Schedule 1 Amendments
(regulation 3)
[1] Subregulation 1.0.02 (1),
after definition of Lloyds
insert
margin loan, or margin
lending, means a standard margin lending facility.
[2] Subregulation 1.0.02 (1), after definition of medical
indemnity insurance product
insert
minor fee, for a margin loan, means a fee or
cost for the margin loan that does not relate to the ordinary acquisition,
operation or closure of the loan and which is less than $10.
[3] Subregulation 1.0.02 (1), after definition of settlement
documents
insert
simple managed investment scheme means a
registered management investment scheme which is or was offered because it meets
1 of the following requirements:
(a) the scheme invests at least 80% of its
assets in money in an account with a bank on the basis that the money is
available for withdrawal:
(i) immediately during the bank’s
normal business hours; or
(ii) at the end of a fixed-term period
that does not exceed 3 months;
(b) the scheme invests at least 80% of its
assets in money on deposit with a bank on the basis that the money is available
for withdrawal:
(i) immediately during the bank’s
normal business hours; or
(ii) at the end of a fixed-term period
that does not exceed 3 months;
(c) the scheme invests at least 80% of its
assets under 1 or more arrangements by which the responsible entity of the
scheme can reasonably expect to realise the investment, at the market value of
the assets, within 10 days.
[4] After subregulation 7.7.08A (1A)
insert
(1A) This regulation does not apply if the Product
Disclosure Statement is for an FHSA product.
(1B) This regulation does not apply if the Product
Disclosure Statement is for a margin loan.
(1C) This regulation does not apply if the Product
Disclosure Statement is for a superannuation product to which Subdivision 4.2B
of Division 4 of Part 7.9 applies.
(1D) This regulation does not apply if the Product
Disclosure Statement is for a simple managed investment scheme to which Subdivision
4.2C of Division 4 of Part 7.9 applies.
[5] Paragraph 7.9.09 (1) (d)
substitute
(d) FHSA products; and
(e) a margin loan; and
(f) a superannuation product to which Subdivision
4.2B of Division 4 of Part 7.9 applies; and
(g) a simple managed investment scheme to which Subdivision
4.2C of Division 4 of Part 7.9 applies.
[6] Part 7.9, Division 4, after Subdivision 4.2
insert
Subdivision 4.2A Form and content
of Product Disclosure Statement for margin loan
7.9.11 Application
of Subdivision 4.2A
This Subdivision applies to:
(a) a person who is required to prepare a
Product Disclosure Statement for a margin loan; and
(b) a Product Disclosure Statement for a margin
loan.
7.9.11A Provisions of Part 7.7 of Act that do not apply in relation
to margin loan
For paragraph 951C (1) (b) of the Act,
section 942DA of the Act does not apply in relation to a margin loan.
7.9.11B Definitions for Subdivision
4.2A
(1) In this Subdivision and in Schedule 10C:
Approved Securities List means the list of
secured properties that are acceptable for the provider or potential provider
of a margin loan as security for the margin loan and includes the amount of
credit the provider will give for each of the properties.
(2) In this Subdivision and in Schedule 10C, a provision
of the Act that is modified in accordance with regulation 7.9.11C is referred
to as modified.
Example
Paragraphs 1013C (1) (a) and (b) of the Act as
modified by subitem 5A.2 (1) of Part 5A of Schedule 10A are referred to in
this Subdivision as ‘modified paragraphs 1013C (1) (a) and (b)’.
7.9.11C Modification of Act — margin
loan
For paragraph 1020G (1) (c) of the Act,
Part 7.9 of the Act is modified in its application to a margin loan as set out
in Part 5A of Schedule 10A.
7.9.11D Form and content of Product
Disclosure Statement for margin loan
(1) For modified paragraph 1013C (1) (a) of
the Act, a Product Disclosure Statement for a margin loan must include the
information and statements mentioned in Schedule 10C.
(2) For modified paragraph 1013C (1) (b) of
the Act, a Product Disclosure Statement for a margin loan must be in the form
mentioned in Schedule 10C.
7.9.11E Requirements for references
to incorporated information for margin loan
(1) For subsection 1013C (1B) of the Act, as
modified by Part 5A of Schedule 10A, this regulation prescribes
requirements for applying, adopting or incorporating, in a Product Disclosure
Statement for a margin loan, a matter contained in writing.
(2) A Product Disclosure Statement may apply, adopt or
incorporate a matter only if a provision of these Regulations requires or
permits the matter to be applied, adopted or incorporated by the Statement.
(3) If a Product Disclosure Statement applies, adopts
or incorporates a matter:
(a) the matter must be:
(i) in writing; and
(ii) clearly distinguishable from any
other matters that are not applied, adopted or incorporated; and
(iii) publicly available in a document
other than the Statement; and
(b) the responsible person for the Statement
must identify the matter by:
(i) including in the Statement a
concise description of the matter; and
(ii) ensuring that the reference to the
matter is clearly distinguishable from the other contents of the Statement; and
(c) the responsible person for the Statement
must:
(i) identify each version of the matter
(by including the date on which the version was prepared) so that a person who,
at a particular time, is considering a margin loan can identify the version
that is relevant to the margin loan at that time; and
(ii) state the date on which the
version was prepared in a prominent position at or near the front of the
version; and
(d) the responsible person for the Statement
must ensure that a person who is relying on the Statement is able to have
access to:
(i) the matter; or
(ii) if there is more than 1 version of
the matter — each version;
reasonably easily and reasonably quickly.
(4) The responsible person
for the Product Disclosure Statement must also ensure that the Statement
includes the statements in the following table relating to the matter, and sets
them out in each place at which the matter has been applied, adopted or incorporated.
|
Item
|
Statement
|
|
1
|
You should read the important information about [the
subject] before making a decision. Go to [location of the matter that
has been applied, adopted or incorporated]
|
|
2
|
The material relating to [matter] may change
between the time when you read this Statement and the day when you sign the
application form
|
(5) The responsible person
for the Product Disclosure Statement must also ensure that each document
mentioned in subregulation (3) includes the statement in the following table
relating to the matter.
|
Item
|
Statement
|
|
1
|
The information in this document forms part of the Product
Disclosure Statement [identification by name, date and version (if
applicable) of each Statement]
|
(6) For the avoidance of doubt:
(a) the giving of a Product Disclosure Statement
to which this Subdivision applies is taken to be the giving of every matter
that is applied, adopted or incorporated in accordance with subregulations (1)
to (5); and
(b) if a document mentioned in subparagraph (3) (a) (iii)
refers to more than one PDS, the document:
(i) must include a statement to the
effect that the information in the document forms part of the Product
Disclosure Statement offered by the responsible entity; but
(ii) is not required to name each
Product Disclosure Statement of which it forms part.
(7) If the Product Disclosure Statement applies, adopts
or incorporates a matter, the information dealing with the matter is taken to
have been given to a person on the day on which the person signs the application
form accompanying the Statement.
7.9.11F Retention of copies of Product Disclosure
Statement for margin loan
(1) The responsible person for a Product Disclosure
Statement for a margin loan must retain a copy of each version of the Statement
that the responsible person issues for a period of 7 years starting on the day
on which the version is prepared.
(2) The responsible person for the Product Disclosure
Statement must retain a copy of the document from which a matter is applied,
adopted or incorporated by the Statement as mentioned in paragraph 7.9.11E (3) (c)
for a period of 7 years commencing on the day on which the Statement is
prepared.
(3) If a document from which a matter is adopted,
applied or incorporated by the Product Disclosure Statement as mentioned in paragraph
7.9.11E (3) (c) is changed in a way that changes the description of,
or reference to, the matter, the responsible person for the Statement must
retain a copy of the document for a period of 7 years commencing on the day on
which the document is changed.
7.9.11G Requirement to provide copy
of Product Disclosure Statement for margin loan free of charge
(1) For paragraph 1015C (5) (a) of the Act,
this regulation specifies requirements as to the manner in which a Product
Disclosure Statement for a margin loan must be given to a person if the person
requests a copy of the Statement.
(2) The responsible person for the Product Disclosure
Statement must give the person, free of charge:
(a) a copy of the Statement within 8 business
days; and
(b) a copy of a matter in writing that is
applied, adopted or incorporated by the Statement within 8 business days.
7.9.11H Notification about change to
Approved Securities List or current interest rate for margin loan
(1) For paragraph 1017B (1A) (b) of the Act, a
change to the Approved Securities List or current interest rate for a margin
loan is specified.
(2) For paragraph 1017B (3) (c) of the Act,
the issuer of the margin loan must notify the holder of the change by:
(a) sending notice of the change to the holder:
(i) by pre-paid post to a postal
address nominated by the holder; or
(ii) to an email address nominated by
the holder; or
(b) placing a notice on a webpage that is likely
to come to the holder’s attention if the holder is monitoring the holder’s
margin loan.
Subdivision 4.2B Content of Product Disclosure Statement for
superannuation product
7.9.11K Application of Subdivision
4.2B
(1) This Subdivision applies to:
(a) a superannuation trustee that is required to
prepare a Product Disclosure Statement for a superannuation product; and
(b) a Product Disclosure Statement for a
superannuation product.
