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ASIC Corporations (Time-sharing Schemes) Instrument 2017/272

 

About this compilation

 

Compilation No. 1

 

This is a compilation of ASIC Corporations (Time-sharing Schemes) Instrument 2017/272 as in force on 12 December 2020. It includes any commenced amendment affecting the legislative instrument to that date.

 

This compilation was prepared by the Australian Securities and Investments Commission.

 

The notes at the end of this compilation (the endnotes) include information

about amending instruments and the amendment history of each amended provision.

 

 

Contents

Part 1—Preliminary

1  Name of legislative instrument

3  Authority

4  Definitions

Part 2—Exemptions

5  Exemption for forfeiture for non-payment

5A Equality of treatment

6  Valuation of property of registered time-sharing schemes

Part 3—Declarations

7  Disclosure of prices for the purchase of time-sharing interests

7A Hardship withdrawals

8  Consequential modification of compliance plan requirements

8A Changing the constitution—hardship withdrawals

8B  Obligations on a holder of an Australian financial services licence

8C  Disclosure of fees and costs

Part 4—Transitional

9  Rental pools covered by ASIC Class Order [CO 02/237]

10  Application of amendments made by Corporations (Amendment)   Instrument 2020/1064

11  Disclosure of fees and costs—application to Product Disclosure Statements

12  Disclosure of fees and costs—application to periodic statements

13      Disclosure of fees and costs—transitional exemption from ongoing disclosure of material changes and significant events

Endnotes

Endnote 1—Instrument history

Endnote 2—Amendment history

Part 1—Preliminary

1 Name of legislative instrument

This is the ASIC Corporations (Time-sharing Schemes) Instrument 2017/272.

3 Authority

This instrument is made under subsections 601QA(1), 926A(2) and 1020F(1) of the Corporations Act 2001.

4 Definitions

Act means the Corporations Act 2001.

approved hardship member has the meaning given by subsection 601GA(1B) of the Act as notionally inserted by this instrument.

defaulting member has the meaning given by subsection 601GA(1B) of the Act as notionally inserted by this instrument.

registered time-sharing scheme means a time-sharing scheme:

(a) registered in accordance with section 601ED of the Act; and

(b) that has not at any time been promoted by its operator as a means of generating a financial return other than by way of a rental pool.

Regulations means Corporations Regulations 2001.

rental pool, in relation to a time-sharing scheme, means an arrangement conducted by the operator of the scheme where members of the scheme authorise the operator to manage and rent to third parties the rights to use property under the scheme and to pool the rental income received for pro-rata distribution to each holder.

Part 2—Exemptions

5 Exemption for forfeiture for non-payment

A responsible entity of a registered time-sharing scheme does not have to comply with paragraph 601FG(1)(a) of the Act in relation to the acquisition and holding by the responsible entity of an interest in the scheme that is forfeited by a defaulting member to the responsible entity if:

(a) the constitution of the scheme contains provisions that are to the effect of paragraphs 601GA(1A)(a) to (l) of the Act (as notionally inserted by this instrument); and

(b) the acquisition and holding is in accordance with those provisions.

5A Equality of treatment

A responsible entity of a registered time-sharing scheme does not have to comply with paragraph 601FC(1)(d) of the Act to the extent the requirement to treat members in the same class equally would prevent the responsible entity from allowing an approved hardship member to withdraw in accordance with provisions of the constitution of the scheme that are to the effect of paragraphs 601GA(1A)(b) to (l) of the Act as notionally inserted by this instrument.

6 Valuation of property of registered time-sharing schemes

(1) The responsible entity of a registered time-sharing scheme does not have to comply with paragraph 601FC(1)(j) of the Act in relation to the scheme.

Condition

(2) A responsible entity that relies on the exemption in subsection (1) must ensure that an item of scheme property of the scheme is valued as soon as practicable after the responsible entity has reasonable grounds to believe that a valuation of the item is in the best interests of members or is needed for the scheme to operate in a manner that is fair to all members.

(3) A responsible entity that has not complied with the condition in subsection (2) cannot rely on the exemption in subsection (1).

