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ASIC releases minor updates to RG 97

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ASIC today released minor amendments to the fees and cost disclosure regime for issuers of superannuation and managed investment products.

A major update of Regulatory Guide 97 Disclosing Fees and Costs in PDSs and Periodic Statements (RG 97) and the associated legislative instrument were released in November 2019. ASIC has slightly amended RG 97 and the instrument to adjust the transitional timeframes in response to COVID-19 and to provide greater clarity on the obligations following additional feedback from industry.

Key changes

ASIC has amended the transitional arrangements for product disclosure statements (PDSs) in response to COVID-19:

  • PDSs given on or after 30 September 2022 must comply with the new requirements.
  • Issuers can choose to apply the new requirements from 30 September 2020.
  • Once an issuer has elected to apply the new requirements, all subsequent PDSs for that financial product must comply with the new requirements.

There is no change to the transition arrangements for periodic statements.

Minor technical refinements have been made to confirm ASIC’s policy positions in relation to:

  • the disclosure of buy/sell spreads in periodic statements for collective investment products under Class Order [CO 14/1252];
  • disclosure of performance fees;
  • the identification and treatment of derivative costs; and
  • significant event notice requirements.

ASIC has also clarified some definitions and amended the ‘Consumer advisory warning’ and ‘Example of annual fees and costs’ to correct inconsistencies between the templates in the legislative instrument and RG 97.

To give effect to these amendments ASIC has released:

More information about the new amendments can be found on our RG 97 website.

Next steps

ASIC will continue to monitor fees and costs disclosure and consider taking action where we find misconduct.

ASIC will continue to develop its proposals on disclosure by platforms. However it has deferred the public consultation on its proposals in response to COVID-19. (See: Changes to ASIC regulatory work and priorities in light of COVID-19)

Background

ASIC released the updated RG 97 in November 2019, following public consultation and an external expert review of the regulatory guide and consumer testing of proposed changes to the presentation of fees and costs.

In February and March 2020, ASIC held roundtable meetings with industry in Sydney, Melbourne and Brisbane to discuss the updates to RG 97. The presentation materials from the roundtables, including some frequently asked questions (FAQs), can be found on our RG97 website.

Industry was informed that ASIC would be making minor amendments to RG 97 at these roundtables and through FAQs on ASIC’s website. On 14 April 2020, ASIC announced that it was considering changes to the transition arrangements for PDS disclosure of the kind now implemented.

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Regulator Information

Abbreviation: ASIC
Jurisdiction: Australia

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