(2) However, this Subdivision does not apply to the
following financial products:
(a) a superannuation product that is solely an
interest in a defined benefits fund;
(b) a superannuation product that is solely a
pension product.
7.9.11L Provisions of Part 7.7 of
Act that do not apply in relation to superannuation product
For paragraph 951C (1) (b) of the Act,
section 942DA of the Act does not apply in relation to a superannuation
product.
7.9.11M Provisions of Part 7.9 of
Act that do not apply in relation to superannuation product
For paragraph 1020G (1) (b) of the Act,
Subdivision D of Division 2 of Part 7.9 of the Act does not apply in relation
to a superannuation product.
7.9.11N Modification of Act —
superannuation product
For paragraph 1020G (1) (c) of the Act,
Part 7.9 of the Act is modified in its application to a superannuation product
to which this Subdivision applies as set out in Part 5B of Schedule 10A.
7.9.11O Form and content of Product
Disclosure Statement for superannuation product
(1) For modified paragraph 1013C (1) (a) of
the Act, a Product Disclosure Statement for a superannuation product to which
this Subdivision applies must include the information and statements mentioned
in Schedule 10D.
(2) For modified paragraph 1013C (1) (b) of
the Act, a Product Disclosure Statement for a superannuation product to which
this Subdivision applies must be in the form mentioned in Schedule 10D.
7.9.11P Requirements for references
to incorporated information for superannuation product
(1) For subsection 1013C (1B) of the Act, as
modified by Part 5B of Schedule 10A, this regulation prescribes requirements
for applying, adopting or incorporating, in a Product Disclosure Statement for
a superannuation product to which this Subdivision applies, a matter contained
in writing.
(2) A Product Disclosure Statement may apply, adopt or
incorporate a matter only if a provision of these Regulations requires or permits
the matter to be applied, adopted or incorporated by the Statement.
(3) If a Product Disclosure Statement applies, adopts
or incorporates a matter:
(a) the matter must be:
(i) in writing; and
(ii) clearly distinguishable from any other
matters that are not to be applied, adopted or incorporated; and
(iii) if the superannuation product is not
issued to a standard employer-sponsored member within the meaning of the Superannuation
Industry (Supervision) Act 1993 — publicly available in a document
other than the Statement; and
(b) the responsible person for the Statement
must identify the matter by:
(i) including in the Statement a
concise description of the matter; and
(ii) ensuring that the reference to the
matter is clearly distinguishable from the other contents of the Statement; and
(c) the responsible person for the Statement
must:
(i) identify each version of the matter
(by including the date on which the version was prepared) so that a person who,
at a particular time, is considering a superannuation product can identify the
version that is relevant to the superannuation product at that time; and
(ii) state the date on which a version
was prepared in a prominent position at or near the front of the version; and
(d) the responsible person for the Statement
must ensure that a person who is relying on the Statement is able to have
access to:
(i) the document containing the matter;
or
(ii) if there is more than 1 version of
the document containing the matter — each version;
reasonably easily and reasonably quickly.
(4) The responsible person
for the Product Disclosure Statement must also ensure that the Statement
includes the statements in the following table relating to the matter, and sets
them out in each place at which the matter has been applied, adopted or
incorporated.
|
Item
|
Statement
|
|
1
|
You should read the important information about [the
subject] before making a decision. Go to [location of the matter that
has been applied, adopted or incorporated]
|
|
2
|
The material relating to [matter] may change
between the time when you read this Statement and the day when you sign the
application form
|
(5) The responsible person
for the Product Disclosure Statement must also ensure that each document
mentioned in subregulation (3) includes the statement in the following table
relating to the matter.
|
Item
|
Statement
|
|
1
|
The information in this document forms part of the Product
Disclosure Statement [identification by name, date and version (if
applicable) of each Statement]
|
(6) For the avoidance of doubt, the giving of a Product
Disclosure Statement to which this Subdivision applies is taken to be the
giving of every matter that is applied, adopted or incorporated in accordance
with subregulations (1) to (5).
(7) If the Product Disclosure Statement applies, adopts
or incorporates a matter, the information dealing with the matter is taken to
have been given to a person on the day on which the person signs the application
form accompanying the Statement.
7.9.11Q Retention of copies of Product Disclosure
Statement for superannuation product
(1) This regulation applies if:
(a) section 1015B of the Act does not apply to
require a Product Disclosure Statement to be lodged with ASIC; and
(b) the Statement is for a superannuation product
to which this Subdivision applies.
(2) The responsible person for the Product Disclosure Statement
must retain a copy of each version of the Statement that the responsible person
issues for a period of 7 years starting on the day on which the version is
prepared.
(3) The responsible person for the Product Disclosure Statement
must retain a copy of the document from which a matter is applied, adopted or
incorporated by the Statement as mentioned in paragraph 7.9.11P (3) (c)
for a period of 7 years commencing on the day on which the Statement is
prepared.
(4) If a document from which a matter is adopted,
applied or incorporated by the Product Disclosure Statement as mentioned in
paragraph 7.9.11P (3) (c) is changed in a way that changes the description
of, or reference to, the matter, the responsible person for the Statement must
retain a copy of the document for a period of 7 years commencing on the day on
which the document is changed.
7.9.11R Requirement to provide copy
of Product Disclosure Statement for superannuation product free of charge
(1) For paragraph 1015C (5) (a) of the Act,
this regulation specifies requirements as to the manner in which a Product
Disclosure Statement for a superannuation product to which this Subdivision applies
must be given to a person if the person requests a copy of the Statement.
(2) The responsible person for the Product Disclosure Statement
must give the person, free of charge:
(a) a copy of the Statement within 8 business
days; and
(b) a copy of a matter in writing that is
applied, adopted or incorporated by the Statement within 8 business days.
Subdivision 4.2C Content of Product Disclosure Statement for
simple managed investment scheme
7.9.11S Application of Subdivision
4.2C
(1) This Subdivision applies to:
(a) a person that is required to prepare a
Product Disclosure Statement for a simple managed investment scheme; and
(b) a Product Disclosure Statement for a simple managed
investment scheme.
(2) This Subdivision does not apply to the extent that
the simple managed investment scheme relates to a financial product (known as a
“quoted product”) which is, or is intended to be, traded on a prescribed
financial market.
(3) This Subdivision does not apply to the extent that
the simple managed investment scheme relates to a financial product (known as a
“stapled security”) to which the following requirements apply:
(a) the product consists of interests in 2 or
more financial products;
(b) the interests include at least 1 interest in
a registered managed investment scheme;
(c) under the terms on which each of the interests
is to be traded, the interests must be transferred together;
(d) there are no financial products in the same
class as the interests which may be transferred separately.
(4) This Subdivision does not apply to the extent that
the simple managed investment scheme is a managed investment scheme that has a
constitution that provides that:
(a) a member may direct that an amount of money
corresponding to part or all of the amount invested by the member in the scheme
be invested in accessible investments; and
(b) the distributions of capital and income from
the scheme to the member in relation to the member’s interests in the scheme
will be determined by reference to amounts received by the responsible entity
or a custodian in relation to the accessible investments acquired in accordance
with the direction.
7.9.11T Provisions of Part 7.7 of
Act that do not apply in relation to simple managed investment scheme
For paragraph 951C (1) (b) of the Act,
section 942DA of the Act does not apply in relation to a simple managed
investment scheme to which this Subdivision applies.
7.9.11U Provisions of Part 7.9 of
Act that do not apply in relation to simple managed investment scheme
For paragraph 1020G (1) (b) of the Act,
Subdivision D of Division 2 of Part 7.9 of the Act does not apply in relation
to a simple managed investment scheme to which this Subdivision applies.
7.9.11V Modification of Act — simple
managed investment scheme
For paragraph 1020G (1) (c) of the Act,
Part 7.9 of the Act is modified in its application to a simple managed
investment scheme to which this Subdivision applies as set out in Part 5C
of Schedule 10A.
7.9.11W Form and content of Product
Disclosure Statement for simple managed investment scheme
(1) For modified paragraph 1013C (1) (a) of
the Act, a Product Disclosure Statement for a simple managed investment scheme
to which this Subdivision applies must include the information and statements
mentioned in Schedule 10E.
(2) For modified paragraph 1013C (1) (b) of
the Act, a Product Disclosure Statement for a simple managed investment scheme
to which this Subdivision applies must be in the form mentioned in Schedule
10E.
7.9.11X Requirements for references
to incorporated information for simple managed investment scheme
(1) For subsection 1013C (1B) of the Act, as
modified by Part 5C of Schedule 10A, this regulation prescribes requirements
for applying, adopting or incorporating, in a Product Disclosure Statement for
a simple managed investment scheme to which this Subdivision applies, a matter
contained in writing.
(2) A Statement may apply, adopt or incorporate a matter
only if a provision of these Regulations requires or permits the matter to be
applied, adopted or incorporated by the Statement.
