Wholesale Client

Wholesale clients, also called sophisticated or professional investors, are individuals or organizations that meet specific criteria under section 761G of the Corporations Act 2001. They receive reduced regulatory protections on the basis they have sufficient knowledge, experience, and resources to make informed decisions without extensive disclosure. Wholesale client categories include: businesses with 100+ employees (for general insurance) or 20+ employees (for financial products); individuals or entities investing $500,000 or more; individuals with net assets of $2.5 million+ or gross income of $250,000+ per year (certified by a qualified accountant); professional investors like AFSL holders or registered trustees; and listed entities or related bodies corporate. Wholesale clients do not receive: Product Disclosure Statements; cooling-off rights; certain conflicted remuneration protections; or automatic access to AFCA (though some may access AFCA under specific circumstances). The reduced protections reflect that wholesale clients can negotiate terms directly, conduct due diligence, and access independent advice. Financial service providers must properly assess and document wholesale client classification - improper classification to avoid obligations is a serious breach.