Australian Financial Services Licensing (AFSL) Forum

Home Forums Australian Financial Services Licensing (AFSL) Forum Opt-In: Wholesale/Sophisticated/Professional Investors

Viewing 3 posts - 1 through 3 (of 3 total)
  • Author
  • #4628 Reply


    Hi. I would appreciate any comments and clarification you may be able to provide regarding the current definitions of Wholesale/ Sophisticated/ Professional investor, and how they relate to Opt-In requirements. Many thanks.

    #4629 Reply

    David Court

    The opt-in requirement applies to ongoing service agreements that have been entered on or after 1 July 2013.  Under s962K of the Corporations Act 2001 (Cth), an AFS licensee or representative who enters into an ongoing fee arrangement with a client is required to give their client a written notice of renewal every two years.  This offers the client the opportunity to “opt in” within a 30 day period and renew that fee arrangement.  If the client fails to respond to the renewal notice or decides to opt out, the fee arrangement terminates.


    An ongoing fee arrangement can arise when an AFS licensee or representative gives personal advice to a retail client and fees are to be paid for more than 12 months.  The opt-in requirement only applies to financial advisers giving personal advice to retail clients and does not apply to wholesale clients.


    There are 5 eligibility tests for distinguishing between wholesale and retail clients. These tests are set out in our article at this link: The Legal Basis of the Wholesale / Retail Client Distinction.


    If you require further information on the above, please contact our financial services team.


    Author: David Court


    Co-contributor: Joanne Lee

    #4633 Reply


    Thank you. You have again delivered a concise and targeted response, which is greatly appreciated.

Viewing 3 posts - 1 through 3 (of 3 total)


Reply To: Opt-In: Wholesale/Sophisticated/Professional Investors

Your information:

<a href="" title="" rel="" target=""> <blockquote cite=""> <code> <pre class=""> <em> <strong> <del datetime="" cite=""> <ins datetime="" cite=""> <ul> <ol start=""> <li> <img src="" border="" alt="" height="" width="">

  • Free answers to common Financial Services Regulation (FSR), Consumer Credit and AML/CTF issues.

    Click here to join our LinkedIn group for responsible managers and compliance professionals.
  • Training

    Regulatory Compliance Training for Directors, Responsible Managers and Compliance Staff

    View Courses

  • Legal Advice

    Review your AFSL or ACL disclosure documents, conduct a licensee audit and more…

    Get Legal Advice

  • Compliance support

    The HN Hub – an online platform built to support Responsible Managers and Compliance Staff