ASIC extends transitional relief for Foreign Financial Services Providers – legislation back on the agenda

As we head into the holiday period, it seems that Foreign Financial Services Providers (FFSPs) hoping for clarity on the rules for selling financial products in Australia will need to wait a little longer. The much-anticipated regime remains subject to transitional rules only.

On 5 December 2025, ASIC extended the transitional relief for FFSPs for another 12 months, now running until 31 March 2027.  There’s still a chance legislation will pass before then, with the new FFSP legislation back on the agenda after being shelved last year. The draft law re-entered the legislative timetable on 26 November 2025 as part of the enigmatic "other measures" in the Treasury Laws Amendment (Genetic Testing Protections in Life Insurance and Other Measures) Bill 2025 (FFSP Bill), which largely mirrors the previous proposed legislation.

The FFSP Bill will introduce licensing exemptions for FFSPs that:

• provide financial services from outside Australia to professional investors only, and only by visiting Australia occasionally (professional investor exemption);
• are regulated by comparable regulators and that provide financial services to wholesale clients (comparable regulatory exemption); or
• provide financial services that involve making a market from offshore for derivatives that are able to be traded on a specified licensed market (market maker exemption).

For any FFSPs seeking to establish more permanent operations in Australia, the FFSP Bill also introduces a fast-track AFS licence application process.

Amongst the optimistic (or those confused about the legislative priorities of the Government), the FFSP Bill is expected to receive Royal Assent during 2026, with commencement scheduled for 12 months after that date.