ASIC Regulatory Guide RG 274, plain-English definition from TheAICommand
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What is ASIC Regulatory Guide RG 274?

RG 274 Product design and distribution obligations is ASIC's guidance for issuers and distributors subject to Part 7.8A of the Corporations Act. It explains ASIC's interpretation of the target market determination and reasonable steps obligations. Current version issued 10 September 2024.

Quick answer

RG 274 is ASIC's regulatory guide on the design and distribution obligations in Part 7.8A of the Corporations Act. It is written for issuers and distributors of financial products and explains ASIC's interpretation of the obligations, its expectations for compliance, and its general approach to administering them.

Verified against the current authoritative text on by the editorial team at TheAICommand.

This page is an educational summary for professionals working with AI. It is not the law and not legal advice. Always work from the current authoritative text linked below.

What does RG 274 do?

RG 274 explains ASIC's interpretation of the design and distribution obligations, its expectations for compliance, and its general approach to administering them. It walks through the target market determination content requirements in section 994B(5), including review triggers, which are events that reasonably suggest the determination is no longer appropriate, and through the separate obligation to take reasonable steps so that distribution is consistent with the determination. Read the guide on the ASIC website.

Who does it bind?

Strictly, nothing. The binding obligations are in Part 7.8A of the Corporations Act 2001 and fall on issuers and distributors of financial products. RG 274 is guidance, and ASIC administers the statutory obligations against it.

What do practitioners get wrong?

Treating the target market determination as the whole compliance task. It is not. The design and distribution obligations also impose a standing reasonable steps duty on distribution conduct, which is where most supervisory attention lands.

Where does AI use touch it?

Distribution targeting. A model that selects who sees a product, or personalises how it is presented, is a distribution step that must remain consistent with the determination, and its behaviour needs to be observable enough to feed the review triggers. See DDO and AI-driven personalisation and boundary testing a TMD.

Bottom line

RG 274 is ASIC's reading of Part 7.8A, not the obligation itself. Read it for what a defensible determination and defensible distribution conduct look like.

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Frequently asked questions

Does RG 274 create the design and distribution obligations?
No. The obligations are statutory and sit in Part 7.8A of the Corporations Act, inserted by the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Act 2019. RG 274 is a regulatory guide. It explains how ASIC interprets those obligations and how it will administer them.
What must a target market determination contain?
RG 274 summarises the content requirements in section 994B(5). A TMD must describe the target market class of consumers, specify distribution conditions and restrictions, specify review triggers, specify when the first and subsequent reviews must occur, specify reporting periods for complaints information, and specify what information distributors must report to the issuer.
What is the reasonable steps obligation?
RG 274.11 states that issuers and distributors must take reasonable steps that will, or are reasonably likely to, result in distribution being consistent with the target market determination. ASIC frames this as a risk management approach, reducing the risk of distribution inconsistent with the TMD rather than guaranteeing a perfect outcome.
Which version of RG 274 is current?
The version issued on 10 September 2024, dated September 2024 on its cover. ASIC published an accompanying summary of changes for that release. Regulatory guides are reissued rather than amended in place, so the published date on the guide itself is the version marker to cite.

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General information and education only. Not legal, compliance, financial, or professional advice. Always confirm obligations against the primary source and current regulator guidance.