(1) If a financial services licensee provides a financial service to persons as retail clients, the licensee must have arrangements for compensating those persons for loss or damage suffered because of breaches of the relevant obligations under this Chapter by the licensee or its representatives. The arrangements must meet the requirements of subsection (2).
(2) The arrangements must:
(a) if the regulations specify requirements that are applicable to all arrangements, or to arrangements of that kind--satisfy those requirements; or
(b) be approved in writing by ASIC.
(3) Before approving arrangements under paragraph (2)(b), ASIC must have regard to:
(a) the financial services covered by the licence; and
(b) whether the arrangements will continue to cover persons after the licensee ceases carrying on the business of providing financial services, and the length of time for which that cover will continue; and
(c) any other matters that are prescribed by regulations made for the purposes of this paragraph.
(4) Regulations made for the purposes of paragraph (3)(c) may, in particular, prescribe additional details in relation to the matters to which ASIC must have regard under paragraphs (3)(a) and (b).