White Paper on the Future of Advice Licensing

The Financial Services Council’s (FSC) White Paper on the Future of Advice Licensing concludes that Australia’s financial advice licensing framework remains structurally fit for purpose, while identifying opportunities to enhance regulatory supervision as the advice market evolves. More proactive supervision would help ensure existing obligations are consistently met and support enduring consumer confidence in the sector.

The White Paper follows a year-long consultation involving advice licensees, financial advisers, consumer representatives, professional associations, academics and other stakeholders across the advice ecosystem. Beginning with the FSC’s July 2025 Green Paper on Advice Licensing, the process deliberately tested a broad range of structural reform options, including tiered licensing and practising certificates.

While views differed on individual reforms, the consultation produced a clear conclusion: Australia does not need to replace the existing Australian Financial Services Licence framework. New laws are not required; instead, ASIC needs to supervise the existing framework more effectively and identify emerging risks before they result in consumer harm.

The White Paper makes 19 recommendations, including:

• Introducing a universal minimum standard of ASIC supervision, including biannual supervisory engagement with every advice licensee (involving a more comprehensive annual licence renewal as one of the two engagements);
• Establishing a dedicated risk-based supervision program for higher-risk licensees, supported by enhanced regulatory intelligence;
• Redesigning the ASIC financial advice levy to fund the recommended supervisory uplift, increasing it from $1,500 (2024-25) to a minimum of $25,000 while proportionately reducing the per-adviser fee from ~$2,300 to a maximum of $1,700. This would better align levy incidence with where risk is managed, recognising that continued increases in per-adviser fees are not sustainable as a means of addressing ongoing regulatory costs. The total financial advice levy raised from active personal advice AFSLs (with caveats identified in the White Paper) would therefore increase from approximately $37.4 million to $65.1 million, funding the indicative cost of the White Paper’s supervision-led reform model of $27.8 million;
• Modernising the Financial Advisers Register, including a licensee view showing all advisers and corporate authorised representatives under a licensee, clearer adviser authorisations and greater transparency of responsible managers; and
• Enhancing oversight of professional indemnity insurance, including annual review of licensees' PI arrangements, a review of minimum cover requirements and improved monitoring of material changes to cover.