ASIC Releases Guide To Section 912D Corporations Act

Section 912D of the Corporations Act 2001 is an important self reporting obligation that is imposed on all entities that hold an Australian Financial Services Licence (AFSL). ASIC has recently issued a document entitled 'Breach reporting by AFS licensees - An ASIC guide' (Guide), that provides some guidance about how ASIC will administer section 912D and what ASIC expects licensees to do. A number of ASIC's views are likely to be controversial.

Under section 912D, if:

• a licensee breaches (or is likely to breach) an obligation that is imposed on one of those entities as a result of holding its AFSL, and

• that breach (or likely breach) is significant having regard to a number of factors, the licensee must provide a written report to ASIC within five business days of becoming aware of the breach (or the likely breach).