RG 271 allows financial firms to exceed the maximum IDR timeframe in certain circumstances. AFCA has updated its IDR and post-IDR referral extension policies, having regard to RG 271.

IDR referral extension policy

When AFCA receives a complaint that has not completed IDR, AFCA will refer the complaint back to the financial firm for the balance of the maximum IDR timeframe.

If the complaint is particularly complex or there are circumstances beyond the financial firm’s control (as defined in RG 271), the firm may request a time extension.

More information on the maximum timeframe extension can be found in RG 271.63.

The IDR extension request process only applies to complaints first received by a financial firm on or after 5 October 2021 (regardless of when the complaint was lodged with AFCA).

Post-IDR referral extension policy

To ensure our approach to post-IDR extension requests is consistent with RG 271, and to simplify our policies and make them easier to understand, AFCA is also updating its post-IDR extension request policy to match the IDR extension request process.

From 1 April 2022, AFCA’s post-IDR extension request policy will:

• Only apply to complaints at post-IDR referral status 
• Align with the IDR referral extension policy but with a maximum 7 day extension timeframe. This includes automatically granting extensions requested by financial firms, and if the complainant subsequently objects to the extension reverting to the original due date for the firm to provide its response. 

Requesting to extend the refer back period

Before making an extension request to AFCA

• If a financial firm determines that a complaint is particularly complex, or there are circumstances beyond its control, it can make a request to AFCA for an extension to the IDR and post-IDR response due date.
• RG 271 requires the financial firm to send an IDR delay notification to the complainant to explain the reasons for the delay. AFCA expects financial firms to send the notification to the complainant prior to sending an IDR or post-IDR extension request to AFCA.
• Upon sending the extension request to AFCA, the financial firm is not required to provide AFCA a delay notification or any other documentation for an extension to be granted.

All IDR and post-IDR extension requests should be submitted via the Member Portal no later than 5 days before the original response due date.

In pursuit of best practice, AFCA expects financial firms to:

• In addition to providing an IDR delay notification, contact the complainant to obtain their consent prior to requesting an extension at AFCA. We will act on the assumption that the financial firm has already reached out to the complainant about the request for more time and that the complainant has agreed.
• Request an extension as early as possible during the refer back period

AFCA receives an extension request

 

Image

 

• Once AFCA receives the request, an extension of 14 calendar days will be granted for IDR complaints, or 7 days for post-IDR complaints, unless;
  • The request is received within five days of the due date
  • A request has already been granted.
  • The complainant does not agree to the extension and requests the complaint progress on the original due date. 
• AFCA will not make an assessment on whether a complaint is complex or there are circumstances beyond the financial firm’s control.
• Upon granting an extension AFCA will notify the complainant and financial firm of the new IDR or post-IDR response due date.

 Following the extension

• If a complainant is notified of an extension and objects, AFCA will revert to the original due date, if the original due date has passed the complaint will progress directly to Case Management. This is consistent with RG 271.66 which provides the right for a complainant to escalate their concern to AFCA if they are unsatisfied with the reasons for the delay.

Reporting to ASIC

Under ASIC RG 267.74, AFCA is required to report quarterly to ASIC, including providing information on “firms’ performance in resolving complaints at the refer back stage”.

From 5 October 2021, AFCA will begin reporting to ASIC information on extension requests. At a minimum, AFCA will also report the following to ASIC on a regular basis:

• How often individual financial firms are requesting extensions.
• How often complainants are objecting to the extensions.

AFCA will also develop ways to report on the extension request process in future Annual Review and AFCA Datacube releases. Note: the AFCA Datacube includes data on firms with 4 or more complaints in the six-month period.

---

Frequently asked questions

What are reasons to extend the IDR refer back period?

RG 271 outlines the circumstances in which a financial firm may not be required to provide a complainant with an IDR response within the maximum IDR timeframe.

RG 271 requires the financial firm to send an IDR delay notification to the complainant to explain the reasons for the delay.

In pursuit of best practice, AFCA expects financial firms to:

• send the notification to the complainant prior to sending an extension request to AFCA
• contact the complainant to obtain their consent prior to requesting an extension at AFCA. We will act on the assumption that the financial firm has already reached out to the complainant about the request for more time and that the complainant has agreed.
• request an extension as early as possible during the refer back period

For further details about a financial firm’s obligations under RG 271, including information about complaint management delays, please refer to the ASIC website.

How do members request an extension to the refer back period on a complaint lodged with AFCA?

Members can request an extension to the refer back period on complaints lodged at AFCA via the Member Portal.

Requesting an extension from AFCA is in addition to any obligations a financial firm has under RG 271 to inform the complainant of the reasons for any delay issuing an response.

For further details about a financial firm’s obligations under RG 271, please refer to the ASIC website.

Do members need proof the complainant agrees to the extension?

AFCA does not require financial firms to provide supporting documentation if a firm is requesting an extension to the refer back period on a complaint lodged with AFCA for reasons outlined in RG 271.

While AFCA does not require any supporting documentation, we encourage financial firms to obtain consent for an extension of time from the complainant prior to requesting the extension from AFCA. If AFCA grants an extension and the complainant subsequently objects to it, the original due date will apply. If the original due date has already passed, the complaint will immediately progress to Case Management.

This is in addition to any obligations financial firms have under RG 271 to inform complainants of the reasons for any delay issuing a response.

For further details about a financial firm’s obligations under RG 271 please refer to the ASIC website.

What happens if I am unable to reach the complainant to gain consent for the extension prior to making the request to AFCA?

You still can request the extension at AFCA, however please be aware that if the complainant subsequently objects to the extension the original due date will apply.

Requesting an extension from AFCA is in addition to any obligations a financial firm has under RG 271 to inform the complainant of the reasons for any delay issuing a response.

Does the complainant have to explain/give reasons for objecting to an extension?

No, the complainant is not required to provide any explanation or give reasons why they object to an extension being granted. This aligns with a complainant’s ability to escalate a complaint to AFCA after receiving a delay notification, as outlined in RG 271.

If a complainant objects to an extension request after the original due date and the complaint immediately progresses to Case Management, is this considered a non-response for the financial firm?

No. If a complainant objects to an extension request after the original due date has already passed, this will not be considered a non-response for reporting purposes for the financial firm.

Will this system be abused by some firms?

We expect financial firms to adhere to AFCA policies, procedures, and guidelines (which are supported by the AFCA Rules and Operational Guidelines), as well as applicable regulatory obligations.

Consistent with our obligations under RG 267, AFCA will be providing data relating to delays and extension requests to ASIC. We will also review adherence to our policies on a regular basis to ensure compliance.

Will extensions about specific firms be reported to ASIC?

Yes. Consistent with our obligations under RG 267, AFCA will be reporting detailed data to ASIC on an identified basis including (at a minimum):

• How often individual financial firms are requesting extensions.
• How often complainants are objecting to the extensions.

Can complainants ask for an extension?

Yes. Complainants can request an extension by contacting AFCA. If AFCA receives an extension request from a complainant, this will be considered on a case by case basis.

Does the financial firm still need to provide the complainant an IDR delay notification?

Yes. A financial firm’s obligations under RG 271 exist regardless of whether a complaint is lodged with AFCA.

For further details about a financial firm’s obligations under RG 271 please refer to the ASIC website.

Can a financial firm request an extension for other reasons?

In limited exceptional circumstances AFCA may consider an extension for other reasons. Generally, this will only occur:

• If the complaint is close to resolution.
• With a complainant’s prior consent.
• For a maximum of seven days.

If you feel that exceptional circumstances may apply, please contact AFCA to discuss.