ASIC Class Order [CO 14/923]

Administered by Department of the Treasury

Legislation au F2014L01237 Not in force Legislative Instrument

Legislation content

ASIC Class Order [CO 14/923]

About this compilation

 

Compilation No. 1

 

This is a compilation of ASIC Class Order [CO 14/923] as in force on 27 October 2016. It includes any commenced amendment affecting the legislative instrument to that date.

 

This compilation was prepared by the Australian Securities and Investments Commission.

 

The notes at the end of this compilation (the endnotes) include information

about amending instruments and the amendment history of each amended provision.

 

Australian Securities and Investments Commission

Corporations Act 2001—Paragraph 926A(2)(c)—Declaration

 

Enabling legislation

 

1. The Australian Securities and Investments Commission makes this instrument under paragraph 926A(2)(c) of the Corporations Act 2001 (the Act).

 

Title

 

2. This instrument is ASIC Class Order [CO 14/923].

 

Declaration

 

4. Part 7.6 of the Act (except Divisions 4 and 8) applies in relation to financial services licensees (and former financial services licensees) and authorised representatives (and former authorised representatives) as if Division 3 of that Part were modified or varied by, after section 912F, inserting the following section:

 

“912G Record-keeping: personal advice

 

(1) This section applies in relation to the provision of personal advice to a person (the client) as a retail client by a financial services licensee (the provider) or a representative (the provider) of a financial services licensee.

 

(2) The financial services licensee must ensure that records of the following matters are kept in relation to the provision of the personal advice:

 

(a) the information relied on and the action taken by the provider that indicates the provider has, in accordance with subsection 961B(1), acted in the best interests (the best interests duty) of the client in relation to the advice;

 

(b) if subsection 961B(2) is being relied on to prove that the best interests duty has been satisfied—the information relied on and the action taken by the provider that satisfies the steps in that subsection;

 

Note: The keeping of records that satisfy the record-keeping obligation in paragraph (b) will satisfy the record-keeping obligation in paragraph (a).

 

(c) the advice given, including the reasons why, under section 961G, it would be reasonable to conclude that the advice is appropriate to the client, had the provider satisfied the best interests duty;

 

(d) where the provider knows, or reasonably ought to know, that there is a conflict between the interests of the client and the interests of a person mentioned in any of the paragraphs in subsection 961J(1)—the information relied on and the action taken by the provider to indicate that the provider has given priority to the client’s interests when giving the advice.

(3) The financial services licensee must ensure the records required to be kept by this section:

(a) are kept for 7 years after the day the personal advice was provided to the client; and

(b) are accessible by the licensee at all times during that period in a way that enables the licensee to produce the records.

This obligation continues to apply even if the financial services licensee ceases to be a financial services licensee during the period that the records are required to be kept and accessible.

(4) If the provider is an authorised representative of a financial services licensee and the records required to be kept by this section are kept by the authorised representative, the authorised representative:

(a) must give the records to the licensee if requested by the licensee, provided the request is made:

(i) in connection with the obligations imposed on the licensee under this Chapter; and

(ii) within 7 years after the day on which the personal advice was provided to the client; and

(b) unless the records have been given by the authorised representative to the licensee—must keep the records for a period of 7 years after the day on which the personal advice was provided to the client.

This obligation continues to apply even if the authorised representative ceases to be an authorised representative of the financial services licensee during the period that the records are required to be given or kept.

(5) Nothing in subsection (4) limits the operation of subsections (2) and (3).

(6) This section does not apply to the provision of personal advice given in relation to a financial product in circumstances where the provider satisfies the duty in subsection 961B(1) in relation to the advice given in relation to the financial product if the provider takes the steps mentioned in paragraphs 961B(2)(a), (b) and (c).

(7) This section (other than paragraph (2)(d) and subsection (3) as it relates to that paragraph) does not apply to the provision of personal advice covered by either of the following circumstances:

(a) the provision of personal advice for which a Statement of Advice is not required to be given to the client;

(b) the provision of personal advice for which a record of the advice is kept in accordance with subsection 946B(3A).

 

5. The declaration in paragraph 4 of this instrument applies in relation to the provision of personal advice on or after 23 March 2015.

 

Interpretation

 

6. In this instrument:

 

personal advice has the meaning given by subsection 766B(3) of the Act.

 

 

 

Notes to ASIC Class Order [CO 14/923]

Note 1

ASIC Class Order [CO 14/923] (in force under s926A(2)(c) of the Corporations Act 2001) as shown in this compilation comprises that Class Order amended as indicated in the tables below.

