The Australian Financial Complaints Authority (AFCA) was announced by Treasurer Scott Morrison in May 2017 as a new, ‘one-stop shop’ external dispute resolution body for financial services, intended to replace the Financial Ombudsman Service, the Credit and Investments Ombudsman and the Superannuation Complaints Tribunal.
The legislation for its creation was subsequently passed by Senate in February 2018, and is scheduled to come into effect by 1 November 2018, with former Howard government minister Helen Coonan named as the body’s chair last week.
ASIC deputy chair Peter Kell said the release of today’s draft updates to Regulatory Guide 139 Oversight of AFCA will assist the regulator to negotiate the transition to the new dispute resolution regime.
“ASIC is issuing draft updated RG 139 now as we believe that clarity about ASIC’s policy approach at this stage of the transition will assist all stakeholders,” he said.
“It will also enable ASIC to take into account and respond to any emerging issues that arise during the transition period.”
The consultation period is open for five weeks, but will only address a “limited number of policy issues” regarding issues such as whether or not businesses will need “transitional relief from external dispute resolution disclosure obligations”.
ASIC will also conduct a separate consultation process regarding AFCA’s internal dispute resolution process within the legislation, however this will not commence until after the implementation of the AFCA regime.
The FPA last year cautioned that the new complaints body could stifle competition, and urged the Senate standing committee on economics to include a general consideration for the competitiveness and efficiency of financial services markets.
