ASIC Increases Net Tangible Assets Requirements for Responsible Entities
The Australian Securities and Investments Commission (ASIC) has introduced new regulations to increase the minimum Net Tangible Assets (NTA) requirements, effective 1 July 2027.
The changes aim to reflect inflation since the thresholds were last updated in 2013 and introduce annual inflation-based adjustments.
The new requirements will affect responsible entities of registered managed investment schemes, investor directed portfolio services (IDPS) operators, and corporate directors of retail corporate collective investment vehicles (CCIVs).
ASIC has also updated Regulatory Guide 166 (RG 166) and will publish revised NTA thresholds annually.
Key Takeaway: Affected financial institutions should review their financial positions and prepare for the upcoming regulatory changes to maintain compliance.
Follow us on LinkedIn for the latest industry updates and trending news.
1.Changes to the NTA Requirement
The minimum financial thresholds under the NTA requirement will increase to reflect inflation since they were last updated in 2013. The thresholds will also be adjusted annually to keep pace with inflation.
From 2027, ASIC will publish the updated thresholds on its website each year after the relevant inflation data becomes available.
2. Entities Affected
The changes apply to responsible entities of registered managed investment schemes, operators of investor directed portfolio services (IDPS), and corporate directors of retail corporate collective investment vehicles (CCIVs).
Responsible entities of registered managed investment schemes are already subject to financial requirements, including the NTA requirement, under ASIC Instrument 2023/647. Similar requirements apply to IDPS operators and corporate directors of retail CCIVs.
3. Regulatory Guidance
ASIC has updated Regulatory Guide 166, AFS licensing: Financial requirements (RG 166), to reflect the forthcoming changes.
This is a practical recommendation, not a separate ATO requirement.
Conclusion
ASIC’s new instrument will increase the minimum NTA thresholds from 1 July 2027 and introduce annual inflation adjustments. The changes affect responsible entities, IDPS operators and corporate directors of retail CCIVs, with updated thresholds to be published by ASIC each year.
Disclaimer
This article reflects publicly available information regarding the exposure of draft legislation as at the date of publication and is general in nature. It does not constitute tax, financial, or legal advice and should not be relied upon without obtaining professional advice tailored to your specific circumstances. To discuss how these proposed changes may affect you or your business, please contact our advisory team at Wis Australia.
Liability Limited By A Scheme Approved Under Professional Standards Legislation.
