media release (21-181MR)

ASIC consults on draft guidance for the hawking reforms


ASIC is consulting on proposed updates to its guidance on the prohibition on the hawking of financial products.

ASIC’s updated regulatory guide reflects the reforms to the anti-hawking regime under the Financial Sector Reform (Hayne Royal Commission Response) Act 2020, which is due to commence on 5 October 2021.

These reforms flow from two recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry. In its final report, the Financial Services Royal Commission stated reforming the hawking prohibition was necessary to protect consumers from being sold financial products they did not need or want.

Announcing the consultation, ASIC Commissioner Danielle Press said, 'These reforms strengthen and consolidate the three existing hawking prohibitions into a single prohibition covering all financial products. The reforms take a technology neutral approach, meaning the ban applies to all forms of real-time communication. The prohibition incorporates for the first time a definition of unsolicited contact, requiring that consent given by a consumer be positive, voluntary and clear'.

'These reforms will give consumers greater control over the circumstances in which they are offered products, and prevent consumers being approached with unwanted products on cold-calls or through other unsolicited contacts. They will also prevent businesses relying indefinitely on consents from consumers.'

'ASIC’s guidance gives additional clarity on how the changes may affect commercial practices, systems and processes. This will help industry prepare for compliance with the new regime once it commences.'

ASIC seeks public comment on the draft guidance. All interested stakeholders have until 17 August to provide feedback on CP 346.

ASIC will publish its final guidance in September 2021, ahead of the revised hawking prohibition commencing on 5 October 2021.



The reforms implement Recommendations 3.4 and 4.1 of the Financial Services Royal Commission, and are set out in Schedule 5 of the Financial Sector Reform (Hayne Royal Commission Response) Act 2020.

Key features of the reforms include:

  • application to all financial products (as defined in the Corporations Act 2001)
  • a definition of ‘unsolicited contact’ that extends the prohibition from in-person meetings and telephone calls, to any ‘real-time interaction in the nature of a conversation or discussion’ without consumer consent
  • that consumer consent must be positive, voluntary, clear and capable of being reasonably understood
  • that consent only be valid for six weeks from the date it is given and may be withdrawn by the consumer at any time, and
  • a statutory right of return for consumers who have been hawked a product. 

The reforms commence on 5 October 2021.  This aligns with the commencement of other major reforms that are aimed at delivering better consumer outcomes and put the needs of consumers at the heart of how products are designed and sold, namely the product design and distribution obligation and the deferred sales model for add-on insurance.

ASIC has previously highlighted the potential for harm and poor consumer outcomes when consumers are offered products in situations where they are not engaged or have not considered a purchase.

  • Report 587 The sale of direct life insurance (REP 587) found a link between outbound telephone sales,  poor sales conduct including pressure selling, and poor consumer outcomes. 
  • Report 622 Consumer credit insurance: Poor value products and harmful sales practices (REP 622) found the design and sale of consumer credit insurance had consistently failed consumers, especially in unsolicited telephone sales contexts. 

ASIC has previously taken action to tackle poor consumer outcomes in this space.  In 2019, ASIC made a legislative instrument banning unsolicited sales of direct life insurance and consumer credit insurance.

The Government has the power to make regulations exempting certain products or situations from the hawking provisions. We note Treasury consulted on exemptions as part of exposure draft legislation. Further exemptions from the hawking prohibition were foreshadowed in the Explanatory Memorandum and as part of the Treasurer’s media release in relation to the exemptions to the deferred sales model. Once any exemptions are made, ASIC will update its guidance.

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