Part 3—Declarations

7 Disclosure of prices for the purchase of time-sharing interests

Chapter 5C of the Act applies to a responsible entity of a registered time-sharing scheme as if section 601GA were modified or varied as follows:

(a) in subsection (1), omit “The”, substitute “Subject to subsection (1A), the”;

(b) after subsection (1) insert:

“(1A) The constitution of a registered time-sharing scheme need not make adequate provision for the consideration that is to be paid to acquire an interest in the scheme if the constitution contains provisions to the effect of the following:

Acquisition price

(a) the consideration that is to be paid to acquire an interest in the scheme is:

(i) the price stated in the Product Disclosure Statement for the interests that is in use at the time of the acquisition; or

(ii) in relation to the sale of an interest of a defaulting member or approved hardship member by the responsible entity under a power of sale or due to forfeiture to the responsible entity—a price specified in paragraph (k);

Hardship withdrawals

(b) a member may give the responsible entity a hardship application, provided that if the responsible entity has received a hardship application (previous hardship application) from the member within the previous 3 months and has considered the previous hardship application:

(i) the responsible entity has a discretion whether or not to consider the current hardship application;

(ii) if the responsible entity decides not to consider the current hardship application:

(A) the responsible entity must notify the member in writing as soon as possible of its decision; and

(B) paragraphs (c) to (l) do not apply in relation to the hardship application;

(c) if the responsible entity receives a hardship application, the responsible entity:

(i) must, as soon as possible after receipt of the hardship application, give the member a written confirmation that the hardship application has been received; and

(ii) must consider whether further information is required to determine whether the member has met the hardship criteria and, if so, give a notice to the member by no later than 30 days after the day the responsible entity receives the hardship application:

(A) requiring further information; and

(B) allowing the member at least 21 days to respond; and

(iii) must, before the end of the decision period, make a decision whether the member has met the hardship criteria and, if so, whether to allow the member to withdraw from the scheme; and

Note 1: If the responsible entity allows the member to withdraw from the scheme, the member will be an approved hardship member: see subsection (1B).

Note 2: See section 601GAH in relation to the discretion of the responsible entity to allow a member to withdraw from the scheme.

(iv) must give the member a decision notice within 7 days of making the decision; and

(v) unless the responsible entity has given the member a decision notice, must not require the member to make payment of any amounts due for payment on or after the date the responsible entity received the member’s hardship application; and

(vi) may, to the extent provided for in the constitution and until the responsible entity gives the member a decision notice, suspend the rights of the member to use property under the scheme, receive distributions under the scheme or otherwise enjoy benefits produced by the scheme;

(d) if the responsible entity decides a member has not met the hardship criteria, the decision notice must include:

(i) reasons why the responsible entity has decided that the member has not met the hardship criteria; and

(ii) an explanation that, as the member has not met the hardship criteria, the member is not able to withdraw from the scheme;

(iii) details of the scheme’s internal and external dispute resolution schemes;

(e) if the responsible entity decides a member has met the hardship criteria but not to allow the member to withdraw from the scheme, the decision notice must include:

(i) reasons why the responsible entity has decided not to allow the member to withdraw from the scheme; and

(ii) details of the internal and external dispute resolution schemes;

(f) an approved hardship member:

(i) has a right to withdraw from the scheme in accordance with paragraph (h); and

(ii) has no liability to make payment of any amounts due for payment in relation to the scheme on or after the date the responsible entity received the member’s hardship application (including payment of any shortfall from the sale process referred to in paragraph (k)) ; and

(iii) if the approved hardship member was a defaulting member, has no liability to make payment of any amounts that are overdue for payment;

(g) the responsible entity may, to the extent provided for in the constitution, suspend the rights of an approved hardship member to use property under the scheme, receive distributions under the scheme or otherwise enjoy benefits produced by the scheme;

Forfeiture and sale circumstances

(h) subject to paragraphs (i) to (l), the responsible entity may, in accordance with the constitution, forfeit the interest of a defaulting member to the responsible entity, or exercise a power of sale of a defaulting member’s interest on behalf of a defaulting member;

(i) if the responsible entity receives a hardship application from a defaulting member, the responsible entity must not forfeit or exercise a power of sale of the interests of that member unless the responsible entity has:

(i) decided to reject the member’s hardship application; and

(ii) given the member a decision notice within the time required under subparagraph (c)(iv);

 

Sale process for defaulting member and approved hardship member

(j) the responsible entity must use reasonable endeavours to sell:

(i) the interest of a defaulting member if the interest has been forfeited to the responsible entity or if the responsible entity has decided to exercise a power of sale of the interest on behalf of the defaulting member; and

(ii) the interest of an approved hardship member;

(k) the price for which the responsible entity sells the interest of a defaulting member or an approved hardship member must be:

(i) if a Product Disclosure Statement has been given in accordance with Part 7.9 at any time in the 12 months before the sale for interests in the scheme that are in the same class—the price shown in the Product Disclosure Statement most recently given; or

(ii) otherwise—a fair market price obtained by the responsible entity using reasonable endeavours;

