Parliament enacts the Corporations Legislation Amendment (Simpler Regulatory System) Bill 2007
As flagged on our website on 30 May 2007, the Simpler Regulatory System Bill was introduced into Parliament on 24 May 2007. The Bill became law on 21 June, when Parliament passed the Bill without amendment. For a comprehensive summary of the changes affecting financial services regulation, please see Michael Hodgson’s paper on this topic at
www.daslaw.com.au
ASIC consults on proposals to modify requirements for management rights schemes
On 7 May 2007 ASIC released a consultation paper inviting comment, by 9 July 2007, on its proposal to modify existing relief for management rights schemes (investment schemes that involve holiday letting arrangement for strata units). The paper includes proposals on granting licensing relief to people giving financial product advice on these schemes and how the product disclosure provisions apply to these schemes, amongst others.
ASIC is reviewing PS 146
On 22 May 2007, ASIC advised that it is
reviewing its policy on retail financial adviser training standards, as set out in Policy Statement 146. In general ASIC is satisfied with the current standards and is not planning fundamental changes.
The review will focus on:
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the appropriateness of current standards for providers of general advice and providers of advice on general insurance products;
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whether the knowledge and skills categories in Appendix A should be broken down into a larger number of narrower categories;
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the administration of ASIC’s training register; and
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recognition of prior study and training.
ASIC issues technical updates to policy statements and class orders on FSR
On 28 May 2007, ASIC issued
technical updates to PS 168 Disclosure: Product disclosure statements (and other disclosure obligations), PS 175 Licensing: Financial product advisers – Conduct and disclosure, PS 182 Dollar disclosure, its Licensing guide and a number of class orders.
These documents have been amended to take account of changes to the Corporations Regulations made in December 2005 in relation to a number of minor and technical matters including:
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short form PDSs for all financial products except general insurance products;
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PDS exemptions for basic deposit products;
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tailored PDS requirements for general insurance products;
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refinements to retail/wholesale client tests;
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FSG and SOA exemptions and content refinements.
ASIC issues updated fees and costs disclosure guide
On 30 May 2007, ASIC issued a further
updated guide for product issuers to assist them comply with the enhanced fee disclosure regulations.
The updated guide provides answers to the following new questions:
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what is meant by “components” in clause 204(6) of Part 2 of Schedule 10;
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where fees etc are reduced, waived or a rebate is offered, what figure should be included in the calculation of management costs;
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can contingent fees be excluded from the calculation of management costs;
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how should issuers of managed investment products comply with the example of annual fees and costs;
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how should fees and costs information be disclosed for a stapled security;
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how should contributory mortgage issuers disclose transaction-specific information;
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how should start-up and initial one-off fees or costs be disclosed.
ASIC consults on licensing relief for venture capital trustees
On 31 May 2007, ASIC issued a
consultation paper on its proposed policy to give AFSL licensing relief to trustees of managed investment schemes that invest in unlisted companies where scheme members are wholesale clients.
ASIC has issued conditional interim class order relief to these trustees if the manager of the scheme, as an AFS licensee, accepts responsibility for financial services provided by the trustee as if the trustee were its representative. This will require an amendment to the manager's AFSL and the manager signing a deed poll for the benefit of scheme investors in which the manager undertakes to indemnify the scheme for certain liabilities relating to financial services provided by the trustee.
To view a print friendly version of this update please click on the PDF below.
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