On 16 October 2025, AUSTRAC released its much-anticipated new regulatory guidance on Australia's anti-money laundering and counter-terrorism financing (AML/CTF) regime (Guidance).

For many new and existing reporting entities that have been anxiously waiting for the guidance to be released, this will be the trigger to push ahead on the measures needed to implement the revised regime which commences on 31 March 2026 for those already subject to the regime and 1 July 2026 for new regulated entities.

The Guidance provides valuable direction on the interpretation and practical application of the significant reforms to the AML/CTF regime (effected by the Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024 (Bill)).

Design and purpose 

The Guidance is designed to help all 'reporting entities' understand and comply with their obligations under the new AML/CTF regime, while also promoting greater consistency and certainty across regulated sectors.

AUSTRAC’s Guidance aims to:

• Clarify core concepts and obligations under the reformed AML/CTF regime.
• Assist reporting entities in interpreting the scope of designated services and recent legislative changes.
• Provide practical examples and scenarios to support effective implementation and day-to-day compliance.
• Address industry feedback and concerns raised during consultation.
• Promote consistency, confidence, and best practice across the financial, legal, and professional services sectors.

Key insights

The Guidance is lengthy and will take all affected businesses some time to digest.  A few significant aspects that caught our attention at this stage are:

What it means to be 'assisting' for newly-regulated professional and real estate services

The new 'Tranche 2' designated services that captures professional services apply where a business is involved in 'assisting' or ‘otherwise acting on behalf of' another person in relation to a relevant transaction.  

AUSTRAC helpfully provides its views on what it means for a person to be 'assisting' for the purposes of the new Table 6 designated services.  This clarification is particularly relevant for legal, accounting, and other professional service providers, as it defines the boundaries of when professional involvement in a transaction may trigger AML/CTF obligations.

According to AUSTRAC, a person's actions must be sufficiently linked to the outcome of the designated service for it to be regulated – which in turn requires the person's assistance to directly advance the relevant transaction (or the creation/restructure of a body corporate or legal arrangement).

Importantly, AUSTRAC distinguishes between assisting and merely influencing how the customer proceeds, providing general advice or ancillary services – stating the latter isn't sufficient.

AUSTRAC also provides guidance on when a person will commence to provide one of the new Tranche 2 designated services.  AUSTRAC says that will be the point at which they act on instructions in relation to a relevant transaction, which will typically be when two or more parties to a transaction exist or when preparatory steps are taken to create or restructure a corporate body or legal arrangement.

This clarification should operate to ensure obligations under the regime apply only to professional services that pose genuine ML/TF risks, while excluding ancillary or advisory roles that do not directly advance the transaction.

Examples and exclusions

The Guidance includes various examples of activities that do and don't, fall within the scope of designated services. 

For example, one of the new designated services is brokering, planning, or executing the sale, purchase, or transfer of real estate.  AUSTRAC states that this will include preparing contracts, conducting title searches or holding funds in trust, even if the transaction does not ultimately proceed.

However, some activities are specifically excluded. General or hypothetical advice (such as discussing the pros and cons of property ownership before a client decides to buy), simple referrals to third parties, or transactions involving short-term leases or court-ordered transfers are not designated services. For example, a conveyancer preparing a contract for the sale of real estate after the buyer and seller agree on price is assisting, whereas a solicitor advising on the legal effect of contract terms without taking steps to execute the transfer is not.

Businesses that may potentially provide one or more of the new designated services should therefore carefully review their service offerings to determine whether their involvement will trigger AML/CTF obligations.

Incidental value transfers clarified

The Guidance includes AUSTRAC's views about when the incidental service exemption in section 63A of the AML/CTF Act will apply.  That exemption specifies that a transfer of value that is reasonably incidental to another service will not be regulated – noting that the other service does not have to be a designated service.

This exemption does not apply to financial institutions and, to the extent it involves an international value transfer service, gambling service providers, currency exchanges and virtual asset service providers.

AUSTRAC provides a number of detailed examples of where the exemption applies.  That list of examples should be reviewed in full but the following examples suggest AUSTRAC may be adopting a broader interpretation of section 63A and therefore reducing compliance burdens for potentially lower-risk activities:

• a stockbroker that sells shares on behalf of a customer and transfers the proceeds to the customer’s bank account.  AUSTRAC says the transfer of value is incidental to stockbroking services (although the stockbroking services are likely to be a designated service in their own right);
• selling gift cards that can only be used with certain retailers and then transfer the value to retailers when the gift cardholder buys goods or services.  AUSTRAC says the transfer of value is incidental to retail services (although a separate ‘stored value card’ designated service could be provided depending on the value of the gift card); and
• operating an online marketplace and transferring value from people buying goods and services via a financial institution or remitter to the retailers of those services.  AUSTRAC says the transfer of value is incidental to retail services.

