Special purpose vehicles proposed licensing relief

PROPOSALS to grant limited ongoing class order licensing relief for certain securitisation entities have been released.

The proposed relief will exempt certain special purpose vehicle issuers of debentures or interests in a managed investment scheme from the requirement to obtain an Australian Financial Services licence.

It will apply to those SPVs that carry on business only in relation to a particular securitisation transaction.

The Australian Securities and Investments Commission is seeking comment on these proposals as they apply to issuers of securitisation products and managers of securitisation transactions.

"The proposed relief acknowledges that an unreasonable burden may be imposed by requiring SPVs to hold an AFS licences where the SPV is created for the sole purpose of effecting a single securitisation transaction and in circumstances where the securitisation process is largely a predetermined one," ASIC director of regulatory policy Mark Adams said.

"The proposed conditions of relief are intended to ensure relief will not affect services provided to retail clients and that an AFS licensee accepts responsibility for financial services provided by the SPV," he said.

To ensure there is adequate time for compliance with the AFS licensing requirement or conditions of relief that may form ASIC’s policy following the consultation process, ASIC has extended its interim relief from September 30 until March 31 2005.

A copy of the consultation paper and the relevant class order can be obtained from www.asic.gov.au or by phoning 1300 300 630.

Submissions need to be submitted by September 17.