Unless exempt, the following conduct may constitute ‘dealing in a financial product’:


(a) applying for or acquiring a financial product;


(b) issuing a financial product;


(c) for securities or managed investment schemes, underwriting the securities or interests;


(d) varying a financial product; or


(e) disposing of a financial product.


However, if a person is simply dealing on their own behalf (e.g. acquiring a financial product for themselves), this is not an activity that requires an Australian Financial Services (AFS)  licence, unless the dealing consists of issuing a financial product. Therefore, the main types of dealing regulated under the financial services laws are:


(a) dealing by a person on another’s behalf (e.g. as a broker or other intermediary); and


(b) issuing a financial product (including issuing a derivative).


Additionally, ‘arranging’ for a person to engage in the conduct described above will also generally constitute dealing in a financial product. An ‘arranger’ is an intermediary who may act for one or more parties to a dealing in a financial product. A person’s actions are likely to constitute  ‘arranging’ where there is a sufficient degree of connection between the intermediary’s actions and the completion of a transaction in respect of a financial product. Generally, the more active the intermediary is in facilitating the transaction between the parties, the more likely their activity is to be arranging.


Source: Australian Securities & Investments Commission Regulatory Guide 236 ‘Do I need an AFS licence to participate in carbon markets?’ May 2012 (http://asic.gov.au/asic/pdflib.nsf/LookupByFileName/rg236-published-9-March-2012.pdf/$file/rg236-published-9-March-2012.pdf)



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