Do sole traders need to hold AFSL with derivative authorisations (margin lending + CFD + binary)?

No. Across every industry and every size band, the engine's answer for a sole trader is: no.

Do businesses with 1–5 employees need to hold AFSL with derivative authorisations (margin lending + CFD + binary)?

No (1–5 employees, turnover $100K–$1M).

Who must hold AFSL with derivative authorisations (margin lending + CFD + binary)?

The applicability test for Hold AFSL with derivative authorisations (margin lending + CFD + binary) (ASIC), computed across 35 industries, 9 business structures and 6 size bands.

Short answer: Only if

Applies only if you issue OTC derivatives to retail clients. Whether it applies turns on a fact that no industry, structure or size settles on its own.

What the obligation is

Issuers of OTC derivatives to retail clients face product intervention orders + tightened conditions.

Margin lending + CFDs + binary options for retail clients have been subject to ASIC product intervention orders (binary options banned 2022; CFD leverage caps + restrictions; margin lending tighter financial assistance rules). Issuers must hold appropriate AFSL authorisations + observe intervention orders.

The applicability test

Applies only if you issue OTC derivatives to retail clients. Whether it applies turns on a fact that no industry, structure or size settles on its own.

How the regulator frames it: AFSL holders issuing OTC derivatives to retail clients.

What triggers it: Issuing covered derivatives.

Jurisdiction: Commonwealth law, so the test is the same in every state and territory.

Which industries are in or out

Outcome across the 35 industries Rules Mate maps (35 of 35: no).

The answer is the same in every industry: no. Industry does not change who must comply.

Business structure and size

Structure does not change the answer across all industries: for every structure the answer is "no".

Size does not change the answer across all industries: at every size band the answer is "no".

Worked examples

Each line is one run of the Rules Mate applicability engine for a single business profile, with the reason the engine gives:

Pty Ltd company in real estate agents with 6–19 employees, turnover $1M–$3M: does not apply. Requires a trigger outside this questionnaire.

When you need to check further

The engine shows this obligation as "check whether this applies" when a business has an AFSL and industry: Fintech (non-bank). It then applies only if you issue OTC derivatives to retail clients. That fact is not something Rules Mate can infer from industry, structure or size.

What you must do, and when

When due: Continuous.
Frequency: Ongoing
Evidence to keep: AFSL authorisation; product design conformance; client onboarding + suitability records.
Status: Current
Priority: Critical

Penalty for not complying

Maximum penalty: Civil penalties to financial services maximum.

Audit or assurance level

Rules Mate has not yet classified the audit or assurance level for this obligation. Any audit, review or certification requirement is set by the regulator source listed below.

Where it sits in the corpus

Rules Mate tracks 17 published obligations tagged "financial services", 12 of them rated critical. For a professional services Pty Ltd company with 6–19 employees operating in every state, 0 of those apply outright. This obligation is rated critical priority, and is an ongoing duty.

Regulator, legislation and tools

Regulated by Australian Securities and Investments Commission.

ASIC: Corporate regulator administering the Corporations Act, financial services and credit licensing (AFSL/ACL), markets supervision, insolvency, and registries (ASIC and ABRS).

Australian Securities and Investments Commission

Corporations Act: The foundational federal Act for Australian corporate law.

Corporations Act 2001

Free tools that help with this obligation:

Run the compliance journeyAnswer a short questionnaire about your business and get the obligations that apply to you, with the reason each one applies.

Questions

Who must hold AFSL with derivative authorisations (margin lending + CFD + binary)?: Applies only if you issue OTC derivatives to retail clients. Whether it applies turns on a fact that no industry, structure or size settles on its own.
Do sole traders need to hold AFSL with derivative authorisations (margin lending + CFD + binary)?: No. Across every industry and every size band, the engine's answer for a sole trader is: no.
Do businesses with 1–5 employees need to hold AFSL with derivative authorisations (margin lending + CFD + binary)?: No (1–5 employees, turnover $100K–$1M).
When is "Hold AFSL with derivative authorisations (margin lending + CFD + binary)" due?: Continuous.

Sources

Computed by the Rules Mate applicability engine from the published obligation corpus; facts last checked 3 October 2026. Rules Mate is not a law firm and this is general information, not legal advice. Confirm your position with the regulator source or a qualified adviser before acting.