Guides · Financial Services Guide · Chapter 2 of 7
Authorisation pathways: your own licence or someone else's
Last reviewed 29 August 2026
Comparing a full AFSL application with authorised representative and corporate authorised representative arrangements, including what each costs you in control.
In short
There are three realistic routes to market: apply for your own AFSL, be appointed as an authorised representative of an existing licensee, or distribute under a referral or intermediary arrangement. Your own licence gives control and independence at the cost of time and organisational overhead. An authorisation is faster but the licensee controls your scope, your conduct and your ability to keep operating.
Almost every regulated business faces the same early decision: apply for a licence, or borrow one. The right answer usually turns on how central the regulated activity is to the business, and how long you can afford to wait.
Your own AFSL
An application to ASIC must establish that the applicant is competent to provide the services sought, has adequate financial and human resources, and can comply on an ongoing basis. In practice this means preparing a set of proofs:
- Organisational competence. Nominated responsible managers whose knowledge and skills meet one of ASIC's recognised options, evidenced by qualifications and verified employment history.
- Financial resources. Meeting the base, cash needs and (where applicable) surplus liquid funds or net tangible asset requirements attaching to your authorisations. Custodial, market-making and scheme operation carry materially higher requirements.
- Compliance, risk and conflicts. Documented arrangements proportionate to the business, not a generic template.
- Dispute resolution. An internal process meeting ASIC's requirements and membership of the Australian Financial Complaints Authority.
- Insurance. Professional indemnity cover adequate for the retail business conducted.
Well-prepared applications commonly take several months from lodgement. Applications that are incomplete, or that describe an unusual business model without explaining it, take considerably longer because ASIC's questions arrive in sequence rather than all at once.
Authorised representative arrangements
A licensee can appoint an individual or a body corporate to provide specified services on its behalf. The appointment is recorded on ASIC's register, and the licensee is responsible to clients for the representative's conduct within the scope of the authorisation. That responsibility explains everything about how these arrangements are run.
What to test before signing:
- Scope. Precisely which services and which product classes. Anything outside it is unlicensed conduct.
- Supervision and monitoring. File reviews, approval of client-facing material, training obligations, audit rights.
- Termination. Notice periods, immediate termination triggers, and what happens to your client book and revenue if the authorisation ends. Termination on short notice can end the business overnight.
- Fees and liability. Licensee fees, indemnities running back from you to the licensee, and how PI cover responds.
- Transition. Whether the arrangement supports a later move to your own licence, or entrenches dependence.
Corporate authorised representatives and sub-authorisation
A corporate authorised representative may, where the licensee permits, appoint its own representatives — creating a distribution layer. This is workable, but the compliance obligations flow down and the licensee's tolerance for it varies. Do not assume you can sub-authorise unless the appointment says so.
Choosing between them
An authorisation suits a business testing a model, where the regulated activity is adjacent to the core product, or where speed to market decides the outcome. Your own licence suits a business where regulated activity is the product, where distribution partners will diligence your licensing position, or where investors will price licensee dependency as a risk.
Where this fits
We scope and prepare AFSL applications, and review authorised representative agreements before signature, on a fixed fee agreed in advance.
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All chapters
- 01Do you need an AFSL?
- 02Authorisation pathways: your own licence or someone else's
- 03ASIC obligations once you are licensed
- 04Disclosure: FSGs, SOAs, PDSs and target market determinations
- 05Marketing and promotion of financial products
- 06Building a compliance framework that holds up
- 07Breach reporting, remediation and enforcement