Commonwealth Numbered Regulations Commonwealth Numbered RegulationsPart 1 Proposal 1.1
insert
7.7.10AA Obligation on authorised representative to give a financial services guide
For paragraph 951C (1) (c) of the Act, Part 7.7 of the Act applies as if subsection 941B (2) were omitted and the following subsection were substituted:
“(2) A Financial Services Guide must not be given to the person by the providing entity unless the authorising licensee, or each of the authorising licensees, on whose behalf the providing entity provides the financial services, has authorised its distribution by the providing entity.”
7.7.10AB Financial services guide— contents of guide
Financial services guide given by financial services licensee
(1) For paragraph 951C (1) (c) of the Act, Part 7.7 of the Act applies as if paragraph 942B (2) (c) of the Act were omitted and the following paragraph were substituted:
“(c) either:
(i) information about the financial services (the authorised services ) that the providing entity will be, or is likely to be, providing to the client, and the kinds of financial products to which those services relate; or
(ii) information about the kinds of financial services (the authorised services ) that the providing entity is authorised by its licence to provide, and the kinds of financial products to which those services relate; and”.
Financial services guide given by authorised representative
(2) For paragraph 951C (1) (c) of the Act, Part 7.7 of the Act applies as if paragraphs 942C (2) (c), (d) and (e) of the Act were omitted and the following paragraphs were substituted:
“(c) either:
(i) information about the financial services (the authorised services ) that the providing entity will be, or is likely to be, providing to the client, and the kinds of financial products to which those services relate; or
(ii) information, in relation to the authorising licensee or each of the authorising licensees, about the kinds of financial services (the authorised services ) that the providing entity provides as representative of the authorising licensee, and the kinds of financial products to which those services relate; and
(d) information about who the authorising licensee, or each of the authorising licensees, acts for when the authorised services are provided on their behalf by the providing entity; and
(e) a statement:
(i) setting out the name and contact details of the authorising licensee, or of each of the authorising licensees, mentioned in paragraph (d); and
(ii) stating that the providing entity is the authorised representative of that licensee or those licensees; and”.
Part 2 Proposal 1.2
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7.7.02A Situations when Financial Services Guide is not required
(1) For paragraph 951C (1) (c) of the Act, section 941C of the Act is modified by inserting after subsection 941C (1) the following subsection:
“(1A) The providing entity does not have to give the client a Financial Services Guide if the client has already received the documents referred to in paragraphs (7A) (b) and (c) , in the circumstances set out in that subsection, that together contain all of the information that the new Financial Services Guide is required to contain.”
(2) For paragraph 951C (1) (c) of the Act, section 941C of the Act is modified by inserting after subsection 941C (7) the following subsections:
“(7A) The providing entity does not have to give the client a Financial Services Guide in the following circumstances:
(a) if the providing entity will, or is likely to, provide a financial service to the client in a recommendation situation (see section 1012A), an issue situation (see section 1012B) or a sale situation (see section 1012C);
(b) the providing entity gives to the client a Product Disclosure Statement;
(c) the providing entity gives to the client a statement that:
(i) contains so much of the information required by section 942B or 942C (as the case may be), and any regulations made for the purposes of the appropriate section, as is not already set out in the Product Disclosure Statement; and
(ii) complies with the requirements set out in subsection (7B);
(d) the statements mentioned in paragraphs (b) and (c) are given at the same time.
(7B) The statement referred to in paragraph (7A) (c) must:
(a) be up to date as at the time it is given to the client; and
(b) may contain information apart from that referred to in subparagraph (7A) (c) (i); and
(c) meet the requirements of subsections 942B (3) and (6A) or subsections 942C (3) and (6A) (as the case may be).”