(3) If a Product Disclosure Statement applies, adopts
or incorporates a matter:
(a) the matter must be:
(i) in writing; and
(ii) clearly distinguishable from any other
matters that are not applied, adopted or incorporated; and
(iii) publicly available in a document
other than the Statement; and
(b) the responsible person for the Statement
must identify the matter by:
(i) including in the Statement a
concise description of the matter; and
(ii) ensuring that the reference to the
matter is clearly distinguishable from the other contents of the Statement; and
(c) the
responsible person for the Statement must:
(i) identify each version of the matter
(by including the date on which the version was prepared) so that a person who,
at a particular time, is considering a simple managed investment scheme to
which this Subdivision applies can identify the version that is relevant to the
simple managed investment scheme at that time; and
(ii) state the date on which the
version was prepared in a prominent position at or near the front of the
version; and
(d) the responsible person for the Statement
must ensure that a person who is relying on the Statement is able to have
access to:
(i) the matter; or
(ii) if there is more than 1 version of
the matter — each version;
reasonably easily and reasonably quickly.
(4) The responsible person
for the Product Disclosure Statement must also ensure that the Statement
includes the statements in the following table relating to the matter, and sets
them out in each place at which the matter has been applied, adopted or
incorporated.
|
Item
|
Statement
|
|
1
|
You should read the important information about [the
subject] before making a decision. Go to [location of the matter that
has been applied, adopted or incorporated]
|
|
2
|
The material relating to [matter] may change
between the time when you read this Statement and the day when you sign the
application form
|
(5) The
responsible person for the Product Disclosure Statement must also ensure that
each document mentioned in subregulation (3) includes the statement in the
following table relating to the matter.
|
Item
|
Statement
|
|
1
|
The information in this
document forms part of the Product Disclosure Statement [identification
by name, date and version (if applicable) of each Statement]
|
(6) For the avoidance of doubt:
(a) the giving of a Product Disclosure Statement
to which this Subdivision applies is taken to be the giving of every matter
that is applied, adopted or incorporated in accordance with subregulations (1)
to (5); and
(b) if a document mentioned in subparagraph (3) (a) (iii)
refers to more than one PDS, the document:
(i) must include a statement to the
effect that the information in the document forms part of the Product
Disclosure Statement offered by the responsible entity; but
(ii) is not required to name each Product
Disclosure Statement of which it forms part.
(7) If the Product Disclosure Statement applies, adopts
or incorporates a matter, the information dealing with the matter is taken to
have been given to a person on the day on which the person signs the
application form accompanying the Statement.
7.9.11Y Retention of copies of Product Disclosure
Statement for simple managed investment scheme
(1) The responsible person for a Product Disclosure
Statement for a simple managed investment scheme to which this Subdivision
applies must retain a copy of each version of the Statement that the
responsible person issues for a period of 7 years starting on the day on
which the version is prepared.
(2) The responsible person for the Product Disclosure
Statement must retain a copy of the document from which a matter is applied,
adopted or incorporated by the Statement as mentioned in paragraph 7.9.11X (3) (c)
for a period of 7 years commencing on the day on which the Statement is
prepared.
(3) If a document from which a matter is adopted,
applied or incorporated by the Product Disclosure Statement as mentioned in
paragraph 7.9.11X (3) (c) is changed in a way that changes the
description of, or reference to, the matter, the responsible person for the
Statement must retain a copy of the document for a period of 7 years commencing
on the day on which the document is changed.
7.9.11Z Requirement to provide copy
of Product Disclosure Statement for simple managed investment scheme free of
charge
(1) For paragraph 1015C (5) (a) of the Act,
this regulation specifies requirements as to the manner in which a Product
Disclosure Statement for a simple managed investment scheme to which this
Subdivision applies must be given to a person if the person requests a copy of
the Statement.
(2) The responsible person for the Product Disclosure
Statement must give the person, free of charge:
(a) a copy of the Statement within 8 business
days; and
(b) a copy of a matter in writing that is
applied, adopted or incorporated by the Statement within 8 business days.
[7] Subregulation 7.9.15DA (1)
omit
and subject to subregulation (4),
insert
and subject to subregulation (1A) and (4),
[8] After subregulation 7.9.15DA (1)
insert
(1A) This regulation does not apply if the Product
Disclosure Statement is for:
(a) a margin loan; or
(b) a superannuation product to which Subdivision
4.2B of Division 4 of Part 7.9 applies; or
(c) a simple managed investment scheme to which Subdivision
4.2C of Division 4 of Part 7.9 applies.
[9] Regulation 7.9.15DB
omit
If section 1015B
insert
(1) If section 1015B
[10] Regulation 7.9.15DB
insert
(2) This regulation does not apply if the Product
Disclosure Statement is for:
(a) a margin loan; or
(b) a superannuation product to which Subdivision
4.2B of Division 4 of Part 7.9 applies; or
(c) a simple managed investment scheme to which Subdivision
4.2C of Division 4 of Part 7.9 applies.
[11] Regulation 7.9.15DC
omit
A document,
insert
(1) A document,
[12] Regulation 7.9.15DC
insert
(2) This regulation does not apply if the Product
Disclosure Statement is for:
(a) a margin loan; or
(b) a superannuation product to which Subdivision
4.2B of Division 4 of Part 7.9 applies; or
(c) a simple managed investment scheme to which
Subdivision 4.2C of Division 4 of Part 7.9 applies.
[13] Regulation 7.9.16L
omit
For paragraph
insert
(1) For paragraph
[14] Regulation 7.9.16L
insert
(2) This regulation does not apply if the Product
Disclosure Statement is for:
(a) a margin loan; or
(b) a superannuation product to which Subdivision
4.2B of Division 4 of Part 7.9 applies; or
(c) a simple managed investment scheme to which
Subdivision 4.2C of Division 4 of Part 7.9 applies.
[15] Schedule 10A, heading
substitute
Schedule 10A Modifications of Part 7.9 of the Act
(regulations 7.9.02,
7.9.04, 7.9.05, 7.9.06, 7.9.10B, 7.9.11, 7.9.11C, 7.9.11N, 7.9.11V, 7.9.12,
7.9.24, 7.9.27, 7.9.30, 7.9.43, 7.9.47, 7.9.51, 7.9.56, 7.9.60, 7.9.61, 7.9.63,
7.9.73 and 8.4.02)
[16] Schedule 10A, after Part 5
insert
Part 5A Modifications for margin loan
5A.1 Section 1011B, after definition of regulated person
insert
Regulations means the Corporations
Regulations 2001.
5A.2 Subsection 1013C (1)
substitute
(1) A Product Disclosure Statement for a margin loan to
which Subdivision 4.2A of Division 4 of Part 7.9 of the Corporations Regulations
2001 applies must:
(a) include the statements and information
required by regulations made for this paragraph; and
(b) be in the form required by regulations made
for this paragraph.
(1A) If a law other than this Act or regulations under
this Act requires the responsible person for the Product Disclosure Statement:
(a) to give, disclose or provide a matter; or
(b) to include a matter in the Statement;
the Statement may make provision for the matter by applying,
adopting or incorporating the matter as in force at a particular time or as in
force from time to time.
(1B) In addition to subsection (1A), a Product Disclosure
Statement may make provision for a matter contained in writing by applying,
adopting or incorporating the matter as in force at a particular time or as in
force from time to time.
(1C) If a Product Disclosure Statement applies, adopts or
incorporates a matter contained in writing:
(a) the applied, adopted or incorporated matter
forms part of the Statement; and
(b) the responsible person for the Statement is
not required to give the document which provides for the matter to a person (as
part of giving the Statement or later) if that person has not asked for the
document; and
(c) the responsible person for the Statement
must give the document which provides for the matter to a person if that person
asks for the document.
(1D) The regulations may prescribe requirements for
applying, adopting, or incorporating a matter contained in writing in a Product
Disclosure Statement.
(1E) A Product Disclosure Statement may refer to
information, other than information to which subsection (1A) or (1B) applies,
that is set out in another document; and
(1F) If the Product Disclosure Statement refers to other
information as permitted by subsection (1E), that information does not form
part of the Statement.
Note Although the information mentioned
in subsection (1F) would not form part of the Product Disclosure Statement, it
would be subject to requirements imposed by the Act or these Regulations such
as the prohibition on making misleading or deceptive statements.
5A.3 Section 1013D
omit
5A.4 Section 1013E
omit
5A.5 Section 1013L
substitute
1013L When Product Disclosure
document may consist of 2 or more documents
A Product Disclosure Statement may consist of 2 or
more documents, only if:
(a) one of the documents is a document that
complies with the requirements for a Product Disclosure Statement under this
Act and the Regulations; and
(b) the other document or documents contain a
matter in writing that is applied, adopted or incorporated by the document
mentioned in paragraph (a).
5A.6 Subdivision D, Division 2
omit
5A.7 Subsection 1015D (3)
omit
Part 5B Modifications for superannuation products to which Subdivision
4.2B of Division 4 of Part 7.9 applies
5B.1 Section 1011B, after definition of regulated
person
insert
Regulations means the Corporations
Regulations 2001.
