ARTICLE · 13 DECEMBER 2023

ASIC's appeal on conflicted remuneration case is dismissed: key takeaways

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Licensees who provide retail financial product advice should consider these court comments about conflicted remuneration.

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Olga Veselovskaia

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The Federal Court has clarified some issues regarding conflicted remuneration. These clarifying comments from the Court are important for licensees that provide retail financial product advice to consider.

No Real commercial advantage required – The Court reiterated the purpose of the conflicted remuneration regime is to prohibit benefits of any kind if (and only if) the benefits could reasonably be expected to influence the choice of financial product recommended or the advice provided by a licensee or its representatives. Thus, the benefit does not require the existence of a real commercial advantage after an assessment of any net benefits that may arise.
Single Financial product – The Court noted the possibility of conflicted remuneration within the meaning of s 963A is not confined to circumstances where the licensee receiving the benefit is confronted with a choice of financial product to recommend or a choice of financial product advice to give. It

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