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ASIC Class Order [CO 04/606]

Authoritative Version
  • - F2006B01240
  • No longer in force
CO 04/606 Orders/ASIC Class Orders as made
This Class Order varies ASIC Class Order [CO 02/294].
Administered by: Treasury
General Comments: This Class Order was published in the Australian Securities and Investments Commission Gazette on 15 June 2004.
Registered 11 Dec 2006
Gazetted 15 Jun 2004
Date of repeal 09 Aug 2013
Repealed by Treasury (Spent and Redundant Instruments) Repeal Regulation 2013

Australian Securities and Investments Commission

Corporations Act 2001 — Paragraphs 601QA(1)(a), 741(1)(a), 992B(1)(a) and 1020F(1)(a) — Variation

 

Under paragraphs 601QA(1)(a), 741(1)(a), 992B(1)(a) and 1020F(1)(a) of the Corporations Act 2001 the Australian Securities and Investments Commission varies Class Order [CO 02/294] as follows:

 

1.         in paragraph 1:

 

(a)        omit the definition of “accessible investments”, reinsert that definition after the definition of “accessible financial products”;

 

(b)        omit the definition of “accessible securities”, substitute:

 

““accessible securities” means securities that may be held through an IDPS.

 

“annual investor statement” means the report referred to in paragraph 2(e)(xiii)(A).”;

 

(c)        in the definition of “distribution reinvestment plan” omit:

 

(i)         “the current disclosure document for an accessible security or”; and

 

(ii)        “accessible security or” (second occurring);

 

(d)        omit the definition of “IDPS Guide”, substitute:

 

““IDPS Guide” means:

 

(a)        a document relating to an IDPS that contains the information described in paragraph 2(f); or

 

(b)        more than one document relating to an IDPS that taken together contain the information described in paragraph 2(f) where:

 

(i)         each document is given to the client at the same time; and

 

(ii)        each document refers to each other document.

 

If there are or may be different versions of a document of the kind referred to in paragraph (b), the reference required by subparagraph (b)(ii) does not have to identify any particular one of those versions and may instead identify the document generically.”;

 

(e)        omit the definitions of “new disclosure financial products”, “new product disclosure provisions”, “old Corporations Act” and “operator”, substitute:

 

““operator” means a holder of a financial services licence that includes a condition requiring the holder to comply with the requirements of this instrument, who contracts with a client for the provision of the IDPS or a function that forms part of the IDPS.”;

 

(f)         in the definition of “regular savings plan”:

 

(i)         omit paragraphs (a) to (c), substitute:

 

“(a)      the client instructs the operator to acquire specified accessible financial products by way of periodic payments of a specified amount and at specified intervals (each such acquisition is referred to below as a “regular savings acquisition”);

 

(b)        the client acknowledges that under the regular savings plan a regular savings acquisition of an accessible financial product may occur without the client having been given a current Product Disclosure Statement or Supplementary Product Disclosure Statement (each a “missing document”) in relation to the accessible financial product;

 

(c)        the operator agrees to give to the client any missing document relating to an accessible financial product (unless this would not be required under this instrument if the acquisition were not under a regular savings plan) that may be acquired under the regular savings plan as soon as reasonably practicable and in any event by the fifth business day after the issue of the document; and”; and

 

(ii)        omit paragraph (f) and all the following text, substitute:

 

“(f)       has been given advice quarterly in writing,

 

to the effect that the client may not have the current Product Disclosure Statement for an accessible financial product at the time a regular savings acquisition of the accessible financial product is made.”;

 

(g)        omit the definition of “relevant old legislation”, substitute:

 

““representative” has the meaning given by section 910A of the Act.”; and

 

(h)        omit the definition of “transition period”, substitute:

 

Note:    In this instrument a reference to doing an act, such as for example giving a document, includes a reference to causing or authoring it to be done: section 52 of the Act; paragraph 46(1)(a) of the Acts Interpretation Act 1901.”;

 

2.         in paragraph 2(c) omit “s.1012IA”, substitute “section 1012IA”;

 

3.         in paragraph 2(d) omit “2(e)(vii) or 2(e)(viii)”, substitute “2(e)(vi), (vii) or (viii)”;

 

4.         in paragraph 2(e) (introductory words) omit “after the date of this instrument”;

 

5.         in subparagraph 2(e)(iv) after “ADI” insert “(or an account of the kind referred to in subregulation 7.9.08(1) of the Corporations Regulations 2001)”;

 

6.         in subparagraph 2(e)(v) omit “or cause to be given” (twice occurring);

 

7.         in subparagraph 2(e)(vi)(A) omit “received an IDPS Guide that is current”, substitute “been given an IDPS Guide that would comply with these conditions if given”;

 

8.         in subparagraph 2(e)(vi)(C) omit “is up to date”, substitute “the person performing the transactional functions has no reason to believe is defective as defined in section 1021B of the Act”;

 

