RG274 Design and distribution obligations

What are ASIC’s design and distribution obligations

The design and distribution obligations are intended to help consumers obtain appropriate financial products by requiring issuers and distributors to have a consumer-centric approach to the design and distribution of products.

New rules, among other outcomes, dramatically alter traditional information flows between product issuers, advisers and end consumers, and expose issuers to unprecedented levels of scrutiny and potentially even liability.

In Regulatory Guide 274 Product design and distribution obligations (RG 274), ASIC sets out the steps product issuers must follow in order to satisfy the target market determination (TMD) requirements.

So, what entities and products are most affected, and how?

Target Market Determination

Under the design and distribution obligations, a product issuer must identify an appropriate target market for their product. This includes assessing whether the product, including its ‘key attributes’, is consistent with the needs, objectives and financial situation of a particular class of customer. If an appropriate target market cannot be identified for a product, an issuer will not be able to offer the product.

About our course

Our online course Design and Distribution briefly traces the journey from conception to DDO & PIP implementation, we explore what areas are being targeted first and what the new measures might mean for your organisation.

Program Content

Learning Outcomes

What you will learn

  • The global and domestic themes that drove the creation of DDO
  • Key milestones in the development of DDO and PIP in Australia
  • What the principles of DDO are
  • How ASIC intends to exercise its product intervention powers in general terms and in the product segments where it has already taken action
  • How financial services will be impacted by design and distribution obligations and product intervention powers

Who is this course for?

Units of Competency

Pre-requisite

Recognition of Prior Learning

Certification

You will be awarded a Certificate of Completion. It will be available online for you to download and print immediately.

RG146 CPD Area: Regulation

 

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Frequently Asked Questions

ASIC's RG 274 design and distribution obligations is for issuers and distributors of financial products that must comply with the design and distribution obligations in Pt 7.8A of the Corporations Act. It explains ASIC's interpretation of the design and distribution obligations, expectations for compliance, and its general approach to administering the obligations. RG274 design and distribution obligations are intended to help consumers obtain appropriate financial products by requiring issuers and distributors to have a consumer-centric approach to the design and distribution of products.  

The target market, distribution conditions, and information related to review and monitoring must be set out in a document called a ‘target market determination’ (TMD). The TMD is a written document prepared and made available before engaging in ‘retail product distribution conduct’. (RG 274.10) Under the design and distribution obligations, a product issuer must identify an appropriate target market for their product. This includes assessing whether the product, including its ‘key attributes’, is consistent with the needs, objectives and financial situation of a particular class of customer. If an appropriate target market cannot be identified for a product, an issuer will not be able to offer the product.

Our CPD short courses are self-paced with online learning resources & on-going support.
  • You have up to 8 weeks to complete the learning and assessment requirements for your CPD short course.
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Our CPD short courses are assessed by a short open book multiple-choice exam.

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What is RG206?2023-04-21T07:53:53+10:00

Regulatory Guide 206 Credit licensing: Competence and training (RG 206)

Credit licensees must comply with the organisational competence obligation in s47(1)(f) of the National Consumer Credit protection Act 2009 (National Credit Act). Regulatory Guide 206 Credit licensing: Competence and training (RG 206) sets out the minimum expectations for demonstrating organisational competence.

What you need to do to comply will depend on the nature, scale and complexity of your business. However, Regulatory Guide 206 Credit licensing: Competence and training (RG 206) sets out our minimum expectations for demonstrating organisational competence.

You must also ensure that your representatives are adequately trained and competent to engage in the credit activities authorised by your licence: s47(1)(g).

ASIC generally expects you to determine what is appropriate initial and ongoing training for your representatives and to embed this in your recruitment and training systems.

Updated annually, our CPD is designed to enable Responsible Managers and Representatives of Australian Credit Licensees to meet their mandatory RG206 continuing training requirement. Our CPD that is structured, properly assessed and recorded.

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