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      ASIC: Do end users have to comply with the derivative transaction rules (reporting)?

       

      An end user is a person who is not:

      • an Australian authorised deposit-taking institution (ADI) (as defined in Rule 1.2.3 (Reporting))
      • a clearing and settlement facility licensee (as defined in Rule 1.2.3 (Reporting))
      • an Australian financial services licensee (as defined in Rule 1.2.3 (Reporting)), or
      • a person:
        • who provides a financial service, relating to derivatives, only to wholesale clients, and
        • whose activities, relating to derivatives, are regulated by an overseas regulatory authority.

      Under the Corporations Act and the Corporations Regulations, end users do not have to comply with the reporting requirements.

      This is as a result of section 901D of the Corporations Act, which permits the Corporations Regulations to provide that the derivative transaction rules (reporting) cannot impose requirements on certain classes of persons. Regulation 7.5A.50 of the Corporations Regulations provides that:

      • the class of persons on whom the derivative transaction rules (reporting) cannot impose requirements includes end users (the end-user exemption), and
      • the derivative transaction rules (reporting) cannot impose requirements relating to a class of derivatives on Australian financial services (AFS) licensees, who are taken not to be end users only because they are AFS licensees and whose AFS licences do not authorise them to provide financial services in relation to that class of derivatives.

      (Updated 5 January 2015)