The Australian Securities and Investments Commission (ASIC) announced a six-month postponement of the design and distribution obligations (DDO) for financial products until 5 Oct 2021 — from 5 Apr 2021 — due to the economic impact of COVID-19, particularly on the financial system and consumers. 

The DDO establishes a new governance regime and follows the Financial System Inquiry’s recommendations:

• Financial product issuers must identify target markets for their products and consumers, select appropriate distribution channels, and periodically review arrangements to ensure they remain appropriate.
• Distributors of financial products must establish reasonable controls to ensure products are distributed in accordance with the identified target markets. 

Consultation on draft guidance for the DDO closed in March 2020, and ASIC recently confirmed its aim to publish final guidance in mid-2020. The DDO requirements featured in the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Act 2019 received royal assent on 5 Apr 2019.

Related resources

• Press release (ASIC, 8 May 2020)
• ASIC instrument 2020/486 (ASIC, 8 May 2020)
• Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Act 2019 (Australian Government)
• Draft guidance on product design and distribution obligations (ASIC, December 2019)