(l) the responsible entity must apply any proceeds of sale of a defaulting member or approved hardship member, or of other exploitation by it of the interest of the defaulting member or approved hardship member (including any proceeds of rental of, or licensing to use, the scheme property that relates to the interest of the member) in the following order:

(i) in payment of reasonable costs of the sale or exploitation;

(ii) in payment of any reasonable administrative costs arising from the forfeiture, sale or withdrawal;

(iii) in payment of any outstanding amounts due from the member as scheme property:

(A) for a defaulting memberthat were outstanding as at the date the interest is sold; or

(B) for an approved hardship memberthat were outstanding as at the date the responsible entity received the member’s hardship application;

(iv) in payment of any amounts that were overdue for payment by the member to the responsible entity other than as scheme property, or that were overdue for payment to any other person in relation to the member’s participation in the scheme on:

(A) for a defaulting memberthe date the interest is sold; or

(B) for an approved hardship memberthe date the responsible entity received the member’s hardship application;

(v) in payment of any amounts payable by or on behalf of the defaulting member or approved hardship member to a person in relation to a liability of the member to the person for amounts with respect to financial accommodation provided by the person in connection with the member’s acquisition of the interest;

(vi) in payment of any remaining amount to the defaulting member or approved hardship member.

Interpretation

(1B) For the purposes of subsections (1A) to (1C):

approved hardship member means a member of a registered time-sharing scheme who has received a decision notice from the responsible entity stating that the responsible entity has approved the member’s hardship application.

decision notice means a written notice of the responsible entity’s decision in relation to a hardship application.

decision period means, in relation to a hardship application, for each circumstance set out in column 2 of the following table, the period set out in column 3.

 

Decision period for giving a decision notice

Item

Column 2
circumstance

Column 3
decision period

1

The responsible entity does not require further information to make a decision.

30 days starting on the day the responsible entity receives the hardship application

2

The responsible entity requires further information, gives a notice requiring further information by a specified date, and does not receive the information from the member by that specified date.

30 days starting on the specified date

3

The responsible entity requires further information, gives a notice requiring further information by a specified date, and receives the further information on or before the date.

30 days starting on the day the responsible entity receives the further information

defaulting member means a member of a registered time-sharing scheme:

(a) whose interest may be forfeited to the responsible entity under the constitution; or

(b) on whose behalf the responsible entity may sell the interest of the member under the constitution;

as a result of a failure by the member to remedy the non-payment of an amount due to:

(c) the responsible entity as scheme property, including, amounts payable to acquire the interest or a levy; or

(d) a person with respect to financial accommodation provided to the member in connection with the acquisition by the member of the interest;

provided that a member who is an approved hardship member is not a defaulting member even if paragraph (c) or (d) is satisfied in relation to the member.

hardship application means an application by a member (or in the case of joint memberships, both members) of a registered time-sharing scheme, made to the responsible entity of the scheme, in writing, to withdraw from the scheme because the member meets the hardship criteria.

hardship criteria: see subsection (1C).

levy, in relation to a registered time-sharing scheme, means an amount paid or payable by members of a scheme for any of the following:

(a) the maintenance of scheme property;

(b) operating the scheme;

(c) other services relating to the scheme.

registered medical practitioner means a medical practitioner on the public register of practitioners maintained by the Australian Health Practitioner Regulation Agency or any successor agency.

registered time-sharing scheme means a time-sharing scheme:

(a)          registered in accordance with section 601ED; and

(b)          that has not at any time been promoted by its operator as a means of generating a financial return other than by way of a rental pool.

(1C) For the purposes of subsections (1A) to (1C), a member of a registered scheme meets the hardship criteria if:

(a) any of the hardship criteria specified in column 3 of the following table are satisfied in relation to the member (or in the case of joint memberships, any one member); and

(b) as a consequence, the member (or in the case of joint memberships, any one member) is unlikely to be able to use their interest in the scheme for the remainder of their membership.

 

Item

Column 2

hardship category

Column 3

hardship criteria

1

 

Severe Financial Hardship

The member or the member’s dependant is suffering severe long-term or permanent financial hardship.

2

Compassionate Grounds

The member or dependent is suffering a life-threatening illness or injury, chronic pain, or a severe, long-term chronic mental disturbance where a registered medical practitioner has provided a certified statement confirming the medical condition is of this nature.

3

Permanent Incapacity

The member has ceased gainful employment by reason of mental or physical ill-health and the member is unlikely ever again to engage in gainful employment of the type for which the member is reasonably qualified by education, training or experience.

