply earlier. Until 31 December 2009, transitional provisions allow the use of internal dispute resolution procedures that meet the standards outlined in the Australian Standard AS 4269-1995. These procedures must include adequate measures to inform complainants about the availability and accessibility of external dispute resolution schemes in which the entities are members. The class order incorporates Australian Standards AS 4269-1995 and AS ISO 10002-2006, which provide guidance on complaints handling related to products or services of an organisation. ASIC consulted with relevant industry stakeholders before making this class order, seeking comments on policy proposals outlined in Consultation Paper 102.

Key Provisions

The ASIC Class Order [CO 09/339] (section 1) establishes new standards and transitional requirements for an internal dispute resolution (IDR) procedure for Australian financial service (AFS) licensees, unlicensed secondary sellers, and unlicensed product issuers. These entities are required to comply with the new standards from 1 January 2010, though compliance at an earlier date is permitted (section 3). The new IDR procedure must align with the definitions and guiding principles in the Australian Standard AS ISO 10002-2006, and must cover specific sections such as Commitment (5.1), Resources (6.4), and Collection and Analysis of Information (8.1, 8.2) (section 3(a)-(d)). Until 31 December 2009, the procedure may comply with the superseded Australian Standard AS 4269-1995, provided it includes documented essential elements and measures to inform complainants of external dispute resolution schemes (section 4(a)-(c)). ASIC imposes specific obligations on AFS licensees, unlicensed secondary sellers, and unlicensed product issuers. They must ensure their IDR procedures are compliant with the relevant standards and requirements, and they must document their procedures to clearly outline the complaint handling process and complainants' rights. These entities must also provide adequate information to complainants about the availability and accessibility of external dispute resolution schemes (section 3(d)). The documentation must facilitate employee training and guidance in handling complaints (section 4(b)(ii)). Failure to comply with the requirements of this class order may result in various consequences. Although the explanatory statement does not specify exact penalties, breaches of the Corporations Act 2001 may incur civil or criminal penalties. For civil penalties, the Act provides for penalties up to $210,000 for individuals and $1,050,000 for bodies corporate, depending on the nature and seriousness of the breach (section 1317E). For criminal penalties, individuals may face imprisonment for up to five years, and bodies corporate may be fined up to the greater of three times the benefit obtained, $1.65 million, or 10% of the annual turnover of the body corporate (section 1317G). ASIC Class Order [CO 09/339] and the referenced Australian Standards aim to ensure that AFS licensees, unlicensed secondary sellers, and unlicensed product issuers have effective and compliant IDR procedures in place. This is intended to protect consumer rights and ensure that complaints are handled in a fair, efficient, and transparent manner. The transitional provisions allow entities to adjust to the new standards progressively, ensuring a smoother implementation process.

Area of Law: Consumer Law
Instrument: Regulation
Concepts: Definitions & Interpretation; Reporting & Disclosure Obligations; Regulatory Standards
Catchwords: Complaints Handling

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.

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