5B.2 Subsection 1013C (1)
substitute
(1) A Product Disclosure Statement for a superannuation
product to which Subdivision 4.2B of Division 4 of Part 7.9 of the Corporations
Regulations 2001 applies must:
(a) include the statements and information
required by regulations made for this paragraph; and
(b) be in the form required by regulations made
for this paragraph.
(1A) If a law other than this Act or regulations under
this Act requires the responsible person for the Product Disclosure Statement:
(a) to give, disclose or provide a matter; or
(b) to include a matter in the Statement;
the Statement may make provision for the matter by applying,
adopting or incorporating the matter as in force at a particular time or as in
force from time to time.
(1B) In addition to subsection (1A), a Product Disclosure
Statement may make provision for a matter contained in writing by applying,
adopting or incorporating the matter as in force at a particular time or as in
force from time to time.
(1C) If a Product Disclosure Statement applies, adopts or
incorporates a matter contained in writing:
(a) the applied, adopted or incorporated matter
forms part of the Statement; and
(b) the responsible person for the Statement is
not required to give the document which provides for the matter to a person (as
part of giving the Statement or later) if that person has not asked for the
document; and
(c) the responsible person for the Statement
must give the document which provides for the matter to a person if that person
asks for the document.
(1D) The regulations may prescribe requirements for
applying, adopting, or incorporating a matter contained in writing in a Product
Disclosure Statement.
(1E) A Product Disclosure Statement may refer to
information, other than information to which subsection (1A) or (1B) applies, that
is set out in another document; and
(1F) If the Product Disclosure Statement refers to other
information as permitted by subsection (1E), that information does not form
part of the Statement.
Note Although the information mentioned
in subsection (1F) would not form part of the Product Disclosure Statement, it
would be subject to requirements imposed by the Act or these Regulations such
as the prohibition on making misleading or deceptive statements.
5B.3 Section 1013D
omit
5B.4 Section 1013E
omit
5B.5 Section 1013L
substitute
1013L When Product Disclosure
Statement may consist of 2 or more documents
A Product Disclosure Statement may consist of 2 or
more documents only if:
(a) one of the documents is a document that
complies with the requirements for a Product Disclosure Statement under this
Act and the Regulations; and
(b) the other document or documents contain a
matter in writing that is applied, adopted or incorporated by the document
mentioned in subparagraph (a).
5B.6 Subsection 1015D (3)
omit
Part 5C Modifications for simple managed investment scheme
5C.1 Section 1011B, after definition of regulated
person
insert
Regulations means the Corporations
Regulations 2001.
5C.2 Subsection 1013C (1)
substitute
(1) A Product Disclosure Statement for a simple managed
investment scheme to which Subdivision 4.2C of Division 4 of Part 7.9 of the Corporations
Regulations 2001 applies must:
(a) include the statements and information
required by regulations made for this paragraph; and
(b) be in the form required by regulations made
for this paragraph; and
(c) relate only to 1 simple managed investment
scheme.
(1A) If a law other than this Act or regulations under
this Act requires the responsible person for the Product Disclosure Statement:
(a) to give, disclose or provide a matter; or
(b) to include a matter in the Statement;
the Statement may make provision for the matter by applying,
adopting or incorporating the matter as in force at a particular time or as in
force from time to time.
(1B) In addition to subsection (1A), a Product Disclosure
Statement may make provision for a matter contained in writing by applying,
adopting or incorporating the matter as in force at a particular time or as in
force from time to time.
(1C) If a Product Disclosure Statement applies, adopts or
incorporates a matter contained in writing:
(a) the applied, adopted or incorporated matter
forms part of the Statement; and
(b) the responsible person for the Statement is
not required to give the document which provides for the matter to a person (as
part of giving the Statement or later) if that person has not asked for the
document; and
(c) the responsible person for the Statement
must give the document which provides for the matter to a person if that person
asks for the document.
(1D) The regulations may prescribe
requirements for applying, adopting, or incorporating a matter contained in
writing in a Product Disclosure Statement.
(1E) A Product Disclosure
Statement may refer to information, other than information to which subsection
(1A) or (1B) applies, that is set out in another document; and
(1F) If the Product Disclosure
Statement refers to other information as permitted by subsection (1E), that
information does not form part of the Statement.
Note Although
the information mentioned in subsection (1F) would not form part of the Product
Disclosure Statement, it would be subject to requirements imposed by the Act or
these Regulations such as the prohibition on making misleading or deceptive
statements.
5C.2 Section 1013D
omit
5C.3 Section 1013E
omit
5C.4 Section 1013L
substitute
1013L When
Product Disclosure Statement may consist of 2 or more documents
A Product Disclosure
Statement may consist of 2 or more documents only if:
(a) one of the documents is a document that
complies with the requirements for a Product Disclosure Statement under this
Act and the Regulations; and
(b) the other document or documents contain a
matter in writing that is applied, adopted or incorporated by the document
mentioned in subparagraph (a).
5C.5 Subsection 1015D (3)
omit
[17] After Schedule 10BA
insert
Schedule 10C Form and content of Product Disclosure Statement —
margin loan
(regulation 7.9.11D)
1 Length and font size for Product
Disclosure Statement for margin loan
(1) The length of a Product Disclosure Statement for a
margin loan (not including any title page, table of contents or matter in
writing that is applied, adopted or incorporated by the Statement) must not
exceed:
(a) if it is printed on A4 pages — 4 pages;
or
(b) if it is printed on A5 pages — 8 pages;
or
(c) if it is printed on DL pages — 12
pages; or
(d) otherwise — if it is formatted to be
printed on A4 pages, 4 A4 pages.
(2) The minimum font size for text in the Statement is:
(a) for the name, address, ABN (if applicable),
ACN (if applicable) and AFSL (if applicable) of the person giving the Statement —
8 points; and
(b) for all other text — 9 points.
Note 1 The Product Disclosure
Statement must be worded and presented in a clear, concise and effective manner —
see subsection 1013C (3) of the Act.
Note 2 A person required to a give a
Product Disclosure Statement to a vision-impaired person must comply with its
obligations under the Disability Discrimination Act 1992.
2 Minimum content of Product Disclosure
Statement for margin loan
(1) The Product Disclosure Statement must include the
following sections, which must be numbered and titled as follows:
1. About [name of provider of the
margin loan] and [name of margin loan product]
2. Benefits of [name
of margin loan product]
3. How [name of
margin loan product] works
4. What is a margin
call?
5. The risk of
losing money
6. The costs
7. How to apply.
(2) The Product Disclosure Statement must include:
(a) a table of contents that sets out the titles
mentioned in subclause (1); and
(b) the telephone number of the provider of the
margin loan to enable a borrower for the margin loan to request a copy of the
following under regulation 7.9.11G:
(i) a copy of the Statement; and
(ii) a copy of a matter in writing that
is applied, adopted or incorporated by the Statement.
(3) The Product Disclosure Statement must:
(a) advise a person reading the Statement that:
(i) it is a summary of significant
information and contains a number of references to important information (each
of which forms part of the Statement); and
(ii) the person should consider that
information before making a decision about the product; and
(iii) the information provided in the
Statement is general information only and does not take account of the person’s
personal financial situation or needs; and
(iv) the person should obtain financial
advice tailored to the person’s personal circumstances; and
(b) display the advice:
(i) at or near the beginning of the
document; and
(ii) in a prominent position and style.
(4) The Product Disclosure Statement:
(a) may include additional sections after
sections 1 to 7; and
(b) may include other information;
to an extent that does not have the effect of contravening
subclause 1 (1).
(5) The Product Disclosure Statement does not need to
indicate that a particular requirement is not applicable to the margin loan.
Note The Act, as modified in accordance
with Subdivision 4.2A of Division 4 of Part 7.9, requires information to be
included in the Product Disclosure Statement only to the extent to which the
requirement is applicable to the margin loan.
3 Contents of section 1 (About [name of
provider of the margin loan] and [name of margin loan product])
Section 1 of the Product Disclosure Statement must
include:
(a) a short description of the margin loan
provider and its business; and
(b) a short summary of what margin lending is;
and
(c) a statement setting out the possible
consequences of borrowing money to invest, including the effect of magnifying
both gains and losses; and
(d) a statement that the borrower for a margin
loan should regularly monitor the borrower’s portfolio so that:
(i) the borrower can be aware of
changes (if any) to the terms of the margin loan; and
(ii) the borrower can take timely
action to prevent potential losses in relation to the borrower’s portfolio; and
(e) a statement that the borrower for a margin
loan may need, at short notice, to pay an additional amount into the margin
loan or sell some of the investments for which the margin loan is made; and
(f) a statement that the provider of a margin
loan has the right in certain circumstances to sell all, or part, of the
borrower’s portfolio and may not be required under the terms of the margin loan
to provide notice to the borrower of its intention to sell; and
(g) a statement that if the value of the
portfolio for a margin loan does not cover the cost of repayments for the
margin loan:
(i) the borrower for the margin loan
may need to access other funds to repay the margin loan; or
(ii) the provider of the margin loan
may sell assets provided as security for the margin loan, for example, the
borrower’s residential property; and
(h) a statement that the law requires the
provider of a margin loan to:
(i) assess whether the margin loan is
unsuitable for the potential borrower for the margin loan; and
(ii) if the potential borrower for the
margin loan requests a copy of the assessment — to provide a copy of the
assessment to the potential borrower for the margin loan.
