ASIC Regulatory Guide 274 — Product Design and Distribution Obligations
|
|
| Regulator |
ASIC |
| Jurisdiction |
AU |
| Status |
live |
| Applicability |
Platform |
ASIC Regulatory Guide 274 gives guidance on the Design and Distribution Obligations (DDO) contained
in Part 7.8A of the Corporations Act 2001 (ss.994A–994L). DDO applies to issuers and distributors of
financial products to retail clients, including all deposit products, credit products, and payment
facilities. The regime came into force on 5 October 2021.
The central mechanism of DDO is the Target Market Determination (TMD): every in-scope product must
have a TMD that describes the target market, the distribution conditions, and the review triggers.
Issuers must take reasonable steps to ensure products are distributed within the target market. ASIC
has enforcement powers including stop orders, licence action, and civil penalties up to AU$1.565M
per contravention for individuals and AU$15.65M (or 3x benefit or 10% annual turnover) for body
corporates. AU jurisdiction only.
Compliance register
This register maps every material obligation under RG 274 / Part 7.8A to the platform control or
institutional process that satisfies it. It is the static traceability layer for the Totara
compliance report — dynamic data (module build status, test evidence, control test dates) is
overlaid at runtime.
Scope legend
| Symbol |
Meaning |
| 🤖 Automated |
Platform enforces or performs the obligation. Primary control mode is GATE, AUTO, CALC, or ALERT. Human action is not required in the normal case. |
| 📊 Evidenced |
Platform captures the evidence trail automatically. Human compliance decision sits on top. Primary control mode is LOG. |
| 🏛 Institutional |
Obligation is met by a process entirely outside the platform — training programmes, board governance, HR, legal. Platform may generate evidence inputs but does not own the process. |
| N/A |
Obligation does not apply to this deployment configuration. |
Build legend
| Symbol |
Meaning |
| ✅ |
Module built and deployed |
| 🔨 |
Module planned — not yet built (build_status: Not started) |
| ❌ |
Uncontrolled gap — no module attributed |
Target Market Determinations (s.994B)
| Ref |
Obligation |
Scope |
Policy |
Platform controls |
Build |
| S.994B |
Make a TMD for each in-scope retail product before distribution commences; TMD must describe the target market, distribution conditions, and review triggers |
🤖 Automated |
CRE-008 |
MOD-155 (GATE) — no AU retail product can be distributed without an approved, current TMD on file; distribution is blocked at the product configuration layer; no bypass path |
🔨 |
| S.994B(3) |
TMD must include: class of retail clients in the target market; description of product consistent with target market; distribution conditions; review triggers; review period |
🏛 Institutional |
CRE-008 |
TMD content is authored by the Head of Product and approved by the Chief Risk Officer — platform stores and enforces the TMD; content is institutional. MOD-155 validates TMD structure on upload. |
— |
| S.994B(8) |
Review and update the TMD within the prescribed review period or sooner if a review trigger fires |
🤖 Automated |
CRE-008 |
MOD-155 (AUTO) — review trigger events are detected automatically (e.g. significant dealing report threshold crossed, complaints spike, product change); review flag raised without manual monitoring; TMD expiry blocks distribution if review not completed |
🔨 |
Distribution conditions and monitoring (s.994E)
| Ref |
Obligation |
Scope |
Policy |
Platform controls |
Build |
| S.994E |
Distributors must take reasonable steps to ensure product is distributed consistently with the TMD |
🤖 Automated |
CRE-008, CON-006 |
MOD-155 (AUTO) — customer characteristics are automatically evaluated against TMD target market criteria at each product sale; out-of-target-market distribution events are detected and recorded without manual review; MOD-105 (GATE) — product eligibility matrix enforces consistent target market scoping across all offer channels |
🔨 |
| RG 274.73 |
Monitor distribution channel compliance; collect data to assess whether products are reaching the target market |
🤖 Automated |
CRE-008 |
MOD-155 (AUTO) — distribution event data is captured continuously; out-of-target-market events are flagged and logged; distribution monitoring does not require manual sampling |
🔨 |
Significant dealings reporting (s.994F)
| Ref |
Obligation |
Scope |
Policy |
Platform controls |
Build |
| S.994F |
Distributors must report significant dealings (distributions materially inconsistent with TMD) to the product issuer within 10 business days of becoming aware |
🤖 Automated |
CRE-008 |
MOD-155 (AUTO) — significant dealing threshold detection is automated; report is generated and flagged for submission to issuer within the required timeframe; no manual monitoring required |
🔨 |
| S.994F(6) |
Issuers must notify ASIC within 10 business days of becoming aware of a significant dealing |
🤖 Automated |
CRE-008 |
MOD-155 (AUTO) — ASIC significant dealing notification is auto-generated from the same trigger as the internal distribution monitoring flag; submission to ASIC is tracked |
🔨 |
Record-keeping and review
| Ref |
Obligation |
Scope |
Policy |
Platform controls |
Build |
| RG 274.141 |
Maintain TMD register and distribution records; retain for 7 years |
📊 Evidenced |
CRE-008 |
MOD-155 (LOG) — TMD versions, distribution events, trigger detections, and review outcomes are all retained; records are immutable; MOD-047 (LOG) — product distribution decisions are auditable |
🔨 |
| S.994B(5) |
TMD must be made available publicly (on issuer's website) |
🏛 Institutional |
CRE-008 |
Public TMD publication is a website management obligation. MOD-155 stores the authoritative TMD; publication to the bank's public website is a separate institutional step. |
— |
The following obligations under RG 274 / Part 7.8A are the responsibility of the institution, not the platform.
| Obligation |
Owner |
Platform evidence input |
| TMD content authorship and approval (target market description, distribution conditions) |
Head of Product / Chief Risk Officer |
MOD-155 stores and version-controls TMD content after approval |
| Distributor agreements — ensuring third-party distributors have DDO obligations in their contracts |
General Counsel |
— |
| ASIC reportable situation notifications beyond DDO significant dealings |
Chief Compliance Officer |
MOD-155 flags distribution events for compliance review |
| Product governance board review of out-of-target-market distribution patterns |
Chief Risk Officer |
MOD-155 provides distribution event data for board review |
Coverage summary
| Area |
Total obligations |
Platform automated 🤖 |
Platform evidenced 📊 |
Institutional 🏛 |
N/A |
| TMD requirements |
3 |
2 |
0 |
1 |
0 |
| Distribution monitoring |
2 |
2 |
0 |
0 |
0 |
| Significant dealings |
2 |
2 |
0 |
0 |
0 |
| Record-keeping |
2 |
0 |
1 |
1 |
0 |
| Total |
9 |
6 (67%) |
1 (11%) |
2 (22%) |
0 |
All attributed modules are currently build_status: Not started — the compliance position will update as modules are built and deployed.
| Policy |
Title |
| CRE-008 |
Product Design & Distribution Policy |
| CON-006 |
Product Suitability and Governance |
See au-corporations-act for the statutory source of DDO obligations.
Official documentation
Policies referencing this standard
- CRE-008 — Product Design & Distribution Policy
Compiled 2026-05-22 from source/entities/regulations/au-asic-rg-274.yaml