If you pool money from investors, you're probably running a managed investment scheme. The next question is whether it has to be registered with ASIC — and the answer shapes your structure, your costs and who can operate the fund. It also generates more terminology confusion than almost anything else in this area, because three different distinctions get used interchangeably: registered/unregistered, listed/unlisted, and retail/wholesale.
A registered scheme is registered with ASIC and must be operated by a responsible entity — a public company holding an AFSL with retail authorisations — with extra obligations including a compliance plan lodged with ASIC. An unregistered scheme isn't registered, is generally offered only to wholesale clients, and is operated by a trustee instead. Registration is generally required where a scheme has more than 20 members or is promoted by someone in the business of promoting schemes — but schemes where all interests are issued to wholesale clients are generally exempt (s 601ED). Two traps: unregistered is not the same as unlisted, and being exempt from registration does not remove the licensing requirement.
First: what makes it a managed investment scheme?
Broadly, a managed investment scheme (MIS) is an arrangement where people contribute money to get an interest in the scheme, those contributions are pooled or used in a common enterprise, and the members don't have day-to-day control over its operation. That's most pooled funds, property syndicates and co-investment vehicles — even when they're small and even when everyone knows each other.
Once you're in MIS territory, registration becomes the question.
The registration test
ASIC's guidance is that a scheme generally must be registered if it has more than 20 members, or is promoted by a person who was, when the scheme was promoted, in the business of promoting schemes (ASIC: How to register a managed investment scheme; section 601ED of the Corporations Act).
The exemption that matters for wholesale funds: schemes in which all interests are issued to wholesale clients are generally exempt from registration. That's why most wholesale funds in Australia run as unregistered schemes — and why the wholesale client test does so much work in this structure.
Registered vs unregistered: what actually differs
| Registered scheme | Unregistered scheme | |
|---|---|---|
| Typical investors | Retail (and wholesale) | Wholesale clients only |
| Registered with ASIC | Yes | No |
| Who operates it | Responsible entity — a public company with an AFSL carrying retail authorisations | Trustee — holds the assets and issues the interests |
| Compliance plan | Required, and lodged with ASIC | Not required |
| Offer document | Product Disclosure Statement | Information memorandum |
| Target Market Determination | Required | Generally not required |
| AFS licence | Required, with retail authorisations | Still required — wholesale authorisations |
| Set-up & running cost | Materially higher | Lighter |
The practical summary: an unregistered wholesale scheme is lighter to run — but it is not unregulated, and it is not unlicensed.
Unregistered, unlisted, wholesale — three different things
These get used as if they're synonyms. They aren't, and mixing them up leads people to the wrong structure.
- Registered / unregistered — whether the scheme is registered with ASIC.
- Listed / unlisted — whether the interests trade on a licensed exchange such as the ASX. An unlisted managed fund simply isn't traded on market; investors apply and redeem directly with the fund.
- Retail / wholesale — the type of client the interests are issued to.
So the combinations are real: a retail managed fund is commonly registered and unlisted. A wholesale fund is typically unregistered and unlisted. Listed schemes are registered. The one thing you won't find is an unregistered scheme with retail investors quietly operating as if the rules don't apply.
Trustee or responsible entity?
This follows directly from registration, and it's the part that determines who can actually operate your fund.
For an unregistered wholesale scheme, a trustee holds and governs the scheme's assets on behalf of unitholders and issues the interests. For a registered scheme, a responsible entity operates the scheme — and an RE must be a public company holding an AFSL with retail authorisations, carrying additional obligations including a compliance plan lodged with ASIC (ASIC: Running a registered scheme).
That RE requirement is a genuine barrier: standing up a public company with retail authorisations is a different proposition from appointing a trustee. It's a large part of why emerging managers start wholesale.
Which should your fund be?
For most emerging managers the answer follows from the investors, not the other way around:
- Raising from wholesale clients only — an unregistered scheme with a licensed trustee is the standard, lighter path.
- Wanting retail money — you're into registration, a responsible entity, a PDS and a TMD. That's a much bigger build, and rarely the right first step.
The sequencing point: it's far easier to start wholesale and grow than to unwind a structure built on the wrong assumption. And if a retail investor slips into a wholesale fund, the exemption supporting your structure can fall away retrospectively.
Where an integrated platform fits
An unregistered wholesale scheme still needs a licensed trustee and issuer, an AFS licence covering the services, and the operational framework to run it. Providence Equity Holdings acts as trustee, issuer and operator of the scheme and provides the compliance and operational infrastructure, while you're onboarded as an authorised representative to run the strategy — so you don't have to stand up any of that yourself. → Managed Scheme & Trustee Infrastructure
Frequently asked questions
What's the difference between a registered and unregistered fund?
A registered managed investment scheme is registered with ASIC and must be operated by a responsible entity — a public company holding an AFSL with retail authorisations — with additional obligations including a compliance plan lodged with ASIC. An unregistered scheme isn't registered, is generally offered only to wholesale clients, and is operated by a trustee. Most wholesale funds in Australia are unregistered. Being unregistered doesn't remove the requirement to be covered by an AFS licence.
Does my fund need to be registered with ASIC?
Generally only if it has retail investors. ASIC's guidance is that a scheme generally must be registered if it has more than 20 members or is promoted by someone in the business of promoting schemes — and that schemes where all interests are issued to wholesale clients are generally exempt from registration (s 601ED). So a fund offered only to wholesale clients generally isn't required to register.
Is an unregistered fund the same as an unlisted fund?
No — and they're frequently confused. Registered / unregistered describes whether the scheme is registered with ASIC. Listed / unlisted describes whether the interests trade on a licensed exchange such as the ASX. A fund can be registered and unlisted (common for retail managed funds), or unregistered and unlisted (the usual position for a wholesale fund). Listed schemes are registered.
What's the difference between a trustee and a responsible entity?
For an unregistered wholesale scheme, a trustee holds and governs the assets on behalf of unitholders and issues the interests. For a registered scheme, a responsible entity operates the scheme, must be a public company holding an AFSL with retail authorisations, and carries additional obligations including a compliance plan lodged with ASIC.
Do I need an AFS licence for an unregistered scheme?
Generally yes — though it doesn't have to be your licence. Being exempt from registration doesn't remove the licensing requirement: ASIC's guidance is that operators and trustees of unregistered schemes must generally still hold an AFS licence to issue, vary or dispose of interests. You can hold your own, or operate under an existing one as a corporate authorised representative while the licensee acts as trustee and issuer.
What happens if a retail investor joins an unregistered scheme?
The exemption supporting the unregistered structure can fall away and the retail regime can be triggered — registration, a responsible entity, a PDS, a Target Market Determination, AFCA membership and retail licence authorisations. This is why wholesale status should be confirmed and documented before any interest is issued.
Related reading: Independent trustee or integrated licensee? — who acts as trustee, and what that changes. Retail vs wholesale clients: who qualifies — the tests the exemption depends on. PDS or information memorandum? — the offer document that follows from this choice. And how to set up a wholesale fund.
Sources & further reading (ASIC)
This page draws on guidance published by ASIC. For the authoritative position, see:
- How to register a managed investment scheme — the registration test (s 601ED) and the wholesale-client exemption
- Running a registered scheme — responsible entity obligations
- Do you need an AFS licence? — dealing in a financial product includes issuing interests in a scheme
ASIC guidance is general and doesn't address your circumstances — confirm how it applies to you with your own adviser.