Table of Instruments

Instrument number

Date of FRL registration

Date of commencement

Application, saving or transitional provisions

[CO 14/923]

18/9/2014 (see F2014L01237)

18/9/2016

 

2016/1006

26/10/2016 (see F2016L01647)

27/10/2016

-

Table of Amendments

ad. = added or inserted     am. = amended     LA = Legislation Act 2003    rep. = repealed     rs. = repealed and substituted

Provision affected

How affected

Para 3...........

rep. s48D LA

Paragraph 4 (notional subsections 912G(3), (4) and (5)) 

 

rs. [2016/1006]

Paragraph 4 (notional subsections 912G(6) and (7)) 

 

ad. [2016/1006]

 

Overview

ASIC Class Order [CO 14/923], enacted in 2014, was introduced to address the need for clearer record-keeping practices among financial services licensees and their representatives when providing personal advice to clients. This legislative instrument was enacted by the Australian Securities and Investments Commission (ASIC) under the Corporations Act 2001. The policy objective is to ensure that financial services licensees maintain comprehensive and accessible records of personal advice provided to clients, thereby facilitating compliance with the best interests duty and enhancing accountability. The order applies to personal advice given on or after 23 March 2015, ensuring that licensees and their representatives keep detailed records of the advice given, the information relied upon, and any actions taken to address conflicts of interest, for a period of seven years post-advice. This requirement aims to uphold the integrity and transparency of financial advice provided to clients, ultimately protecting their interests.

Scope and Application

The ASIC Class Order [CO 14/923] is a legislative instrument made under the Corporations Act 2001 by the Australian Securities and Investments Commission (ASIC). This class order applies to financial services licensees and authorised representatives who provide personal advice to retail clients. It modifies the Corporations Act to impose specific record-keeping obligations on financial services licensees and authorised representatives in relation to the provision of personal advice. These obligations include maintaining records of the information relied upon and actions taken to ensure the advice provided is in the best interests of the client, the advice given, and the steps taken to manage any conflicts of interest. The records must be kept for seven years and must be accessible to the licensee at all times. The order came into effect on 23 March 2015 and was amended by ASIC Class Order [CO 14/923] on 27 October 2016. Notably, the record-keeping requirements do not apply to certain types of personal advice where specific conditions are met, such as when a Statement of Advice is not required or when records are already kept in accordance with other provisions of the Act.

Key Provisions

The ASIC Class Order [CO 14/923] modifies the Corporations Act 2001 (the Act) to introduce specific record-keeping requirements for financial services licensees and authorised representatives when providing personal advice to retail clients. According to section 912G of the Act, as inserted by this Class Order, financial services licensees must keep detailed records related to the provision of personal advice. These records must include information about how the provider acted in the best interests of the client, the advice given, and any steps taken to manage conflicts of interest. The records must be kept for seven years and be readily accessible to the licensee. If the advice is provided by an authorised representative of a licensee, the representative must also keep these records for seven years or hand them over to the licensee if requested within that period. The Class Order imposes several obligations on financial services licensees and their authorised representatives. Firstly, they must ensure that comprehensive records are maintained for every instance of personal advice provided to a retail client. These records should detail the basis for the advice given, including how the provider ensured that the advice met the best interests duty and addressed any conflicts of interest. Secondly, the records must be kept in an accessible format for seven years, even if the licensee or authorised representative ceases to hold their respective positions during this period. Additionally, if an authorised representative holds the records, they must transfer them to the licensee upon request if the request is made within the seven-year period and pertains to the licensee’s obligations under the Act. Failure to comply with the record-keeping requirements set out in section 912G may result in significant legal consequences. While the Class Order does not explicitly outline specific penalties for non-compliance, breaches of record-keeping obligations under the Corporations Act can lead to civil penalties. For corporations, the maximum penalty can be up to $210,000 for a serious breach and $10,500 for a less serious breach. For individuals, the penalties can be up to $21,000 for a serious breach and $1,050 for a less serious breach. Additionally, non-compliance can attract criminal charges, which could result in fines and imprisonment, depending on the severity of the breach and the specific provisions of the Act that are contravened.

Legal classification tags

Area of Law
Corporate Law & Governance
Financial Services Regulation
Instrument
Legislative Instrument
Concepts
Definitions & Interpretation
Reporting & Disclosure Obligations
Compliance Obligations
Record-keeping Requirements

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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.