Note The provider of a margin loan is not
required to give the borrower or potential borrower for the margin loan a copy
of the assessment if the margin loan is not issued.
4 Contents of section 2 (Benefits of
[name of margin loan product])
(1) Section 2 of the Product Disclosure Statement for a
margin loan must include a description of the key benefits available to the
borrower or potential borrower for the margin loan.
(2) Section 2 of the Statement may include a description
about other benefits available to a borrower or potential borrower for the
margin loan other than the benefits mentioned in subclause (1).
(3) Section 2 of the Statement may provide for the
description mentioned in subclause (2) by applying, adopting or incorporating a
matter in writing.
5 Contents of section 3 (How [name of
margin loan product] works)
(1) Section 3 of the Product Disclosure Statement for a
margin loan must include:
(a) an explanation of how margin lending works
including information about the following:
(i) the maximum loan amount for the
margin loan;
(ii) the loan-to-value ratios for the
margin loan; and
(b) at least 1 example that illustrates the
matters mentioned in subparagraphs (a) (i) and (ii); and
(c) a description of the financial products that
the borrower or potential borrower for the margin loan can purchase with the
margin loan (including the Approved Securities List for the provider or
potential provider of the margin loan); and
(d) an explanation of who owns the investments
purchased with the margin loan; and
(e) a statement that:
(i) details of the rights and
obligations of the borrower for a margin loan are set out in the terms of the agreement
for the margin loan; and
(ii) recommends that a potential
borrower for a margin loan read the loan agreement; and
(iii) explains how a potential borrower
can obtain a copy of the loan agreement; and
(f) an explanation of any other features of the
margin loan that:
(i) are not covered by the matters
mentioned in paragraphs (a), (c) and (d); and
(ii) are sufficiently important to be
material to a reasonable person’s decision to take out the margin loan; and
(g) a reference to:
(i) the calculator provided on a
website operated by or on behalf of the Commonwealth and an explanation of the
assistance the calculator can provide; or
(ii) if the provider or potential provider
of the margin loan provides a calculator to borrowers or potential borrowers
for the margin loan — that calculator and an explanation of the assistance
the calculator can provide.
(2) Section 3 of the Statement may provide for the
following matters by applying, adopting or incorporating the matter in writing:
(a) the Approved Securities List;
(b) the explanation mentioned in paragraph (1) (f).
6 Contents of section 4 (What is a margin
call?)
Section 4 of the Product Disclosure Statement for
a margin loan must include:
(a) if the terms of the margin loan include a
margin call:
(i) an explanation of what a margin
call is; and
(ii) an explanation of when there will
be a margin call in response to changes in the market; and
(iii) an explanation of when there will
be a margin call at the discretion of the provider of the margin loan; and
(iv) at least 1 example of how a margin
call works, including:
(A) the impact of breaching
the loan-to-value ratio (LVR) for the margin loan; and
(B) how to adjust the LVR
back to the required level for the margin loan; and
(C) how the buffer (if any)
for the margin loan operates; and
(v) a description of how a margin call
can be dealt with by the borrower for the margin loan; and
(vi) a statement that if there is a
margin call, the provider of the margin loan will notify the borrower for the
margin loan, or the borrower’s financial advisor, that the margin call has
occurred; and
(vii) a statement that the borrower for
the margin loan must be contactable at all times in case of a margin call; and
(b) if the terms of the margin loan do not
include a margin call, a statement to that effect.
7 Contents of section 5 (The risk of
losing money)
(1) Section 5 of the Product Disclosure Statement for a
margin loan must include a description of the risks associated with margin
lending to a borrower for the margin loan, including a description of any of
the following risks, if relevant:
(a) the risk that the value of the borrower’s
investment may fall and the possible consequences to the borrower if this
occurs, in particular the risk of a margin call occurring;
(b) the risk that the provider of the margin loan
may change the loan-to-value ratio of an investment at any time and the
consequences to the borrower of the change, in particular, the risk of a margin
call occurring;
(c) the risk that the provider of the margin
loan may remove an investment from the Approved Securities List and the
consequences for the borrower if this occurs, in particular, the risk of a margin
call occurring;
(d) the risk that the interest rate for the
margin loan may rise and the consequences for the borrower if this occurs, in
particular, the possibility that interest payments owed by the borrower may
exceed the returns available from the borrower’s portfolio;
(e) the risk of the loss of property of the
borrower if the property has been mortgaged as security for, or in connection
with, the margin loan;
(f) the risk of a default event under the loan
agreement occurring and the potential consequences for the borrower if a
default event does occur;
(g) the risk that the taxation laws may change
and that this may have a negative effect on the tax position for the borrower
for the margin loan;
(h) any other significant risks that a reasonable
person would consider to be relevantly associated with the margin loan.
(2) Section 5 of the Statement
must include a hyperlink to the page on a website operated by or on behalf of
the Commonwealth that provides information about margin loans.
(3) Section 5 of the Statement
may include information about risks associated with margin lending other than
the risks mentioned in subclause (1).
(4) Section 5 of the Statement
may provide for the information mentioned in subclause (3) by applying,
adopting or incorporating a matter in writing.
8 Contents of section 6 (The costs)
(1) Section 6 of the Product Disclosure Statement for a
margin loan must include the following:
(a) a description of the interest rate for the
margin loan, including how the interest rate is calculated;
(b) a statement about whether a default interest
rate will be charged for the margin loan;
(c) details of any fee or cost to be charged by
the provider of the margin loan, unless the fee is a minor fee;
(d) a statement about whether a fee or cost to be
charged by the provider for the loan can be unilaterally changed by the
provider under the loan agreement;
(e) a list of matters for which the provider of
the margin loan will charge a minor fee for the margin loan;
(f) a statement about whether a commission or
fee is payable to a financial advisor or other third party for the margin loan
and, if a commission or fee is payable:
(i) the circumstances in which the
commission or fee will be payable; and
(ii) how the borrower for the margin
loan can obtain more detailed information about the commission or fee.
(2) Section 6 of the Statement must include:
(a) a statement of the interest rate for the
margin loan; and
(b) details of any minor fee the provider of the
margin loan will charge for the margin loan.
(3) Section 6 of the Statement
may provide for the statement mentioned in paragraph (2) (a) or the
details mentioned in paragraph (2) (b) by applying, adopting or
incorporating a matter in writing
9 Contents of section 7 (How to apply)
(1) Section 7 of the Product Disclosure Statement for a
margin loan must include:
(a) information about how to apply for the
margin loan; and
(b) a short summary about the dispute resolution
system the provider of the margin loan has for dealing with disputes or
complaints about the loan, including:
(i) how a borrower for the loan may
make a complaint about the loan; and
(ii) contact details for making a
complaint about the loan.
(2) The
margin loan provider:
(a) may provide more detailed information about
cooling-off periods, complaints and dispute resolution; and
(b) may provide that information by applying,
adopting or incorporating a matter in writing.
Schedule 10D Form and content of Product Disclosure Statement —
superannuation product to which Subdivision 4.2B of Division 4 of Part 7.9
applies
(regulation 7.9.11O)
1 Length and font size for Product
Disclosure Statement for superannuation product
(1) The length of a Product Disclosure Statement for a
superannuation product to which Subdivision 4.2B of Division 4 of Part 7.9
applies (not including any matter in writing that is applied, adopted or
incorporated by the Statement) must not exceed:
(a) if it is printed on A4 pages — 8 pages;
or
(b) if it is printed on A5 pages — 16 pages;
or
(c) if it is printed on DL pages — 24
pages; or
(d) otherwise — if it is formatted to be
printed on A4 pages, 8 A4 pages.
(2) The minimum font size for text in the Statement is:
(a) for the name, address, ABN (if applicable),
ACN (if applicable) and AFSL (if applicable) of the person giving the Statement —
8 points; and
(b) for all other text — 9 points.
Note 1 The Product Disclosure
Statement must be worded and presented in a clear, concise and effective manner —
see subsection 1013C (3) of the Act.
Note 2 A person required to a give a
Product Disclosure Statement to a vision-impaired person must comply with its
obligations under the Disability Discrimination Act 1992.
2 Minimum content of Product Disclosure
Statement for superannuation product
(1) Subject to subclause 10 (1), the Product
Disclosure Statement must include sections which must be numbered and titled as
follows:
1. About [name of
superannuation product]
2. How super works
3. Benefits of investing with [name
of superannuation product]
4. Risks of
super
5. How we invest
your money
6. Fees and costs
7. How super is
taxed
8. Insurance in your
super
9. How to open an
account.
(2) However, if the superannuation product does not
offer insurance cover:
(a) section 9 may be presented as section 8; and
(b) if section 9 is presented as section 8 —
a reference in clause 11 to section 9 is taken to be a reference to section 8.
