ASIC Pro Forma 209: What It Means for Your AFSL Conditions 

Introduction

ASIC Pro Forma 209 (PF 209), issued in May 2026, sets out the standard licence conditions usually applied to Australian Financial Services (AFS) Licences, subject to each licensee’s circumstances. However, PF 209 is not legislation, and the conditions imposed on an individual licence determine which requirements are enforceable.

Section 914A(1) of the Corporations Act 2001 (Cth) (‘Corporations Act’) gives ASIC (Australian Securities and Investments Commission) power to impose, vary or revoke licence conditions by written notice. AFS licence applicants and licensees need to distinguish between PF 209 conditions, prescribed conditions under Regulation 7.6.04 of the Corporations Regulations 2001 (Cth) (‘Corporations Regulations’), and individually tailored conditions. This article explains how each type of condition applies, how standard conditions are structured, how licences can be varied and what licence holders should check when reviewing their conditions.

Interactive Tool: Check Which AFSL Licence Conditions Apply to Your Business

What Is ASIC Pro Forma 209?

The Purpose & Legal Status of PF 209

PF 209, issued in May 2026, sets out the standard licence conditions frequently applied to AFS licences authorising a person to provide financial services. The conditions remain subject to the applicant’s or licensee’s individual circumstances.

As mentioned before, PF 209 is not legislation, and its conditions do not automatically apply to every AFS licence. The enforceable requirements depend on:

• the conditions ASIC actually imposes on the individual licence document, which the licensee must comply with under Section 912A(1)(b) of the Corporations Act;
• prescribed conditions under the Corporations Regulations; and
• other applicable statutory obligations.

For the same reason, an updated PF 209 does not automatically amend existing licences. Licensees should check their individual licence document to identify the conditions that actually apply to them.

Standard, Prescribed & Individually Tailored AFSL Conditions

Standard conditions are drawn from PF 209 and imposed on an individual AFS licence by ASIC. ASIC applies different combinations of these conditions based on each licensee’s authorisations, activities and individual circumstances, including the financial services, financial products and client types covered by the licence.

Prescribed conditions under Regulation 7.6.04 of the Corporations Regulations apply in addition to any PF 209 conditions ASIC imposes on the licence. This is because Section 914A(8) of the Corporations Act makes every AFSL subject to the conditions prescribed by the regulations. As a result, these conditions operate automatically by law and do not depend on whether they are printed on the AFSL document.

The conditions under Regulation 7.6.04 of the Corporations Regulations include requirements concerning:

• material adverse changes to the licensee’s financial position;
• changes to register details;
• representative training records; and
• changes in control.

Under Section 914A(1) of the Corporations Act, ASIC may also impose individually tailored conditions on an AFS licence at any time by written notice. The provision does not list criteria ASIC must apply, but in practice these conditions respond to the licensee’s regulatory circumstances and address matters not covered by the standard PF 209 conditions or the prescribed conditions under Regulation 7.6.04 of the Corporations Regulations.

As tailored conditions differ from licence to licence, financial services lawyers for tailored AFSL regulatory advice can help assess how they apply to a particular business.

What Types of AFSL Conditions Does PF 209 Cover?

Financial Services Authorisations & Restrictions

Condition 1 of the PF 209 states the financial services business a licensee is authorised to conduct. It may cover services such as:

• providing financial product advice;
• dealing in financial products;
• making a market;
• operating a registered managed investment scheme; or
• providing custodial or depository services.

The condition also identifies the relevant financial product classes and whether services may be provided to retail clients, wholesale clients, or both. ASIC may include limits on the licensee’s capacity, method of dealing, products, or client type.

Under Section 914A(6) and Section 914A(7) of the Corporations Act, these authorisations identify the services and product classes the licence permits. Other conditions may restrict or regulate how those services are conducted.

General Compliance & Governance Conditions

Condition 3 of PF 209 requires a licensee to notify ASIC in writing within 5 business days if a nominated key person or officer stops performing duties for the financial services business. The notice must address the person’s departure, any replacement, and how the licensee will continue complying with the Corporations Act and its licence conditions.

