Who is the "reporting entity" — me, my agency, or my franchise?

A reporting entity is a person who provides a designated service, or the lead entity of a reporting group (AML/CTF Act 2006 (Cth) s 5). For real estate, the designated service is brokering the sale, purchase or transfer of real estate "in the course of carrying on a business" (s 6, table 5, item 1). So the question is: whose business does the brokering? Settle that before anything else. Enrolment, the compliance officer and the programme all hang off the answer.

Sole traders. If you broker through your own business as an individual, you are the reporting entity. The Act also makes you the "governing body" (s 5). That means the governing-body duty in s 26H falls on you personally: oversee the risk assessment and compliance, and take reasonable steps to make sure the business manages its risks and complies. AUSTRAC's guidance accepts that one person can hold all three governance roles: governing body, senior manager and AML/CTF compliance officer. The Rule 5-7 requirement for the compliance officer to report to the governing body does not apply where they are the same individual (Rule 5-7(3)). You still have to meet the compliance officer eligibility rules in s 26J, including being a resident of Australia and a fit and proper person.

Single-office agencies. The reporting entity is usually the company that signs the agency agreements and carries on the brokering business. Directors are not the reporting entity. They can still be personally exposed, because a person who is knowingly concerned in, or aids, a contravention of a civil penalty provision contravenes s 174.

Partnerships and trusts. For a partnership, the Act imposes the partnership's obligations on each partner, and any partner can discharge them (s 237). A trust is a "person" under the Act (s 5). Where a trust has two or more trustees, its obligations fall on each trustee (s 239). If your agency trades through a trust, take advice on how this applies to your structure.

Multi-office groups. The answer follows the legal structure, not the shopfronts. If several offices trade through one entity, that entity enrols once (s 51B) and has one programme. If each office is a separate company that brokers sales, each one is a reporting entity.

Franchises. A franchisor that does not broker sales itself does not provide the designated service. Each franchisee entity that does is its own reporting entity. Head-office templates and training can help, but the franchisee's programme must reflect its own business. The Act requires policies appropriate to the nature, size and complexity of the reporting entity's business (s 26F(1)(c)).

Reporting groups. Designated business groups were replaced by reporting groups from 31 March 2026. There are two kinds.

• Business groups (s 10A(1)(a), (3)). Where one person controls each of the others and at least one member provides a designated service, the group is a reporting group automatically. The exception is where a member that is a reporting entity gives the other reporting entities written notice that it declines (Rule 2-1(1)). The lead entity is appointed in writing by the controller or agreed in writing by the eligible members. The group must not run without a lead entity for more than 28 days (Rule 2-1(2)–(3)).
• Elective groups (s 10A(1)(b)). Businesses with no control link can form a group, each member electing in writing. There is no requirement that members be related, and AUSTRAC gives franchises and agency networks as examples. The lead entity must meet Rule 2-2(3), including that the other members have agreed it can determine the outcome of decisions about their AML/CTF policies.

What a reporting group changes:

• Shared policies. Each member must comply with the lead entity's AML/CTF policies that apply to it, as well as its own (s 26G).
• Discharge by another member. Any member may discharge another member's obligation, subject to the Rules, which include that the group has a lead entity (s 236B(5); Rule 2-3).
• Lead entity as provider. For the Parts of the Act on programmes, CDD, enrolment and record-keeping, and for AUSTRAC notices, the lead entity is treated as also providing each member's designated services (s 236B(2)).
• Shared liability. If a member contravenes a civil penalty provision, the lead entity is taken to have contravened it too (s 236B(6)).

A reporting group shares the work. It does not move liability away from the member that provides the service; it adds the lead entity as a second party liable. Section 26U only changes how "nature, size and complexity" is measured for the lead entity: across the whole group.

What to do next. Confirm with your accountant or lawyer which legal person in your structure carries on the brokering business. If you control, or are controlled by, another business that provides designated services, you may already be in a reporting group by default. Check whether you have a lead entity in writing, or whether anyone has given notice declining.