(3) The Product Disclosure Statement must include:
(a) a table of contents that sets out the titles
mentioned in subclause (1); and
(b) the telephone number of the superannuation
trustee to enable a person who acquires the superannuation product to request a
copy of the following under regulation 7.9.11R:
(i) a copy of the Statement; and
(ii) a copy of a matter in writing that
is applied, adopted or incorporated by the Statement.
(4) The Product Disclosure Statement must:
(a) advise a person reading the Statement that:
(i) it is a summary of significant
information and contains a number of references to important information (each
of which forms part of the Statement); and
(ii) the person should consider that
information before making a decision about the product; and
(iii) the information provided in the
Statement is general information only and does not take account of the person’s
personal financial situation or needs; and
(iv) the person should obtain financial
advice tailored to the person’s personal circumstances; and
(b) display the advice:
(i) at or near the beginning of the
document; and
(ii) in a prominent position and style.
(5) The Product Disclosure Statement:
(a) may include additional sections after
sections 1 to 9; and
(b) may include other information;
to an extent that does not have the effect of contravening
subclause 1 (1).
(6) The Product Disclosure Statement does not need to
indicate that a particular requirement is not applicable to the superannuation
product.
Note The Act, as modified in accordance
with Subdivision 4.2B of Division 4 of Part 7.9, requires information to be
included in the Product Disclosure Statement only to the extent to which the
requirement is applicable to the superannuation product.
3 Contents of section 1 (About [name of
superannuation product])
Section 1 of the Product Disclosure Statement must
describe, in the form of a summary, the superannuation fund and its products.
4 Contents of section 2 (How super works)
(1) Section 2 of the Product Disclosure Statement must include
statements to the effect that:
(a) superannuation is a means of saving for
retirement which is, in part, compulsory; and
(b) there are different types of contributions
available to a person (for example, employer contributions, voluntary
contributions, government co-contributions); and
(c) there are limitations on contributions to,
and withdrawals from, superannuation; and
(d) tax savings are provided by the Government;
and
(e) most people have the right to choose into
which fund the employer should direct their superannuation guarantee
contributions.
(2) The superannuation trustee may provide more
detailed information on the matters set out in subclause (1) by:
(a) applying, adopting or incorporating a matter
in writing; or
(b) providing a reference to a website, operated
by or on behalf of the Commonwealth, that contains the information.
5 Contents of section 3 (Benefits of investing
with [name of superannuation product])
(1) Section 3 of the Product Disclosure Statement must
describe the superannuation product covered by the Statement, including a
summary of its significant features and the benefits it provides.
(2) The superannuation trustee may provide additional
information about significant benefits of superannuation or other significant
features of the superannuation product by applying, adopting or incorporating a
matter in writing.
6 Contents of section 4 (Risks of super)
(1) Section 4 of the Product Disclosure Statement must
include statements to the following effect:
(a) all investments carry risk;
(b) different strategies may carry different
levels of risk, depending on the assets that make up the strategy;
(c) assets with the highest long-term returns
may also carry the highest level of short-term risk.
(2) Section 4 must describe, in the form of a summary,
the significant risks of the particular superannuation product.
(3) Section 4 must describe the significant risks of
superannuation (to the extent only that the description required by subitem (2)
has not already described the risk) by including statements to the following
effect:
(a) the value of investments will vary;
(b) the level of returns will vary, and future
returns may differ from past returns;
(c) returns are not guaranteed, and persons may
lose some of their money;
(d) superannuation laws may change in the future;
(e) the amount of a person’s future superannuation
savings (including contributions and returns) may not be enough to provide
adequately for the person’s retirement;
(f) the level of risk for each person will vary
depending on a range of factors, including:
(i) age; and
(ii) investment time frames; and
(iii) where other parts of the person’s
wealth are invested; and
(iv) the person’s risk tolerance.
(4) The superannuation trustee may provide additional
information about significant risks of superannuation by applying, adopting or
incorporating a matter in writing.
7 Contents of section 5 (How we invest
your money)
(1) Section 5 of the Product Disclosure Statement must
describe, in the form of a summary:
(a) the investment options being offered; and
(b) what happens if the person does not make a
choice of where to invest.
(2) Section 5 must state, in the form of a warning,
that the person must consider:
(a) the likely investment return; and
(b) the risk; and
(c) the person’s investment timeframe;
when choosing an option in which to invest.
(3) For at least 1 investment option, section 5 must:
(a) state the name of the option and give a
short description of it, including the type of investors for whom it is
intended to be suitable; and
(b) list the asset classes in which the option invests,
and set out, in the form of a range or otherwise, the strategic asset
allocation of the asset classes; and
(c) describe the investment return objective of
the option; and
(d) state the minimum suggested time frame for
holding the investment; and
(e) describe, in the form of a summary, the risk
level of the option.
(4) If the superannuation product has a default option,
section 5 must give the information mentioned in subclause (3) for the default
option, whether or not section 5 gives that information for any other
investment option.
(5) If the superannuation product offers more than 1
default investment option, section 5 must give the information mentioned in
subclause (3) for the default investment option under which the superannuation
trustee has the most funds invested, whether or not section 5 gives that
information for any other investment option
(6) If the superannuation product does not have a
default option, and has a balanced investment option (within the meaning given
by item 101 of Schedule 10), section 5 must give the information mentioned in
subclause (3) for the balanced investment option, whether or not section 5
gives that information for any other investment option.
(7) If the superannuation product does not have a
default option, and does not have a balanced investment option, section 5 must
give the information mentioned in subclause (3) for the investment option under
which the superannuation trustee has the most funds invested, whether or not
section 5 gives that information for any other investment option.
(8) Section 5:
(a) must make provision for each investment
option which is not presented in section 5 in accordance with subclause (3),
(4), (5), (6) or (7); and
(b) may make provision for the option by
applying, adopting or incorporating matter in a document that:
(i) includes the information mentioned
in subclause (3); and
(ii) presents it in the way mentioned
in the subclause.
(9) The superannuation trustee:
(a) must provide information about how a person
may switch the person’s investments; and
(b) must provide information about:
(i) whether the superannuation product’s
investment options may be changed; and
(ii) and, if so, how the options may be
changed; and
(c) must describe, in the form of a summary, the
extent to which labour standards or environmental, social or ethical
considerations are taken into account in the selection, retention or
realisation of investments relating to the superannuation product; and
(d) may provide the information in paragraphs (a)
to (c), and any additional information about investment options, by applying,
adopting or incorporating a matter in writing.
8 Contents of section 6 (Fees and costs)
(1) For each investment option of the superannuation
product that is presented in section 5 in detail in accordance with subclause 7 (3),
section 6 of the Product Disclosure Statement must state:
(a) the cost of acquiring the option; and
(b) the fees and costs that are charged in
relation to the option.
Note The statement will be made using the
template set out in subclause (3).
(2) Before setting out any other substantive material,
section 6 must:
(a) set out the Consumer Advisory Warning in
clause 221 of Schedule 10; and
(b) give a concise example in the form set out in
the Consumer Advisory Warning in clause 221 of Schedule 10.
(3) Section
6 must set out the fees and costs for each investment option that is presented
in section 5 in detail in accordance with subclause 7 (3), using the
following template.
|
TYPE OF FEE OR COST
|
AMOUNT
|
|
Fees when your money moves in or out of the fund
|
|
|
Establishment fee
|
|
|
Contribution fee
|
|
|
Withdrawal fee
|
|
|
Termination fee
|
|
|
Management costs
|
|
|
The fees and costs for
managing your investment
|
|
[If there are other service fees, such
as advisor service fees or special request fees, include a cross reference to
the document that contains the information mentioned in paragraph (10) (a).].
(4) The template is to be completed in accordance with Division 3
of Schedule 10 (including definitions applicable to that Division), except
that:
(a) clauses 203, 205, 206 and 207 and subclause
208 (2) do not apply; and
(b) the reference in clause 204 to clause 205 and
clause 206 does not apply; and
(c) the example in subclause 208 (1) is to
be treated as stating:
“(for example, by using an asterisk with a
footnote stating ‘The amount of this fee can be negotiated’)”.
(5) Section 6 must set out the information about fee
changes set out in paragraph 209 (k) of Schedule 10.
(6) Section 6 must:
(a) state that the information in the template
can be used to compare costs between different superannuation products; and
(b) state concisely, and in general terms, that
fees and costs can be paid directly from the person’s account or deducted from
investment returns.
(7) Section 6 must give a worked example as follows:
(a) if the superannuation product offers more
than 1 default investment option, section 6 must give a worked example for the
default investment option under which the superannuation trustee has the most
funds invested;
(b) if the superannuation product does not have a
default option, and has a balanced investment option (within the meaning given
by item 101 of Schedule 10), section 6 must give a worked example for the
balanced investment option;
(c) if the superannuation product does not have
a default option, and does not have a balanced investment option, section 6
must give a worked example for the investment option under which the
superannuation trustee has the most funds invested;
in accordance with Divisions 5 and 6 of Schedule 10 (including
definitions applicable to those Divisions), except that clauses 212 and 220 do
not apply.