AUSTRAC does make it clear that if the service you are providing is a specialised value transfer service (however described or named), then the value transfer service is not reasonably incidental.

Risk-based approach reaffirmed

AUSTRAC’s Guidance emphasises an outcomes-focused, risk-based approach to compliance. Entities must assess money laundering, terrorism financing, and proliferation financing risks across customers, products, delivery channels, and jurisdictions, and apply controls proportionate to those risks. 

Recent finalisation of the AML/CTF Rules 

In case you missed it, AUSTRAC finalised the Anti-Money Laundering and Counter-Terrorism Financing Rules 2025 (New Rules) on 29 August 2025. The new AML/CTF Rules operationalise the major reforms to the AML/CTF Act.

Detail and Clarity

The New Rules provide finer detail on core obligations, including:

• Reporting group arrangements and lead entity requirements
• The content requirements for an AML/CTF program 
• Specific information required for enrolment, registration, suspicious matter reporting, threshold transaction reporting, and value transfers
• Initial and ongoing customer due diligence (CDD) obligations, including minimum requirements for certain types of customers
• Simplified and enhanced due diligence measures, including for politically exposed persons (PEPs) and high-risk scenarios
• New and clarified requirements for the 'travel rule' in value transfers, including virtual assets
• Updated compliance reporting and record-keeping requirements

Outcomes-Based Approach

The aim for the New Rules is shift the regime towards an outcomes-based framework, aiming to simplify and clarify compliance for businesses.  Although that does appear to have been achieved, the New Rules still contain various prescriptive requirements as described above.

Topical Structure

The New Rules are now organised in a topically structured format that mirrors the typical engagement of a reporting entity with the regime, from enrolment and registration through to customer due diligence, reporting, and compliance management.

AUSTRAC has said it will publish a summary of feedback and responses to key issues raised during the consultation process leading up to the finalisation of the Rules.

Transitional rules

Also important to note are the transitional arrangements allowing for a phased implementation of the New Rules.  In particular:

• Existing reporting entities can continue using existing forms for suspicious matter and threshold transaction reports until 2029 (as per Rules 12-1 to 12-4).  Existing reporting entities will therefore have a multi-year window to update their systems, policies, and reporting processes to meet some of the new AML/CTF requirements. In contrast, new reporting entities must comply with the new regime from the outset.
• Customer identification procedures completed under the (old) Rules before 31 March 2026 are recognised as compliant under the new regime, so existing customers do not need to be re-verified according to Rule 6-42 and 6-43. 

All businesses should plan for full transition to the new reporting forms and requirements by end of March 2029, as well as reviewing any of their ongoing exemptions or special arrangements to ensure they remain valid under the new framework.

The old Rules

The existing AML/CTF Rules do not disappear entirely.  With the introduction of the New Rules 2025, AUSTRAC has amended the existing AML/CTF Rules to remove most of the current content but retain a small number of existing class exemptions (with some amendments).  

The revised instrument is now called the Class Exemption Rules and its existence is time-limited and will automatically expire on 31 March 2031, allowing for further review to ensure they remain appropriate as the regime evolves.

What's next?

AUSTRAC has said that in early 2026, they will publish additional tailored guidance (including sector-specific examples addressing key issues raised by industry bodies) for the following tranche 2 entities: 

• accountants
• lawyers
• real estate professionals – including real estate agents, buyers' agents and conveyancers
• dealers in precious metals, stones and products – particularly jewellers.

AUSTRAC will also release a starter program kit for small, low-complexity businesses in these industries.  You should expect that kit to help develop your ML/TF risk assessment and AML/CTF policies.

AUSTRAC’s new Guidance is the moment that many new and existing reporting entities have been waiting on to kick-start their projects to implement compliance for the reforms – that time has now arrived.  By no means is this the end of road as we expect AUSTRAC will continue to review and adjust its Guidance appropriately to address changing business practices and legislative requirements.  However, for the time being the Guidance provides much-needed clarity on new and existing obligations, aiming to simplify compliance, address sector feedback, and ensure Australia’s defences against financial crime remain robust and future focused.  

Entities are encouraged to review the AUSTRAC's Guidance closely and consider the practical implications for their operations. If you require any assistance in relation to compliance with the AML/CTF regime, please contact our team of AML/CTF experts.