ASIC's main priority: "clear, accurate and balanced
information about a financial product or service"
According to Commissioner Kell, "a key lesson from the last
few years is that a proactive regulatory approach improves market
resilience and reduces the risk of investor losses compared to
This emphasis on proactive regulation will mean, in part,
greater scrutiny of the financial sector's advertising,
including online and mobile advertising.
a focus on the way that risk is explained in advertising,
particularly with words such as "guaranteed",
"secure", "free", etc;
ASIC's plans to work with the industry, starting with a
forum in the first half of this year; and
a thorough review of financial services advertising in rural
and regional areas, across all channels.
Future of Financial Advice (FOFA) reforms
ASIC is waiting for the FOFA legislation to be finalised before
it releases draft regulatory guidance, although its consultations
are already underway. The forthcoming regulatory guidance will
cover best interests duty, conflicted remuneration, ASIC's
amended licensing and banning powers, and scaled advice.
The last issue, scaled advice, will be a particular priority,
with draft legislation on intrafund advice expected in the next few
Reforms to disclosure laws are expected, so ASIC says it will
"take a keen interest in how disclosure will be made to
members and potential members about the features of MySuper
products, including fees and insurance... We are looking at
consistency of approach between our disclosure requirements and the
APRA data collection standards. This means industry can anticipate
further regulatory guidance from ASIC with regard to
Shorter PDS disclosure
The shorter PDS disclosure regime will be fully implemented by
22 June 2012, but the Government is still bedding down some aspects
of the shorter PDS regime. It will conduct further consultation
with industry and consumer groups to determine whether platform
products and multifunds should be completely out of the shorter PDS
regime (which they currently are), or in the regime but with
modified content requirements.
As part of this ASIC says it will provide relief so they can, at
the discretion of the provider, be included in the shorter PDS
It will also be dealing with some issues arising from the
reforms affecting complex products, interpretation, and the
definition of "simple MIS", and working to integrate the
Standard Risk Measures disclosure (the ASFA/FSC guidance) into the
shorter PDS regime.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
Persons listed may not be admitted in all states and
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This part will cover the legal position in relation to promotional materials and misleading and deceptive conduct.
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