(8) Section 6:
(a) must refer to the calculator provided by
ASIC on its FIDO website or a similar website operated by or on behalf of ASIC;
and
(b) may also refer to the calculator (if any)
provided by the superannuation trustee on its website; and
(c) must state that each calculator referred to
can be used to calculate the effect of fees and costs on account balances.
(9) If additional fees may be payable to a financial
advisor, section 6 must:
(a) state, in the form of a warning, that
additional fees may be paid to a financial advisor if a financial advisor is
consulted; and
(b) refer to the Statement of Advice in which
details of the fees are set out; and
(c) if applicable:
(i) state that fees may be paid to the
employer entity’s financial adviser; and
(ii) explain how the fees are
determined.
(10) The superannuation trustee:
(a) must provide the fees and costs of each of
the investment options in accordance with Schedule 10, and may do so by
applying, adopting or incorporating a matter in writing; and
(b) may provide more detailed information about
fees and costs by applying, adopting or incorporating a matter in writing.
9 Contents of section 7 (How super is
taxed)
(1) Section 7 of the Product Disclosure Statement must
describe, in the form of a summary, the significant tax information relating to
superannuation products, including:
(a) how tax amounts due are paid; and
(b) the main taxes that are payable in relation
to contributions (if contributions are permitted), fund earnings and
withdrawals.
(2) Section 7 must:
(a) state, in the form of a warning, that the
person should provide the person’s tax file number as part of acquiring the
superannuation product; and
(b) explain, in the form of a summary, the
consequences if the person does not provide the person’s tax file number; and
(c) if contributions are permitted — set
out a warning that there will be taxation consequences if the contribution caps
applicable to superannuation are exceeded.
(3) The superannuation trustee may provide additional
information about taxation matters relating to superannuation products by
applying, adopting or incorporating a matter in writing.
10 Contents of section 8 (Insurance in your
super)
(1) If the superannuation product does not offer
insurance cover, the Product Disclosure Statement is not required to include
any of the information in this clause.
(2) If the superannuation product offers insurance
cover, section 8 must:
(a) describe, in the form of a summary, the main
types of insurance cover that a person can acquire; and
(b) describe, in the form of a summary, how to
apply for insurance cover; and
(c) include a statement to the effect that there
are costs associated with insurance cover; and
(d) describe, in the form of a summary, who is
responsible for paying the insurance costs and how they are calculated.
(3) If the superannuation product offers insurance
cover by default, section 8 must:
(a) describe, in the form of a summary, the
level and type of cover; and
(b) state:
(i) the actual cost of the cover in
dollars, or the range of costs that would be payable depending on a person’s
circumstances; and
(ii) who is responsible for paying the
costs; and
(c) state whether a person can:
(i) decline to acquire the cover; or
(ii) cancel the cover; and
(d) state how a person can decline to acquire the
cover or cancel the cover; and
(e) state whether a person can change the
person’s insurance cover; and
(f) state how a person can change the person’s
insurance cover; and
(g) state, in the form of a warning, that,
unless a person declines to acquire the default insurance cover or cancels it,
the cost of the cover will be deducted from the person’s account or from the
person’s contributions (as applicable); and
(h) include information about eligibility for,
and the cancellation of, the insurance cover; and
(i) include information about any conditions
and exclusions that are applicable to the insurance cover.
(4) If the superannuation product does not offer
insurance cover by default but offers insurance cover as an option, section 8
must include the following information:
(a) the level and type of insurance cover available;
(b) the actual cost of the cover in dollars, or
the range of costs that would be payable depending on a person’s circumstances;
(c) eligibility for, and the cancellation of,
the insurance cover;
(d) any conditions and exclusions that are applicable
to the insurance cover;
(e) any other significant matter in relation to
insurance cover.
Examples for paragraph (e)
1 Information about how a person can
apply for the insurance cover.
2 Information about how a person can
subsequently change or cancel the insurance cover.
(5) The superannuation trustee:
(a) may provide the information in paragraphs
(3) (h) and (i) and subclause (4); and
(b) may provide additional information about
insurance cover;
by applying, adopting or incorporating a matter in writing.
(6) If information about:
(a) eligibility for, or the cancellation of, the
insurance cover; or
(b) any conditions and exclusions that are
applicable to the insurance cover;
is provided for in accordance with subclause (5), section 8 must
include a warning to the effect that the matter may affect a person’s
entitlement to insurance cover and that the information should be read before
deciding whether the insurance is appropriate.
(7) If information about:
(a) the level and type of optional insurance
cover available; or
(b) the actual cost of the optional insurance cover
in dollars, or the range of costs that would be payable depending on a person’s
circumstances; or
(c) any other significant matter in relation to insurance
cover;
is provided for in accordance with subclause (5), section 8 must
include a warning to the effect that the information should be read before
deciding whether the insurance is appropriate.
11 Contents of section 9 (How to open an
account)
(1) Section 9 of the Product Disclosure Statement must,
if applicable:
(a) describe, in the form of a summary, how to
open an account with the superannuation provider; and
(b) explain the cooling-off period that applies
to the superannuation product; and
(c) explain how to make a complaint (by means
that include the provision of relevant contact details).
Note The effect of subclause 10 (1)
is that the Product Disclosure Statement is not required to include section 8
(as set out in clause 10) if the superannuation product does not offer
insurance cover. In that case, subclause 2 (2) allows the Statement to
present the information in this clause as “section 8” or “section 9”.
(2) The superannuation trustee:
(a) may provide more detailed information about
cooling-off periods, complaints and dispute resolution; and
(b) may provide that information by applying,
adopting or incorporating a matter in writing.
Schedule 10E Form and content of Product Disclosure Statement — simple
managed investment scheme
(regulation 7.9.11W)
1 Length and font size for Product
Disclosure Statement for simple managed investment scheme
(1) The length of a Product Disclosure Statement for a simple
managed investment scheme to which Subdivision 4.2C of Division 4 of Part 7.9
applies (not including any matter in writing that is applied, adopted or
incorporated by the Statement) must not exceed:
(a) if it is printed on A4 pages — 8 pages;
or
(b) if it is printed on A5 pages — 16 pages;
or
(c) if it is printed on DL pages — 24
pages; or
(d) otherwise — if it is formatted to be printed
on A4 pages, 8 A4 pages.
(2) The minimum font size for text in the Statement is:
(a) for the name, address, ABN (if applicable),
ACN (if applicable), ARSN and AFSL (if applicable) of the person giving the
Statement — 8 points; and
(b) for all other text — 9 points.
Note 1 The Product Disclosure
Statement must be worded and presented in a clear, concise and effective manner —
see subsection 1013C (3) of the Act.
Note 2 A person required to a give a
Product Disclosure Statement to a vision-impaired person must comply with its
obligations under the Disability Discrimination Act 1992.
2 Minimum content of Product Disclosure
Statement for simple managed investment scheme
(1) The Product Disclosure Statement must include sections
which must be numbered and titled as follows:
1. About [name of responsible
entity]
2. How [name of simple managed
investment scheme] works
3. Benefits of investing in [name
of simple managed investment scheme]
4. Risks of managed
investment schemes
5. How we invest your money
6. Fees and costs
7. How managed investment schemes
are taxed
8. How to apply.
(2) The Statement must include:
(a) a table of contents that sets out the titles
mentioned in subclause (1); and
(b) the telephone number of the responsible
entity for the simple managed investment scheme to enable a person who invests
in the simple managed investment scheme to request a copy of the following
under regulation 7.9.11Z:
(i) a copy of the Statement; and
(ii) a copy of a matter in writing that
is applied, adopted or incorporated by the Statement.
(3) The Statement must:
(a) advise a person reading the Statement that:
(i) it is a summary of significant
information and contains a number of references to important information (each
of which forms part of the Statement); and
(ii) persons should consider that
information before making a decision about the simple managed investment
scheme; and
(iii) the information provided in the
Statement is general information only and does not take account of the person’s
personal financial situation or needs; and
(iv) the person should obtain financial
advice tailored to the person’s personal circumstances; and
(b) display the advice:
(i) at or near the beginning of the
document; and
(ii) in a prominent position and style.
(4) The Statement:
(a) may include additional sections after
sections 1 to 8; and
(b) may include other information;
to an extent that does not have the effect of contravening
subclause 1 (1).
(5) The Product Disclosure Statement does not need to
indicate that a particular requirement is not applicable to the simple managed
investment scheme.
Note The Act, as modified in accordance
with Subdivision 4.2C of Division 4 of Part 7.9, requires information to be
included in the Product Disclosure Statement only to the extent to which the
requirement is applicable to the simple managed investment scheme.
3 Contents of section 1 (About [name of
responsible entity])
(1) Section 1 of the Product Disclosure Statement must
describe, in the form of a summary:
(a) the responsible entity and its role in
operating the simple managed investment scheme; and
(b) the investment manager, if the investment
manager is different from the responsible entity.
(2) If there is more than 1 investment manager, the
Statement may describe a particular manager by applying, adopting or
incorporating a matter in writing.
4 Contents of section 2 (How [name of simple
managed investment scheme] works)
(1) Section 2 of the Product Disclosure Statement must
describe, in the form of a summary:
(a) how the simple managed investment works; and
(b) the interests that members acquire.