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7.7.10AF Various consequential amendments to Division 7 of Part 7.7 concerning situations where Financial Services Guides do not have to be given
(1) For paragraph 951C (1) (c) of the Act, Part 7.7 of the Act applies as if the provision set out in column 2 of the following table were modified as set out in columns 3 and 4:
| Column 1 | Column 2 | Column 3 | Column 4 |
|
Item | provision of Act | is modified by… | and… |
| 1 | paragraph (a) of the definition of defective in subsection 952B (1) | omitting “941D (2)” | substituting “941D (2) or paragraph 941C (7A) (c) or” |
| 2 | subparagraph (a) (iv) of the definition of defective in subsection 952B (1) | omitting “941D (2)” | substituting “941D (2) or paragraph 941C (7A) (c) or” |
| 3 | paragraph (d) of the definition of disclosure document or statement in subsection 952B (1) | omitting “946C (2)” | substituting “946C (2) or paragraph 941C (7A) (c),” |
| 4 | paragraph 952E (3) (a) |
omitting “946C (2)” | substituting “946C (2) or paragraph 941C (7A) (c),” |
| 5 | paragraph 952F (1) (b) | omitting “946C (2)” | substituting “946C (2) or paragraph 941C (7A) (c),” |
| 6 |
subparagraph 952F (1) (c) (i) | omitting “946C (2)” | substituting “946C (2) or paragraph 941C (7A) (c),” |
| 7 | paragraph 952G (1) (b) |
omitting “946C (2)” | substituting “946C (2) or paragraph 941C (7A) (c),” |
| 8 | subparagraph 952G (1) (c) (i) | omitting “946C (2)” |
substituting “946C (2) or paragraph 941C (7A) (c),” |
9 | paragraph (a) of the definition of defective in subsection 953A (1) |
omitting “941D (2)” | substituting “941D (2) or paragraph 941C (7A) (c) or” |
| 10 | subparagraph (a) (iv) of the definition of defective in subsection 953A (1) | omitting “941D (2)” | substituting “941D (2) or paragraph 941C (7A) (c) or” |
| 11 | paragraph (d) of the definition of disclosure document or statement in subsection 953A (1) | omitting “946C (2)” | substituting “946C (2) or paragraph 941C (7A) (c),” |
(2) For paragraph 951C (1) (c) of the Act, Part 7.7 of the Act applies as if subsection 940C (1) were modified by omitting “or a Statement of Advice” and substituting “, a Statement of Advice or a statement referred to in paragraph 941C (7A) (c)”.
(3) For paragraph 951C (1) (c) of the Act, Part 7.7 of the Act applies as if subsection 941D (4) were omitted and the following subsection were substituted:
“(4) The client must then be given:
(a) the statement referred to in paragraph 941C (7A) (c) together with a Product Disclosure Statement as required by paragraph 941C (7A) (b)) in accordance with the requirements of subsections 941C (7A) and (7B) ; or
(b) a Financial Services Guide;
within 5 business days after having given the statement referred to in subsection (3) , or sooner if practicable.”
(4) For paragraph 951C (1) (c) of the Act, Part 7.7 of the Act applies as if the following subsection were inserted at the end of section 941F:
“(2) If:
(a) a statement referred to in paragraph 941C (7A) (c) is given to the client before the financial service is provided; and
(b) the following conditions are satisfied:
(i) there is a change in circumstances before the service is provided and the statement does not contain the information it would be required to contain if it were given to a person immediately after that change;
(ii) the fact that the statement does not contain the up to date information is materially adverse from the point of view of a reasonable person deciding, as a retail client, whether to proceed to be provided with the financial service;
the providing entity must, before the service is provided, give the client another statement of the kind referred to in paragraph 941C (7A) (c) that contains the up to date information before the service is provided.”
Part 3 Proposal 1.3
[4] Subregulations 7.7.04 (2), (3) and (4)
substitute
Overview of regulation
(2) For paragraph 942B (4) (c) of the Act, the information required in particular situations by paragraph 942B (2) (e) in relation to persons mentioned in paragraph 942B (2) (e) or person 1 (see subregulation (1)) is as set out in subregulations (3), (4) and (5).
If remuneration is ascertainable at the time FSG is given
(3) If the remuneration (including commission) or other benefits are able to be ascertained at the time the Financial Services Guide is given to the client — the remuneration (including commission) or other benefits.
If remuneration is not ascertainable at the time FSG is given and personal advice will be given
(4) If:
(a) the remuneration (including commission) or other benefits are not able to be ascertained at the time the Financial Services Guide is given to the client; and
(b) the providing entity reasonably believes that personal advice will be given to the client;
the following information:
(c) either:
(i) particulars of the remuneration (including commission) or other benefits, including, to the extent relevant, a statement of the range of amounts or rates of remuneration (including commission) or other benefits; or
(ii) general information about the remuneration (including commission) or other benefits and the manner in which the remuneration (including commission) or other benefits are to be calculated;
(d) a statement that:
(i) if the remuneration (including commission) or other benefits are calculable at the time the personal advice is given, the remuneration (including commission) or other benefits the person receives on specific financial products to which the personal advice relates will be disclosed at the time the personal advice is given or as soon as practicable after that time; or
(ii) if the remuneration (including commission) or other benefits are not calculable at the time the personal advice is given, the manner in which the remuneration (including commission) or other benefits are to be calculated will be disclosed at the time the personal advice is given or as soon as practicable after that time.
If remuneration is not ascertainable at the time FSG is given and personal advice will not be given
(5) If:
(a) the remuneration (including commission) or other benefits are not able to be ascertained at the time the Financial Services Guide is given to the client; and
(b) the providing entity reasonably believes that personal advice will not be given to the client;
the following information:
(c) particulars of the remuneration (including commission) or other benefits, including, to the extent relevant, a statement of the range of amounts or rates of remuneration (including commission) or other benefits; or
(d) both of the following:
(i) general information about the remuneration (including commission) or other benefits and the manner in which the remuneration (including commission) or other benefits are to be calculated;
(ii) a statement that the client may request particulars of the remuneration (including commission) or other benefits but that the request must be made within a reasonable time after the client is given the Financial Services Guide and before any financial service identified in the Guide is provided to the client.
