RTO Change of Ownership
On the 31st October 2019, the National Regulator implemented a new policy relating to the change of ownership of an existing RTO. On the 1st July 2025, this arrangement was updated with a new process and evidence requirement. I have had an opportunity to review the revised self-assessment document and guide and have put together this article to explain the requirements to those considering the purchase or sale of an RTO. You can access the self-assessment document and guide at the following link: Change of Ownership – Self Assessment Tool
There is a lot of complexity here so I thought I would break it down to some key points:
- Essentially submitting a change of RTO ownership notification is a compulsory requirement when 50 per cent or more of a provider’s ownership changes within a 12-month period.
- ASQA define the “50 per cent or more” where the ownership of a training provider or their parent entity/ultimate owner, changes at once or over a 12-month period.
- There is no notification fee for a change of ownership notification because it is essentially a notification of material change in the RTO operation.
- The notification needs to be accompanied by a completed self-assessment which is a substantial document that covers the Outcome Standards and the Compliance Standards 2025.
- Once the application is submitted with the supporting evidence, there is no further opportunity to supply additional or updated evidence.
- The notification for change of ownership may be subject to a regulatory audit which also means that the regulator will charge a fee to the registered entity for the conduct of the audit. We have submitted lots of these applications for clients and they have never triggered an audit. I imagine that if the evidence that you submit is non-compliant, it could trigger an audit.
- If the audit results in non-compliance, the regulator may issue a written direction to address the non-compliance, or impose conditions on the registration, for issue a notice of intent to impose sanctions or cancelled the registration. In other words, the transaction of selling the RTO now triggers a full regulatory audit and this exposes the organisation to regulatory risk. This means that the evidence submitted in the self-assessment must be highly compliant. Same as initial registration.
- The regulator has also identified that an RTO that has a change of ownership will also face additional scrutiny in the 12 months after the compliance activity is finalised. This scrutiny will be applied to any applications to change scope of registration from training providers during this period, and through a provider review at the conclusion of the period. Both of these activities may trigger regulatory action, which could include further compliance audits.
- The application is submitted on ASQAnet as a material change notification. You are required to notify ASQA of change of ownership as soon as practicable before the change takes effect or within 10 business days after the event.
The main advantage in going down this pathway is that the organisation which is purchasing the RTO can start using its registration immediately as opposed to waiting the 8 to 12 months timeframe to achieve initial registration. The cost of the change of ownership could potentially be more than initial registration application fee and you have the additional scrutiny for the first 12 months as opposed to initial registration where this additional scrutiny is 24 months.
Notification and Evidence Requirements
The evidence that must be submitted with the application is the following:
- a Financial Viability Risk Assessment Tool this must be completed as a new registration (start-up) application type
- Fit and Proper Person Declarations for any person that gains 15 per cent or more ownership of a training provider
- The relevant Self-Assessment Tool for Change of Ownership. Please note, there are two versions of this tool, a standard version and a version for ELICOS providers:
When planning the purchase or sale of an RTO, the regulatory requirements relating to the sale must be considered and incorporated into the sale process. Buyers of an RTO should be extremely wary of any RTO that is for sale that does not fully inform the purchaser of these requirements and establishes arrangements to comply with these requirements as part of the sale process. Importantly, you need to consider who is going to meet the cost of this change of ownership notification and who is going to prepare all of the evidence for the submission. This also needs to take into account if non-compliance is identified during this process and any possible sanctions or written directions. We do provide a service to assist clients with the change of ownership notification process which is outlined at the following page:
https://newberyconsulting.com.au/product/change-of-ownership/
Good training,
Joe Newbery
Published: 14th November 2019
Updated: 23rd July 2025
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