ASIC Instrument for Employee Entitlement Schemes Requires AFS Licence by Sep 2026

ASIC News & Regulatory Updates

Published April 1st, 2026

Detected March 30th, 2026

Summary

ASIC has issued a new legislative instrument, ASIC Corporations (Employee Entitlement Schemes) Instrument 2026/199, which replaces existing relief for employee entitlement schemes. Scheme operators must apply for an Australian financial services (AFS) licence by September 1, 2026, and will receive conditional relief from certain provisions of the Corporations Act until their licence is granted.

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What changed

ASIC has replaced the ASIC Corporations (Employee redundancy funds relief) Instrument 2015/1150 with the new "ASIC Corporations (Employee Entitlement Schemes) Instrument 2026/199". This new instrument mandates that operators of employee entitlement schemes must apply for an Australian financial services (AFS) licence by September 1, 2026. While awaiting licence approval, operators will be granted conditional relief from managed investment, product disclosure, and hawking provisions under the Corporations Act.

Scheme operators must take immediate action to prepare for their AFS licence application, with a deadline of September 1, 2026. Failure to obtain an AFS licence by this date will result in non-compliance with the Corporations Act. The new instrument and updated guidance (INFO 295 and PF 209) will be effective from April 1, 2026, with transitional arrangements in place until an AFS licence is issued.

What to do next

Apply for an Australian financial services (AFS) licence by September 1, 2026.
Review ASIC Information Sheet 295 and Pro Forma 209 for updated policy approaches and licence conditions.
Ensure compliance with transitional arrangements until an AFS licence is granted.

Source document (simplified)

Newsroom

Print Share ASIC has made a new legislative instrument to reflect our updated policy approach for the regulation of employee entitlement schemes under the Corporations Act 2001 (Corporations Act).

ASIC Corporations (Employee Entitlement Schemes) Instrument 2026/199 replaces the existing relief, which expires on 1 April 2026. ****

Under the new instrument:

scheme operators are required to apply to ASIC for an Australian financial services (AFS) licence by 1 September 2026
conditional relief is given from the managed investment, product disclosure and hawking provisions of the Corporations Act, and
transitional arrangements apply until an AFS licence is granted by ASIC. More information about the relief available to scheme operators under the new instrument is outlined in ASIC Information Sheet 295 Employee entitlement schemes (INFO 295).

We will update standard licence conditions in Pro Forma 209 Australian financial services licence conditions (PF 209) and INFO 295 to reflect our policy approach and the new instrument in April 2026.

Background

The primary objective of an employee entitlement scheme is to fund benefits payable to employees upon termination of employment, or long-service leave entitlements.

Operators of these schemes are exempt from the AFS licensing, managed investment, and associated provisions of the Corporations Act under ASIC Corporations (Employee redundancy funds relief) Instrument 2015/1150 until 1 April 2026.