ASIC RG 105: AFS Licensing: Organisational Competence

This guide is for AFS licensees, and applicants for an AFS licence or a variation of their licence.

This guide does not cover the obligation to ensure that your representatives are trained and competent to provide the financial services covered by your AFS licence: see s912A(1)(f). To find out about that obligation, see Section E of Regulatory Guide 104 AFS licensing: Meeting the general obligations(RG 104). If your representatives provide financial product advice to retail clients, see also Regulatory Guide 146 Licensing: Training of financial product advisers (RG 146).

The guide states that "If you are an AFS licensee, you must maintain the competence to provide the financial services covered by your AFS licence: see s912A(1)(e) of the Corporations Act. We refer to this obligation as the ‘organisational
competence obligation’. This is because this obligation requires you to be competent at the organisational level"

What you need to do to comply:

The Corporations Act places responsibility on you to ensure that you maintain the competence to provide the financial services covered by your AFS licence.

What you need to do to comply will depend on the nature, scale and complexity of your business, including the size of your business, the financial services and products you provide, and the roles that individuals play in your business. However, this guide sets out our minimum expectations for demonstrating organisational competence.

At a minimum, you need to nominate responsible managers who:

(a) are directly responsible for significant day-to-day decisions about the ongoing provision of your financial services (see Section B);

(b) together, have appropriate knowledge and skills for all of your financial services and products (see Section B); and

(c) individually, meet one of the five options for demonstrating appropriate knowledge and skills (see Section C). RG 105.9 You also need to have measures in place to ensure that you maintain your organisational competence at all times: see condition 4 of the standard AFS licence conditio