Corporations Amendment Regulations 2002 (No. 2) (16 of 2002)

Schedule 1   Amendments commencing at 12.01 am (in the Australian Capital Territory) on 11 March 2002

[84]   Regulation 7.9.12

insert

(2) For paragraph 1020G (1) (c) of the Act, section 1017A of the Act is modified by adding after subsection 1017A (2):

'(2A) If the person has requested information in relation to an ongoing management charge for a particular investment strategy, and the product issuer or seller has provided a Product Disclosure Statement that includes information in accordance with paragraph 8.2 (b) of Schedule 10B to the Corporations Regulations 2001, the information must include the following:

(a) the information mentioned in paragraphs 8.1 (a), (b) and (c) of Schedule 10B;

(b) the statement:

'The approximate effect of the ongoing management charges (based on the charges for the year to [insert most recent year]) on your benefits can be shown by multiplying this percentage by the amount in your account. The following example shows the approximate amount of the ongoing management charges for an account balance of $10,000 in relation to the identified investment strategy. The actual effect of ongoing management charges will depend on the [insert 'fund's', 'life insurer's' or other appropriate description] charging arrangements and your individual circumstances. In particular, the amount in your account [if more than one identified investment strategy - and your chosen investment strategy] may have a significant effect on the amount of charges borne.';

followed by an example in relation to the identified investment strategy;

(c) the statements in paragraphs 8.4 (b), (c) and (d) of Schedule 10B;

(d) the statement:

'The ongoing management charge for a [insert 'fund', 'life insurer', 'provider of an annuity' or other appropriate description] is required by law to be calculated and disclosed. Its purpose is to give a broad indication of the level of costs incurred by a particular fund as a percentage of the value of assets.

Costs include all fees, charges and expenses except for [insert 'switching costs', 'entry and exit charges' or other appropriate description]. The level of costs incurred by an individual product holder will depend on individual circumstances and as a percentage of value of the fund assets of the individual may be more or less than the ongoing management charge.

The ongoing management charge should not be taken to be representative of the actual fees, charges and expenses that will be borne by an individual.

Full details of fees, charges and expenses applicable to individual circumstances are set out in [section X] of the Product Disclosure Statement.';

presented in accordance with item 8 of Schedule 10B.

(3) For paragraph 1020G (1) (c) of the Act, subsection 1017A (5) of the Act is modified by adding at the end of the subsection:

'(other than a charge for collecting or providing information in relation to an ongoing management charge for a particular investment strategy if the product issuer or seller has provided a Product Disclosure Statement that includes the information in accordance with item 8 of Schedule 10B to the Corporations Regulations 2001).'.