ASIC CLASS ORDER [CO 09/38]
EXPLANATORY STATEMENT
Prepared by the Australian Securities and Investments Commission
Corporations Act 2001
The Australian Securities and Investments Commission (ASIC) makes ASIC Class Order [CO 09/38] under s951B(1)(c) of the Corporations Act 2001 (the Act).
Section 951B(1)(c) provides that ASIC may declare that Part 7.7 applies in relation to a class of persons or financial products as if specified provisions of Part 7.7 were omitted, modified or varied as declared.
1. Background
ASIC Class Order [CO 04/1556] was issued on 21 December 2004 and permitted providing entities (i.e. financial advisers) to streamline the process of providing additional advice to retail clients. ASIC Class Order [CO 04/1556] did this by modifying Part 7.7 of the Act so that providing entities providing additional advice to a retail client may use a Statement of Additional Advice (SOAA) to avoid repeating some information required under Part 7.7 of the Act. SOAAs were permitted under [CO 04/1556] where retail clients had already received a document from the providing entity that set out all the information required in a Statement of Advice (SOA) under the Act. The repetition of certain information was avoided by allowing providing entities to incorporate by reference relevant information required under Part 7.7 from an SOA previously provided to the retail client.
Regulation 7.7.09B was introduced by the Corporations Amendment Regulations 2007 (No. 10) and permits providing entities to avoid repeating information previously provided to retail clients by permitting the incorporation of information by reference into a Statement of Advice facilitating the same end as [CO 04/1556].
2. Purpose of the class order
ASIC Class Order [CO 04/1556] is now redundant given that the incorporation of certain SOA information by reference when providing additional advice is now permitted under reg 7.7.09B. The purpose of [CO 09/38] is to revoke the now redundant [CO 04/1556].
3. Operation of the class order
Paragraph 3 specifies the date, 1 September 2009 on which [CO 04/1556] will be revoked.
Paragraph 4 revokes [CO 04/1556].
5. Consultation
ASIC Class Order [CO 09/38] was made following limited external consultation with the Financial Planning Association and the Association of Financial Advisers in 2008. More extensive consultation was not undertaken because [CO 09/38] is of a minor and machinery nature relating to the removal of a now redundant class order.