{"id":"F2019L00204","name":"Australian Securities and Investments Commission (Investigation into Grandfathered Conflicted Remuneration for Financial Advice) Direction 2019","slug":"australian-securities-and-investments-commission-investigation-into-grandfathered-conflicted-remuner","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":439935,"registerId":"F2019L00204-fast-fetch-1775955765543","compilationNumber":null,"startDate":"2026-04-12","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Australian Securities and Investments Commission (Investigation into Grandfathered Conflicted Remuneration for Financial Advice) Direction 2019","content":"---\nmeta-content-style-type: text/css\nmeta-content-type: application/xhtml+xml; charset=utf-8\n---\n\n?xml version=\"1.0\" encoding=\"utf-8\" standalone=\"no\"?>\n\n![](image.001.jpeg)\n\n \n\nAustralian Securities and Investments Commission (Investigation into Grandfathered Conflicted Remuneration for Financial Advice) Direction 2019\n\nI, Josh Frydenberg, Treasurer, give the following direction to the Australian Securities and Investments Commission.\n\nDated  21 February 2019\n\n \n\nJosh Frydenberg\n\nTreasurer\n\n \n\n \n\n \n\n \n\nContents\n\nPart 1—Preliminary\n\n1  Name \n\n2  Commencement\n\n3  Authority\n\n4  Definitions\n\nPart 2—Direction to undertake investigation\n\n5  Direction to undertake investigation\n\n \n\nPart 1—Preliminary\n\n \n\n1  Name\n\n  This instrument is the Australian Securities and Investments Commission (Investigation into Grandfathered Conflicted Remuneration for Financial Advice) Direction 2019.\n\n2  Commencement\n\n (1) Each provision of this instrument specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.\n\n \n\n- Commencement information\n- Column 1 Column 2 Column 3\n- Provisions Commencement Date/Details\n- 1. The whole of this instrument 1 July 2019.\n\n\nNote: This table relates only to the provisions of this instrument as originally made. It will not be amended to deal with any later amendments of this instrument.\n\n (2) Any information in column 3 of the table is not part of this instrument. Information may be inserted in this column, or information in it may be edited, in any published version of this instrument.\n\n3  Authority\n\n  This instrument is made under the Australian Securities and Investments Commission Act 2001.\n\n4  Definitions\n\n  In this instrument:\n\nAct means the Australian Securities and Investments Commission Act 2001.\n\nGrandfathered conflicted remuneration means any benefit, the giving or acceptance of which would be prohibited by Subdivision C of Division 4 of Part 7.7A of the Corporations Act 2001 but for the operation of section 1528 of that Act.\n\nPart 2—Direction to undertake investigation\n\n \n\n5  Direction to undertake investigation \n\n  Under section 14 of the Act, the Australian Securities and Investments Commission is directed to investigate the extent to which persons who are giving or accepting grandfathered conflicted remuneration, as at the commencement of this instrument, are:\n\n (a) changing their arrangements to end the payment of grandfathered conflicted remuneration prior to 1 January 2021; and\n\n (b) passing the benefit of ending the payment of grandfathered conflicted remuneration on to clients, whether through direct rebates or otherwise.\n","sortOrder":0}],"analysis":{"kimi_summary":{"content_quality":"ok","complexity_score":2,"scope_assessment":{"changed":false,"description":"This instrument maintains its original narrow scope. It was always intended as a targeted, time-bound direction for a specific investigation into grandfathered conflicted remuneration arrangements ahead of the 2021 deadline. The scope has not expanded beyond this original purpose."},"complexity_factors":["Very short instrument — only 5 sections across 2 Parts","Only 2 defined terms in the interpretation section","Single, clear operative provision (section 5) with straightforward investigative mandate","No nested exceptions, conditional logic, or cross-referencing beyond basic statutory citations","Purpose-built for a specific, time-limited investigation rather than ongoing regulatory framework"],"plain_english_summary":"This Treasurer’s order directs ASIC to investigate how financial advisers handled “grandfathered conflicted remuneration” due to be banned from 1 January 2021 — specifically whether advisers actually ended those legacy commission arrangements on time and whether any savings were passed through to clients. It targets advisers still receiving such payments, requires ASIC reporting, and matters because it checks that post‑Royal Commission reforms delivered real consumer benefit rather than preserving industry profits."},"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"},"flash_summary":{"complexity_score":2,"scope_assessment":{"changed":false,"description":"No. The instrument does not change ASIC's statutory powers or the Corporations Act; it narrowly directs ASIC to investigate the extent to which persons giving or accepting grandfathered conflicted remuneration are ending payments before 1 January 2021 and passing savings to clients (see s5), using the definition in s4 and authorised under s3 (direction under section 14 of the ASIC Act)."},"complexity_factors":["Narrow, single-purpose mandate (s5) — the instrument directs ASIC to investigate two specific questions rather than create new rules or penalties.","Legal cross-reference (s4) — the key term 'grandfathered conflicted remuneration' depends on Subdivision C of Division 4 of Part 7.7A and section 1528 of the Corporations Act 2001, requiring lawyers/analysts to track external provisions.","Statutory authority reference (s3 & direction under s14 of the Act) — work relies on ASIC's existing investigatory powers rather than new powers, so procedural limits of section 14 apply.","Timebound factual inquiry — assessing whether payments end before 1 January 2021 creates a clear temporal cut-off but requires collecting contemporaneous commercial data across many entities.","Evidential and definitional ambiguity — determining if firms 'pass the benefit' (explicitly allowed 'through direct rebates or otherwise') may require judgment about non-cash or indirect customer benefits.","Low legislative drafting complexity — short instrument with few provisions reduces statutory complexity but shifts effort to practical data collection and interpretation."],"plain_english_summary":"This Direction orders the Australian Securities and Investments Commission (ASIC) to investigate how many people were giving or receiving “grandfathered conflicted remuneration” when the instrument commenced, whether they are stopping those payments before 1 January 2021, and whether any savings are being passed to clients (including by rebates). It targets financial product providers, advisers and their clients, and is a Treasurer-issued investigatory instruction under the ASIC Act rather than a change to the Corporations Act."}},"importantCases":[],"_links":{"self":"/api/acts/australian-securities-and-investments-commission-investigation-into-grandfathered-conflicted-remuner","history":"/api/acts/australian-securities-and-investments-commission-investigation-into-grandfathered-conflicted-remuner/history","analysis":"/api/acts/australian-securities-and-investments-commission-investigation-into-grandfathered-conflicted-remuner/analysis","conflicts":"/api/acts/australian-securities-and-investments-commission-investigation-into-grandfathered-conflicted-remuner/conflicts","importantCases":"/api/acts/australian-securities-and-investments-commission-investigation-into-grandfathered-conflicted-remuner/important-cases","documents":"/api/acts/australian-securities-and-investments-commission-investigation-into-grandfathered-conflicted-remuner/documents"}}