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7.7.04A Financial services guide given by financial services licensee: more detailed information about remuneration etc
(1) For subsection 942B (7) of the Act, if:
(a) the remuneration (including commission) or other benefits that a person mentioned in paragraph 942B (2) (e) or person 1 in subregulation 7.7.04 (1) has received, or is to receive, are not able to be ascertained at the time the Financial Services Guide is given to the client; and
(b) the providing entity reasonably believes that personal advice will not be given to the client; and
(c) the Financial Services Guide does not contain particulars of the remuneration (including commission) or other benefits;
the client may request, from the financial services licensee, particulars of the remuneration (including commission) or other benefits.
(2) A request under subregulation (1) must be made within a reasonable time after the client is given the Financial Services Guide and before any financial service identified in the Guide is provided to the client.
(3) For subregulation (1), the particulars must, to the extent relevant, include a statement of the range of amounts or rates of remuneration (including commission) or other benefits.
Examples
1 Remuneration is paid within the range of $X to $Y.
2 Commission is paid at rates between X% and Y%.
(4) The particulars mentioned in subregulation (3) must be presented in a manner that is easy for the client to understand.
[6] Subregulations 7.7.07 (2), (3) and (4)
substitute
Overview of regulation
(2) For paragraph 942C (4) (c) of the Act, the information required in particular situations by paragraph 942C (2) (f) in relation to persons mentioned in paragraph 942C (2) (f) or person 1 (see subregulation (1)) is as set out in subregulations (3), (4) and (5).
If remuneration is ascertainable at the time FSG is given
(3) If the remuneration (including commission) or other benefits are able to be ascertained at the time the Financial Services Guide is given to the client — the remuneration (including commission) or other benefits.
If remuneration is not ascertainable at the time FSG is given and personal advice will be given
(4) If:
(a) the remuneration (including commission) or other benefits are not able to be ascertained at the time the Financial Services Guide is given to the client; and
(b) the providing entity reasonably believes that personal advice will be given to the client;
the following information:
(c) either:
(i) particulars of the remuneration (including commission) or other benefits, including, to the extent relevant, a statement of the range of amounts or rates of remuneration (including commission) or other benefits; or
(ii) general information about the remuneration (including commission) or other benefits and the manner in which the remuneration (including commission) or other benefits are to be calculated;
(d) a statement that:
(i) if the remuneration (including commission) or other benefits are calculable at the time the personal advice is given, the remuneration (including commission) or other benefits the person receives on specified financial products to which the personal advice relates will be disclosed at the time the personal advice is given or as soon as practicable after that time; or
(ii) if the remuneration (including commission) or other benefits are not calculable at the time the personal advice is given, the manner in which the remuneration (including commission) or other benefits are to be calculated will be disclosed at the time the personal advice is given or as soon as practicable after that time.
If remuneration is not ascertainable at the time FSG is given and personal advice will not be given
(5) If:
(a) the remuneration (including commission) or other benefits are not able to be ascertained at the time the Financial Services Guide is given to the client; and
(b) the providing entity reasonably believes that personal advice will not be given to the client;
the following information:
(c) particulars of the remuneration (including commission) or other benefits, including, to the extent relevant, a statement of the range of amounts or rates of remuneration (including commission) or other benefits; or
(d) both of the following:
(i) general information about the remuneration (including commission) or other benefits and the manner in which the remuneration (including commission) or other benefits are to be calculated;
(ii) a statement that the client may request particulars of the remuneration (including commission) or other benefits but that the request must be made within a reasonable time after the client is given the Financial Services Guide and before any financial service identified in the Guide is provided to the client.
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7.7.07A Financial services guide given by authorised representative: more detailed information about remuneration etc
(1) For subsection 942C (7) of the Act, if:
(a) the remuneration (including commission) or other benefits that a person mentioned in paragraph 942C (2) (f) or person 1 in subregulation 7.7.07 (1) has received, or is to receive, are not able to be ascertained at the time the Financial Services Guide is given to the client; and
(b) the providing entity reasonably believes that personal advice will not be given to the client; and
(c) the Financial Services Guide does not contain particulars of the remuneration (including commission) or other benefits;
the client may request, from the authorised representative, particulars of the remuneration (including commission) or other benefits.
(2) A request under subregulation (1) must be made within a reasonable time after the client is given the Financial Services Guide and before any financial service identified in the Guide is provided to the client.
(3) For subregulation (1), the particulars must, to the extent relevant, include a statement of the range of amounts or rates of remuneration (including commission) or other benefits.
Examples
1 Remuneration is paid within the range of $X to $Y.
2 Commission is paid at rates between X% and Y%.
(4) The particulars mentioned in subregulation (3) must be presented in a manner that is easy for the client to understand.