9.         in subparagraphs 2(e)(vii) and 2(e)(viii) (introductory words) omit “received an IDPS Guide that is current”, substitute “been given an IDPS Guide that would comply with these conditions if given”;

 

10.       in subparagraphs 2(e)(viii)(B), 2(e)(xii)(A) and 2(e)(xiii) (introductory words) omit “or cause to be given”;

 

11.       in subparagraph 2(e)(xiii)(A) omit “annual report”, substitute “annual investor statement”;

 

12.       omit subparagraphs 2(e)(xiii)(B), (C) and (D) and the introductory words to subparagraphs (C) and (D), substitute:

 

“(B)      a copy of the annual report or reports for the relevant IDPS financial year required by paragraph 2(j).”;

 

13.       in paragraph 2(f) (introductory words) omit “or cause to be given”;

 

14.       in subparagraph 2(f)(iii) omit the bracketed text and the brackets;

 

15.       in subparagraph 2(f)(iv) omit:

 

(a)        “new disclosure” (first to fifth occurring); and

 

(b)        the bracketed text and the brackets;

 

16.       in paragraph 2(g) omit “or cause to be given”;

 

17.       in paragraph 2(h) omit “or cause to be kept”;

 

18.       in paragraph 2(i) omit “or cause to be kept”;

 

19.       omit paragraph 2(j), substitute:

 

“(j)       An operator who performs the functions set out in column 2 of an item in the following table in relation to annual investors statements, quarterly reports or information made electronically accessible under subparagraph (2)(e)(xii), must after the end of each IDPS financial year cause a registered company auditor to provide one or more reports that set out each of opinions or statements set out in column 3 of the item in the table.  The opinions or statements of the auditor must cover the statements, reports or information in relation to which the operator performed the relevant functions.  None of the reports of the auditor may contain any statement that has or purports to have the effect of excluding or disclaiming liability to clients of the IDPS as users of the report.

 

 

Column 2

Column 3

 

 

ITEM

AN OPERATOR WHO

MUST CAUSE AN AUDITOR TO PREPARE A REPORT OR REPORTS SETTING OUT THE FOLLOWING OPINIONS AND STATEMENTS

1.

1.   prepares the statements, reports or information; and

2.   gives or makes it accessible to clients

 

(an operator who performs both these functions is referred to in this table as a “full service operator”)

1.   The auditor’s opinion as to whether internal controls and other procedures of the full service operator, each custodian and any other relevant person acting on behalf of that operator were suitably designed and operated effectively in all material respects to ensure that:

 

(a)  the annual investor statements for the relevant IDPS financial year, and quarterly reports for each quarter during the IDPS financial year where the annual investor statements do not purport to include particulars of each transaction that would be required in those quarterly reports, are or have been given to clients without material misstatements; and

 

(b) any information that is made accessible electronically under subparagraph 2(e)(xii) in respect of the IDPS financial year is not materially misstated.

 

 

 

2.   The auditor’s opinion as to whether the aggregates of assets (other than assets held by a client), liabilities, revenue and expenses shown in the clients’ annual investor statements for the relevant IDPS financial year have been properly reconciled to the corresponding amounts shown in the reports prepared by the custodian and which have been independently audited.

 

 

 

3.   The auditor’s statement as to whether or not the auditor has any reason to believe that:

 

(a)  any annual investor statement for the relevant IDPS financial year given to any client is materially misstated and, if the annual investor statements for the IDPS financial year do not generally purport to include particulars of each transaction that would be required in a quarterly report, whether any quarterly reports required to be given for the IDPS financial year are materially misstated; and

 

(b) any information accessible electronically by clients under subparagraph 2(e)(xii) that relates to any of the following was materially misstated:

 

(i)   transactions during the IDPS financial year;

 

(ii)  assets held during the IDPS financial year and any corresponding liabilities;

 

(iii) revenue and expenses for the IDPS financial year.

2.

1.   prepares the content of the statements, reports or information; and

2.   gives it to an operator (the “client contact operator”) covered by item 3 for giving or making available to clients

 

(an operator who performs both these functions is referred to in this table as a “back office operator”)

1.   The auditor’s opinion as to whether internal controls and other procedures of the back office operator, each custodian and any other relevant person acting on behalf of that operator were suitably designed and operated effectively in all material respects to ensure that:

 

(a)  the annual investor statements for the relevant IDPS financial year, and quarterly reports for each quarter during the IDPS financial year where the annual investor statements do not purport to include particulars of each transaction that would be required in those quarterly reports, are or have been given to the client contact operator without material misstatements; and

 

(b) any information given to the client contact operator to be made accessible electronically under subparagraph 2(e)(xii) during the IDPS financial year is not materially misstated.

 

 

2.   The auditor’s opinion as to whether the aggregates of assets (other than assets held by a client), liabilities, revenue and expenses shown in the clients’ annual investor statements for the relevant IDPS financial year given to the client contact operator have been properly reconciled to the corresponding amounts shown in the reports prepared by the custodian and which have been independently audited.

