The Australian Securities & Investments Commission (ASIC) has published Consultation Paper 384 on how employee redundancy funds should be regulated under the Corporations Act 2001 once ASIC’s transitional relief expires on 1 April 2026. The paper reopens the question of what ongoing exemptions or conditions, if any, are appropriate for fund operators. ASIC points to significant growth in funds under management, the expansion of some operators’ activities beyond redundancy entitlements, and mixed feedback from its 2024 consultation as reasons to reassess the current approach. The consultation seeks views on changes to the definition of “employee redundancy funds” for the purposes of ASIC guidance and any relief granted, and sets out three regulatory options: letting relief lapse and requiring full compliance with the Corporations Act, providing targeted relief from specific obligations, or remaking the existing relief with additional conditions; it also notes sector growth from around AUD 500 million under management in 2003 to AUD 2 billion in 2015, with some individual funds now close to or exceeding AUD 1 billion and some also raising money for long service leave entitlements. Submissions are due by 5.00 pm on 22 July 2025, and ASIC expects to announce its final position on its approach by late 2025.
Australian Securities & Investments Commission 2025-06-24
Australian Securities & Investments Commission launches consultation on options for regulating employee redundancy funds as relief ends on 1 April 2026
ASIC has released Consultation Paper 384 to regulate employee redundancy funds under the Corporations Act 2001, as ASIC’s transitional relief expires on 1 April 2026. The paper proposes three options: full compliance, targeted relief, or remaking existing relief with conditions. It also considers redefining “employee redundancy funds” and notes sector growth from AUD 500 million in 2003 to AUD 2 billion in 2015.