RG 271: Internal Dispute Resolution

RG 271 applies to complaints received by financial firms on or after 5 October 2021

Financial firms have until October 2021 to put in place all that is necessary for the new complaint handling requirements under Regulatory Guide 271: Internal Dispute Resolution (RG 271).

The new guidance is intended to ensure better outcomes for consumers by ensuring that complaints are resolved in a fair, effective, and timely manner - and reduce the need to escalate complaints to external dispute resolution. It attempts to address the requirements of both complainants and financial services firms by ensuring that the various standards are achievable and practical.

Failing to meet the RG 271 obligations may even be considered a breach of the Australian Financial Services Licence condition to comply with all applicable financial service laws and regulations.

Internal Dispute Resolution

The Australian Securities and Investments Commission (ASIC) considers that consumer and small business access to fair, timely and effective dispute resolution is an essential part of the financial services consumer protection framework. RG 271 quotes the Ramsay Review:

"Effective Internal Disputes Resolution (IDR) benefits both firms and consumers. IDR is an important element of financial firms’ overall relationship with their customers and is the primary avenue for aggrieved consumers to seek redress. Pressure on [external dispute resolution] is reduced when complaints are resolved directly between firms and their customers."

Complaints definition

The revised RG 271 definition of a complaint is as follows:

"[an expression] of dissatisfaction made to or about an organisation, related to its products, services, staff or the handling of a complaint, where a response or resolution is explicitly or implicitly expected or legally required". Furthermore ASIC has stated that it expects a financial firm to take a proactive approach to identifying complaints."

RG 271 also contains guidance relating to social media posts, where a comment can be deemed to be a complaint if the comment is posted on an account or media channel owned by the financial firm, where the author of the post is identifiable and contactable.

Complaints must be recorded and acknowledged

A fit-for-purpose and effective system for recording information about complaints is required so as to enable tracking of the progress of every complaint received. Regular reporting to senior management and the Board concerning complaint data and progress is also required.

Reduced time for response

For "standard" complaints received on or after 5 October 2021, an Internal Dispute Resolution (IDR) response must be provided within 30 days of the complaint being received rather than 45 days, as previously allowed. Different response timeframes apply to other types of complaints.

For more information, please refer to ASIC's entry for RG 271 Internal dispute resolution.

Pali GRC will help you comply with RG 271

  • Easy to keep up to date as requirements change.
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Please contact us to find out more and arrange a demonstration.

Pali

Pali GRC simplifies your governance, risk and compliance (GRC) activities so you can stay a step ahead of uncertainty, and meet all your stakeholder expectations.

ProbityPro

ProbityPro™ manages the complete probity and procurement cycle, with the flexibility needed to accommodate an organisation's nomenclature, procurement processes and governance, workflows and more.