 

 

 

3.   The auditor’s statement as to whether or not the auditor has any reason to believe that:

 

(a)  any annual investor statement for the relevant IDPS financial year given to the client contact operator is materially misstated and, if the annual investor statements for the IDPS financial year do not generally purport to include particulars of each transaction that would be required in a quarterly report, whether any quarterly reports required to be given for the IDPS financial year are materially misstated; and

 

(b) any information provided for the purpose of its being made accessible electronically under subparagraph 2(e)(xii) that has been given to the client contact operator and relates to any of the following was materially misstated:

 

(i)   transactions during the IDPS financial year;

 

(ii)  assets held during the IDPS financial year and any corresponding liabilities;

 

(iii) revenue and expenses for the IDPS financial year.

 

 

3.

1.   receives the content of the statements, reports or information from a back office operator; and

2.   gives or makes it available to clients

 

(an operator who performs both these functions is referred to in this table as a “client contact operator”)

The auditor’s opinion as to whether internal controls and other procedures of the client contact operator and any other relevant person acting on behalf of the client contact operator were suitably designed and operated effectively in all material respects to ensure that:

 

(a)  the annual investor statements for the relevant IDPS financial year, and quarterly reports for each quarter during the IDPS financial year where the annual investor statements do not purport to include particulars of each transaction that would be required in those quarterly reports, that have been given to the client contact operator by the back office operator are given to each relevant client without material alteration; and

 

(b) any information given to the client contact operator by the back office operator to be made accessible electronically under subparagraph 2(e)(xii) that relates to any of the following:

 

(i)   transactions during the IDPS financial year;

 

(ii)  assets held during the IDPS financial year and any corresponding liabilities;

 

(iii) revenue and expenses for the IDPS financial year,

 

      is so made accessible without material alteration.

 

Note 1:   Internal controls and other procedures include any alternative controls and procedures employed by the operator to address deficiencies in the design or operation of established internal controls or other procedures.

 

Note 2:   The operator performing the functions referred to in item 3 of the table may add information relating to its identity, for example, by printing out statements on its own stationery.”;

           

20.       omit subparagraph 2(k)(ii)(B), substitute:

 

“(B)      lodge a copy of that report when lodging accounts under section 989B of the Act; and”;

 

21.       omit paragraph 2(l), substitute:

 

“(l)       The operator must take all reasonable steps to ensure that a person promoting the IDPS is a financial services licensee or a representative of a financial services licensee.”;

 

22.       omit paragraph 2(m), substitute:

 

“(m)     a document is taken as given to a person:

 

(i)         when it is received in accessible form by that person or their agent, being an agent (their “eligible agent”) who is not either:

 

(A)       the operator; or

 

(B)       an associate (within the meaning given by Division 2 of Part 1.2 of the Act as if this paragraph 2(m) were included in Chapter 7 of the Act) of the operator; or

 

(ii)        if there is no way of sending the document that may reasonably be expected to result in it being received by that person or their eligible agent — when all reasonable steps are taken to send it to that person or their eligible agent; or

 

(iii)       one business day after an email is sent to the email address of the person or their eligible agent that the operator reasonably believes is the address of the person or eligible agent where the person has agreed to receive the document by email; or

 

(iv)       one business day after an email is sent containing a hypertext link to the document to the email address of the person or their eligible agent that the operator reasonably believes is the address of the person or eligible agent where:

 

(A)       the person has agreed to receive documents in that manner; and

 

(B)       the operator has no reason to suspect that the person is unlikely by mere scrolling or use of direct hypertext links to be able to see all of the contents of the document by using the emailed hypertext link; and

 

(C)       the document can be downloaded free of charge (excluding any normal fees payable to the recipient’s internet service provider); and

 

(D)       the hypertext link is accompanied by a prominent statement to the effect that the recipient is advised to access the document and download it; or

 

(v)        when it would be delivered in the ordinary course of post, if it is posted as a letter prepaid from the operator to an address of the person or their eligible agent that the operator reasonably believes is the address of the person or eligible agent.

 

            For the purposes of this paragraph an email is “sent” when the email would be taken to be dispatched under section 14 of the Electronic Transactions Act 1999 if this instrument were a law of the Commonwealth for the purposes of that section.”;

 

23.       in paragraph 3 omit all the text before paragraph 3(c), substitute:

 

“A person (other than a person performing functions of the IDPS in accordance with a contract between that person and the client of the IDPS) who is involved in the operation or promotion of an IDPS is exempt from:”; and

 

24.       omit paragraph 3(d), substitute:

 

“(d)      Parts 6D.2 and 6D.3 of the Act for offers of accessible securities through the IDPS (except where the person is the issuer of those securities);”.


 

Dated this 1st day of June 2004

 

 

 

 

Signed by Brendan Byrne

as a delegate of the Australian Securities and Investments Commission