(2) Section 2 must:
(a) if applicable — describe, in the form
of a summary, the minimum investment amounts; and
(b) provide information about the structure of
the simple managed investment scheme; and
(c) state, in general terms, that the price of
interests will vary as the market value of assets in the simple managed
investment scheme rises or falls; and
(d) describe, in the form of a summary, how
members can increase or decrease their investment by acquiring interests or
disposing of interests; and
(e) state, in general terms, that in some
circumstances, such as when there is a freeze on withdrawals, members may not
be able to withdraw their funds within the usual period upon request; and
(f) describe the frequency of distributions and
explain how distributions are calculated.
(3) The responsible entity:
(a) may provide more detailed information on the
acquisition and disposal of interests; and
(b) may provide the information by applying,
adopting or incorporating a matter in writing.
5 Contents of section 3 (Benefits of
investing in [name of simple managed investment scheme])
(1) Section 3 of the Product Disclosure Statement must,
before setting out any other information, describe, in the form of a summary:
(a) the significant features of the simple
managed investment scheme; and
(b) the significant benefits of the simple
managed investment scheme.
(2) The responsible entity may provide additional
information about:
(a) other features and benefits of the simple
managed investment scheme; or
(b) other features and benefits of simple managed
investment schemes;
by applying, adopting or incorporating a matter in writing.
6 Contents of section 4 (Risks of managed
investment schemes)
(1) Section 4 of the Product Disclosure Statement must
include statements to the following effect:
(a) all investments carry risk;
(b) different strategies may carry different
levels of risk, depending on the assets that make up the strategy;
(c) assets with the highest long-term returns
may also carry the highest level of short-term risk.
(2) Section 4 must describe, in the form of a summary,
the significant risks of the particular simple managed investment scheme.
(3) Section 4 must describe the significant risks of managed
investment schemes (to the extent only that the description required by subitem (2)
has not already described the risk) by including statements to the following
effect:
(a) the value of investments will vary;
(b) the level of returns will vary, and future
returns may differ from past returns;
(c) returns are not guaranteed, and members may
lose some of their money;
(d) laws affecting registered managed investment
schemes may change in the future;
(e) the level of risk for each person will vary
depending on a range of factors, including:
(i) age; and
(ii) investment time frames; and
(iii) where other parts of the member’s
wealth are invested; and
(iv) the member’s risk tolerance.
(4) The responsible entity may provide additional
information about significant risks of managed investment schemes by applying,
adopting or incorporating a matter in writing.
7 Contents of section 5 (How we invest
your money)
(1) Section 5 of the Product Disclosure Statement must
describe, in the form of a summary, the investment options offered by the simple
managed investment scheme.
(2) Section 5 must state, in the form of a warning,
that the person should consider:
(a) the likely investment return; and
(b) the risk; and
(c) the person’s investment timeframe;
when choosing an option in which to invest.
(3) For at least 1 investment option, section 5 must:
(a) state the name of the option and give a
short description of it, including the type of investors for whom it is
intended to be suitable; and
(b) list the asset classes in which the option
invests, and set out, in the form of a range or otherwise, the strategic asset
allocation of the asset classes; and
(c) describe the investment return objective of
the option; and
(d) state the minimum suggested time frame for
holding the investment; and
(e) describe, in the form of a summary, the risk
level of the option.
(4) If the simple managed investment scheme has a balanced
investment option (within the meaning given by item 101 of Schedule 10),
section 5 must give the information mentioned in subclause (3) for the balanced
investment option, whether or not section 5 gives that information for any
other investment option.
(5) If the simple managed investment scheme does not
have a balanced investment option, section 5 must give the information
mentioned in subclause (3) for the investment option under which the entity has
the most funds invested, whether or not section 5 gives that information for
any other investment option.
(6) Section 5:
(a) must make provision for each investment
option which is not presented in section 5 in accordance with subclause (3),
(4) or (5); and
(b) may make provision for the option by
applying, adopting or incorporating matter in a document that:
(i) includes the information mentioned
in subclause (3); and
(ii) presents it in the way mentioned
in the subclause.
(7) The responsible entity:
(a) must provide information about how a member
may switch the member’s investments; and
(b) must provide information about:
(i) whether the simple managed
investment scheme’s investment options may be changed; and
(ii) if so, how the options may be
changed; and
(c) must describe, in the form of a summary, the
extent to which labour standards or environmental, social or ethical
considerations are taken into account in the selection, retention or
realisation of investments relating to the simple managed investment scheme;
and
(d) may provide the information in paragraphs (a)
to (c), and any additional information about investment options, by applying,
adopting or incorporating a matter in writing.
8 Contents of section 6
(Fees and costs)
(1) For each investment option of the simple managed
investment scheme that is presented in section 5 in detail in accordance with
subclause 7 (3), section 6 of the Product Disclosure Statement must
state:
(a) the cost of acquiring the option; and
(b) the fees and costs that are charged in
relation to the option.
Note The statement will be made using the
template set out in subclause (3).
(2) Before setting out any other substantive material,
section 6 must:
(a) set out the Consumer Advisory Warning in
clause 221 of Schedule 10; and
(b) give a concise example in the form set out in
the Consumer Advisory Warning in clause 221 of Schedule 10.
(3) Section 6 must set out
the fees and costs for each investment option that is presented in section 5 in
detail in accordance with subclause 7 (3), using the following template:
|
TYPE OF FEE OR COST
|
AMOUNT
|
|
|
Fees when your money moves in or out of the fund
|
|
|
|
Establishment fee
|
|
|
|
Contribution fee
|
|
|
|
Withdrawal fee
|
|
|
|
Termination fee
|
|
|
|
Management costs
|
|
|
|
The fees and costs for
managing your investment
|
|
[If there are other service fees, such
as advisor service fees or special request fees, include a cross reference to
the document that contains the information mentioned in paragraph (10) (a).].
(4) The template is to be completed in accordance with
Division 3 of Schedule 10 (including definitions applicable to that Division),
except that:
(a) clauses 203, 205, 206 and 207 and subclause
208 (2) do not apply; and
(b) the reference in clause 204 to clause 205 and
clause 206 does not apply; and
(c) the example in subclause 208 (1) is to
be treated as stating:
“(for example, by using an asterisk with a
footnote stating ‘The amount of this fee can be negotiated’)”.
(5) Section 6 must set out the information about fee
changes set out in paragraph 209 (k) of Schedule 10.
(6) Section 6 must:
(a) state that the information in the template
can be used to compare costs between different simple managed investment
schemes; and
(b) state concisely, and in general terms, that
fees and costs can be paid directly from the person’s account or deducted from
investment returns.
(7) Section 6 must give a worked example as follows:
(a) if the simple managed investment scheme does
not have a balanced investment option (within the meaning given by item 101 of
Schedule 10), section 6 must give a worked example for the default investment
option;
(b) if the simple managed investment scheme does
not have a default option, and does not have a balanced investment option,
section 6 must give a worked example for the investment option under which the
entity has the most funds invested;
in accordance with Divisions 5 and 6 of Schedule 10 (including
definitions applicable to those Divisions), except that clauses 211 and 220 do
not apply.
(8) Section 6:
(a) must refer to the calculator provided by
ASIC on its FIDO website or a similar website operated by or on behalf of ASIC;
and
(b) may also refer to the calculator (if any)
provided by the responsible entity on its website; and
(c) must state that each calculator referred to
can be used to calculate the effect of fees and costs on account balances.
(9) If additional fees may be payable to a financial
advisor, section 6 must:
(a) state, in the form of a warning, that
additional fees may be paid to a financial advisor if a financial advisor is
consulted; and
(b) refer to the Statement of Advice in which
details of the fees are set out.
(10) The responsible entity:
(a) must provide the fees and costs of each of
the investment options in accordance with Schedule 10, and may do so by
applying, adopting or incorporating a matter in writing; and
(b) may provide more detailed information about
fees and costs by applying, adopting or incorporating a matter in writing.
9 Contents of section 7 (How managed
investment schemes are taxed)
(1) Section 7 of the Product Disclosure Statement must
state, in the form of a warning, that:
(a) investing in a registered managed investment
scheme is likely to have tax consequences; and
(b) persons are strongly advised to seek
professional tax advice.
(2) Section 7 must also include statements to the
following effect:
(a) registered managed investment schemes do not
pay tax on behalf of members;
(b) members are assessed for tax on any income
and capital gains generated by the registered managed investment scheme.
(3) The responsible entity may provide additional
information about taxation matters relating to registered managed investment
schemes by applying, adopting or incorporating a matter in writing.
10 Contents of section 8 (How to apply)
(1) Section 8 of the Product Disclosure Statement must:
(a) describe, in the form of a summary, how to
invest in the simple managed investment scheme; and
(b) explain the cooling-off period that applies
to the simple managed investment scheme; and
(c) explain how to make a complaint (by means
that include the provision of relevant contact details).
(2) The responsible entity:
(a) may provide more detailed information about
cooling-off periods, complaints and dispute resolution; and
(b) may provide that information by applying,
adopting or incorporating a matter in writing.