A designated business group (DBG) is a group of two or more reporting entities who join together to share the administration of some or all of their anti-money laundering and counter-terrorism financing obligations (such as an AML/CTF program or record-keeping). Any member of the group can fulfil some of the obligations for the other members. However each reporting entity is still ultimately responsible for meeting its own AML/CTF obligations.

Who can form a designated business group

Reporting entities must meet certain criteria to be eligible to form a DBG, and can be asked to prove how they meet this criteria. For example, they may be asked to show evidence of a joint venture agreement, or show how they are related to other group members (as specified in section 50 of the Corporations Act 2001).

Instances where reporting entities can form a DBG are listed below.

Members of a joint venture

A DBG can be formed by reporting entities in a joint venture where there is a legal contract setting out the arrangements of the joint venture.

To form a DBG, each member must provide designated services under that agreement.

Related companies

A DBG can be formed by reporting entities from related companies. Each member must be one or more of the following:

  • a holding company of another member
  • a subsidiary of another member
  • a subsidiary of a holding company of another member.

A company in a foreign country that would be a reporting entity if it was a resident of Australia can also be part of a DBG made up of related companies.

Registrable remittance service providers

Providers of registrable designated remittance services can form a DBG if they are one of the following:

  • a money transfer service provider
  • a representative of a money transfer service provider
  • a sub-representative of a money transfer service provider (an individual, business or organisation engaged to provide a money transfer service under a sub-representation agreement).

Accounting and legal practices

Accounting and legal practices may also form a DBG if they meet certain conditions. See Part 2.1 of Chapter 2 of the AML/CTF Rules for more information.

Establishing a designated business group

Any two or more reporting entities who want to form a DBG must agree in writing to become members of the group. An entity can only be a member of one DBG at a time.

The group must appoint a nominated contact officer. This individual is responsible for establishing the DBG and notifying AUSTRAC of any changes in the group. A nominated contact officer must be either:

  • an officer of one of the DBG members (according to the definition of officer in section 9 of the Corporations Act 2001, such as a director or company secretary)
  • the AML/CTF compliance officer of a group member.

To establish the group, the nominated contact officer must submit the appropriate forms via AUSTRAC Online.

  • Form 1: Election to be a member of a designated business group – this form is used to elect members to a DBG. A separate form must be submitted for each proposed group member.
  • Form 2: Formation of a designated business group – this form is used to establish the DBG.

Templates for these forms are also in chapter 2 of the AML/CTF Rules. These can be submitted in hardcopy, but online submission is preferred.

AML/CTF obligations members of a DBG can share

Members of a DBG can use a joint AML/CTF program instead of an individual program to meet their obligations under the AML/CTF Act. The joint program must include both Part A and Part B requirements. Any DBG member can also choose to administer their own AML/CTF program, separate from the group.

Other AML/CTF obligations that any member can carry out for other members of the group include:

  • keeping verification information about requests to credit reporting agencies
  • conducting ongoing customer due diligence
  • lodging AML/CTF compliance reports with AUSTRAC
  • recording designated services
  • keeping transaction records and customer transaction documents
  • making and retaining records of customer identification procedures
  • providing and retaining copies of customer identification records
  • making and keeping records of AML/CTF programs, including any variations.

Notifying AUSTRAC of changes to a DBG

DBG members must keep their information up to date. The nominated contact officer must notify us within 14 days if:

  • a member leaves the DBG
  • a member joins the DBG
  • the DBG is terminated
  • the nominated contact officer changes
  • there are any other changes to the DBG.

You must submit this information to us using Form 3: Variations which is available in AUSTRAC Online.

The content on this website is general and is not legal advice. Before you make a decision or take a particular action based on the content on this website, you should check its accuracy, completeness, currency and relevance for your purposes. You may wish to seek independent professional advice.

Last updated: 15 Jan 2024
Page ID: 298

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