Where imposed, Condition 4 of PF 209 requires the licensee to establish and maintain compliance measures that ensure, as far as reasonably practicable, compliance with financial services laws. This sits alongside the licensee’s statutory duty under Section 912A(1)(c) of the Corporations Act to comply with the financial services laws. 

In addition, Condition 6 of PF 209 applies to licensees authorised to provide financial product advice to retail clients. It requires the licensee to identify the tasks and functions of each person who gives that advice on its behalf, determine the knowledge and skills those functions require, and maintain procedures for continuing training.

Conditions 7–9 then set the training or competency standards those advisers must meet, with exceptions for scripted or supervised customer service staff and certain other advice.

Separately, financial advisers who are ‘relevant providers’ (broadly, individuals authorised to give personal advice to retail clients on relevant financial products) must meet the education and training standards in Section 921B of the Corporations Act. These standards apply by law, not through a licence condition.

Financial Requirements & Audit Conditions

These conditions operate alongside Section 912A(1)(d) of the Corporations Act, which requires a licensee that is not an APRA-regulated body to have adequate resources, including financial resources, to provide its financial services. ASIC sets out its standard financial conditions in Pro Forma 209 (PF 209), and ASIC’s Regulatory Guide 166 (RG 166) explains how they apply.

The base level financial requirements are set out in condition 13 of PF 209. A licensee must:

• be able to pay its debts as and when they become due, under condition 13(a);
• have total assets exceeding total liabilities, or adjusted assets exceeding adjusted liabilities, under condition 13(b); and
• meet the cash needs requirement through one of five options, under condition 13(c).

RG 166.30 describes these as the solvency and positive net assets requirement, the cash needs requirement and the audit requirement. Some licensees, such as responsible entities and custodial or depository service providers, instead meet tailored cash needs requirements under ASIC legislative instruments. Under condition 12, conditions 13 to 26 do not apply to market participants or clearing participants.

Additional financial conditions apply to particular activities:

• issuing margin lending facilities, which triggers a net tangible assets (NTA) requirement;
• providing traditional trustee company services, which requires at least $5 million in NTA;
• entering into foreign exchange contracts as principal, which requires either $10 million of tier one capital or adjusted surplus liquid funds (ASLF);
• holding client money or property, where condition 21 of PF 209 requires a licensee that is not an APRA-regulated body to hold at least $50,000 in surplus liquid funds once the client money or property it holds reaches $100,000 or more; and
• transacting with clients as principal, which requires ASLF, with reporting triggers and board certifications.

The audit conditions operate together with Section 989B of the Corporations Act, which requires a licensee to lodge annual financial statements with ASIC, together with an auditor’s report.

Under condition 28 of PF 209, a licensee that is not an APRA-regulated body must also lodge an opinion by a registered company auditor on its compliance with the financial requirements in conditions 13 to 26, at the same time as its annual balance sheet, unless it is a limited licensee that does not deal with client money.

An APRA-regulated licensee instead lodges an audit opinion confirming that it remained an APRA-regulated body, under condition 27. RG 166.62–RG 166.64 explains the audit reporting framework.

Client Protection & Business-Specific Conditions

Conditions 29–30 of PF 209 address professional indemnity insurance. Where the applicable condition is imposed, the insurance must be adequate having regard to the nature of the activities carried out under the licence. 

Separately, Section 912B of the Corporations Act and Regulation 7.6.02AAA of the Corporations Regulations generally require licensees that provide financial services to retail clients to have compensation arrangements, usually adequate professional indemnity insurance, whether or not a PI condition appears on the licence. ASIC’s guidance on these arrangements is in Regulatory Guide 126.

Conditions 32–33 of PF 209 apply to licensees that provide financial services to retail clients. AFCA membership is also a direct legal requirement for licensees with retail clients under Section 912A(1)(g) and Section 912A(2)(c) of the Corporations Act, so it applies even if condition 32 of PF 209 is not printed on the licence. 

