Administration & Management
Complaints handling: A board responsibility
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Following consultation, the Australian Securities and Investment Commission (ASIC) has released updated internal dispute resolution guidance for financial firms (Regulatory guide 271 Internal Dispute Resolution (RG 271)) and registered a legislative instrument (ASIC Corporations, Credit and Superannuation (Internal Dispute Resolution) Instrument 2020/98), clarifying new enforceable standards and requirements for internal dispute resolution (IDR) procedures.

Among other things, the guidance:

  • adopts a new broader definition of complaints and amends the definition of small business
  • stipulates shorter maximum timeframes for responding to IDR complaints
  • outlines requirements for the content of the complaint responses
  • provides guidance on the identification and management of systemic issues (including the role of boards and 'front line' staff in this process).
Certain standards and requirements in the guidance (eg. the maximum tine frames for providing an IDR response) are enforceable through obligations under section 912A of the Corporations Act 2001 and section 47 of the National Consumer Credit Protection Act 2009. ASIC has highlighted these in the guidance.

RG271 will apply to complaints received by financial firms on or after 5 October 2021.  Until that date, Regulatory Guide 165 Licensing: Internal and external dispute resolution (RG 165) continues to apply.

The revised guidance and accompanying legislative instrument are intended to 'drive fair and timely complaint outcomes for consumers and sharpen industry's focus on systemic issues'.

ASIC has also released a report, ASIC Report 665 Response to submissions on CP 311 Internal dispute resolution: update to RG 165, outlining the key issues raised during the consultation on proposed changes to existing guidance and its response to these issues.

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