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Hawking reforms guidance released for feedback

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The Australian Securities and Investments Commission (ASIC) is seeking feedback on regulatory guidance that will apply to anti-hawking laws due to take effect from October.

The laws extend strengthened prohibitions to all financial products and take account of technological changes that could expand opportunities for a practice historically associated with high-pressure telephone and door-to-door sales.

ASIC Commissioner Danielle Press says the reforms take a “technology neutral approach” that applies to all forms of real-time communication and incorporate for the first time a definition of unsolicited contact, requiring that consent is 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,” she said today. “They will also prevent businesses relying indefinitely on consents from consumers.”

The revised regulatory guide outlines the interaction between the hawking reforms and add-on deferred sales reforms and provides examples of how the laws will apply in the context of using a comparison website and in other sales situations.

ASIC is seeking input on questions including which products are commonly bundled together or cross-sold and whether the laws will raise practical issues in those instances.

It also asks for feedback on whether organisations agree with proposed guidance on offering products “that are within reasonable scope of a consumer’s consent” and whether giving refunds raises any practical issues in cases where hawking laws have been breached.

Ms Press says the guidance will give additional clarity on how the changes may affect commercial practices, systems and processes and help industry prepare for compliance with the regime once it starts on October 5.

Responses on the regulatory guidance are due by August 17, with ASIC to publish its updated version in September.

Consultation details are available here.