Business-specific conditions address activities such as time-sharing schemes and horse racing schemes. They may require:

• records of cooling-off statements issued for time-sharing schemes;
• separate accounting records for each horse racing scheme;
• financial statements for horse racing schemes; and
• separate trust accounts and approved promoter registration.

Can Standard AFSL Conditions Be Varied or Removed by Licensees?

ASIC’s Powers to Vary or Revoke Conditions

Under Section 914A(1) of the Corporations Act, ASIC may, at any time and by written notice, impose additional conditions on an AFS licence or vary or revoke conditions already imposed. 

For an ASIC-initiated imposition or variation, Section 914A(3) of the Corporations Act requires ASIC to give the licensee an opportunity to appear, or be represented, at a private hearing and make submissions. 

However, this hearing requirement does not apply when conditions are imposed when a licence is granted or when ASIC acts on a licensee’s variation application.

How to Check Which AFSL Conditions Apply to Your Business

The conditions that bind a licensee come from several sources, so they cannot be confirmed from PF 209 alone. Working through the following steps in order helps a licensee confirm which conditions apply and whether its licence still suits its business.

Step 1: Review Your Individual AFS Licence Document

AFSL holders should begin with the individual AFS licence document issued by ASIC, rather than the PF 209 template, and make sure it is the current version reflecting any conditions ASIC has since imposed or varied by written notice.

The document sets out the financial services and product authorisations under Section 914A(6) of the Corporations Act. It may also include restrictions on the capacity, method or products covered by an authorisation.

Step 2: Identify the PF 209 Conditions Imposed on Your Licence

The licence document also identifies the PF 209 conditions imposed on the licensee. These are the standard conditions enforceable under that licence, so each condition number should be noted and matched against the categories explained above, such as compliance measures, training, financial requirements, audit and professional indemnity insurance.

A PF 209 condition that does not appear on the licence does not apply as a licence condition, although some related obligations, such as AFCA membership for licensees with retail clients, apply by law.

Step 3: Check the Prescribed Conditions Under Regulation 7.6.04 Separately

Prescribed conditions under Regulation 7.6.04 of the Corporations Regulations apply to every AFSL by law, whether or not they are printed on the licence document. They should be checked separately, including the requirements concerning material adverse changes to the licensee’s financial position, changes to register details, representative training records and changes in control.

Step 4: Compare Your Conditions With Your Current Business Activities

A licensee should compare its actual financial services business with the authorisations, restrictions and conditions identified in the previous steps. This includes checking for any services, products or client types the business now provides that the licence does not cover, and any condition the business is not currently meeting.

Step 5: Decide Whether a Licence Variation Is Needed

A business that has expanded its services, products or client types may need a variation application. The Vary authorisations and conditions of an Australian financial services licence application is lodged online through the ASIC Regulatory Portal. 

ASIC Regulatory Guide 1, RG 1.9, explains that ASIC considers whether a licensee has the capacity and competence to provide additional financial services or products and whether changes to other conditions are appropriate. The information supplied should therefore be complete and accurate, as deficiencies may result in the application being returned, refused or delayed.

Where it is unclear which conditions apply or whether a variation is needed, Click Legal’s AFSL compliance services for reviewing licence conditions can help licensees confirm their position and prepare a complete application.

Conclusion

PF 209 provides a standard set of AFSL conditions, but the requirements applying to a licensee depend on the conditions imposed on its individual licence, prescribed conditions under Regulation 7.6.04 of the Corporations Regulations, and the general obligations in Section 912A(1) of the Corporations Act, including the obligation in Section 912A(1)(b) to comply with the licence conditions. Licence holders should compare their authorisations and conditions with their actual business activities and seek a variation when those activities change.

With these distinctions in mind, contact Click Legal to review an AFSL’s conditions, assess whether its authorisations remain suitable, or prepare a variation application. Click Legal provides clear, commercial advice to financial services businesses, and licensees can contact Click Legal’s lawyers about AFSL compliance services for financial services businesses to manage their obligations as their operations develop.

Frequently Asked Questions