 

7A Hardship withdrawals

Chapter 5C of the Act applies to a responsible entity of a registered time-sharing scheme as if the provisions of that Chapter were varied or modified as follows:

(a)          insert the following section in its relative order in Part 5C.3:

601GAH Discretions in relation to hardship withdrawals

(1) Despite subsection 601GA(4), the constitution of a registered time-sharing scheme (as defined in subsection 601GA(1B)) does not have to set out adequate procedures for making and dealing with withdrawal requests to the extent that the constitution gives the responsible entity a discretion to decide whether to allow or refuse a withdrawal request to which the following apply:

(a) the withdrawal request is in relation to a hardship application (as defined in subsection 601GA(1B)) in accordance with provisions of the constitution to the effect of paragraphs 601GA(1A)(b) to (l);

(b) the requirements set out in the constitution for allowing a withdrawal as a result of the hardship application are otherwise satisfied.

Exercise of discretion must be reasonable

(2) The responsible entity must act reasonably in exercising a discretion covered by subsection (1).

Note:    The responsible entity is also subject to its general duties under section 60IFC including the duty to act in the best interests of the members of the scheme.

(3) The responsible entity must ensure that it keeps records which document how and why a decision exercising a discretion covered by subsection (1) was made for a period of 7 years.;

(b) before subsection 601KA(3A) insert:

“(3AB) Subsection (3) and sections 601KB to 601KE do not apply to a withdrawal in accordance with provisions of the constitution of a registered time-sharing scheme (as defined in subsection 601GA(1B)) to the effect of paragraphs 601GA(1A)(b) to (l).”.

8 Consequential modification of compliance plan requirements

Chapter 5C of the Act applies to a responsible entity of a registered time-sharing scheme as if paragraph 601HA(1)(c) were modified or varied by after valued” inserting “in accordance with the conditions of any exemption under paragraph 601QA(1)(a) that exempts the responsible entity from paragraph 601FC(1)(j) or, if the responsible entity is not covered by such an exemption,”.

Note: Subsection 6(1) is an exemption of this kind.

8A Changing the constitution—hardship withdrawals

Chapter 5C of the Act applies to a responsible entity of a registered time-sharing scheme as if Part 5C.3 were modified or varied by:

(a) before subsection 601GC(2) inserting:

(1B) The constitution of a registered time-sharing scheme (as defined in ASIC Corporations (Time-sharing Schemes) Instrument 2017/272) may also be modified, or repealed and replaced with a new constitution, by the responsible entity in accordance with section 601GCD.”; and

(b) inserting the following section in its relative order in Part 5C.3:

601GCD Changing the constitution of a registered time-sharing scheme to enable hardship withdrawals

(1)          Subject to subsection (2), the responsible entity of a registered time-sharing scheme (as defined in ASIC Corporations (Time-sharing Schemes) Instrument 2017/272) may modify the constitution of the scheme to:

(a) include provisions to the effect of paragraphs 601GA(1A)(a) to (l) (as notionally inserted, or to be notionally inserted, as a result of ASIC Corporations (Amendment) Instrument 2020/1064); and

(b) make any other modifications that the responsible entity reasonably considers are necessary for, or incidental to, the responsible entity including provisions to the effect of paragraphs 601GA(1A)(a) to (l).

(2)          The responsible entity may modify the constitution under subsection (1) where:

(a) the responsible entity has given members of the scheme written notice of the modification by sending each member by post or by email a copy of a notice that complies with subsection (3); and

(b) the responsible entity has published a notice that complies with subsection (3) on its website:

(i)          no later than the date it gives written notice under paragraph (a); and

(ii)        in a way that is likely to come to the attention of a person looking for information about the scheme on the website; and  

(c) as at a date (relevant date) that is:

(i) no later than the date it gives written notice under paragraph (a) and (b); and

(ii) at least 14 days after the responsible entity gives notice to members under paragraph (a);

the responsible entity has not received requests from members with at least 5% of the votes that may be cast on the resolution referred to in paragraph (3)(b) to call and arrange to hold a meeting as specified in the notice.

(3) A notice complies with this subsection if it:

(a)           sets out a summary of the reason for, and the effect of, the proposed modification of the constitution; and

(b)          states that the responsible entity will modify the constitution as proposed unless it receives requests to call and arrange to hold a meeting of the scheme’s members to consider and vote on a special resolution to modify the constitution as proposed:

(i)            from members with at least 5% of the votes that may be cast on the resolution; and

(ii)          by the relevant date; and

(c)           states that a request referred to in paragraph (b) must be made in writing and may be sent to a specified email address of the responsible entity; and

(d)          is worded and presented in a clear, concise and effective manner.

(4) Unless the scheme’s constitution provides otherwise, a notice sent by post is taken to be given 3 days after it is posted. A notice sent by email is taken to be given on the business day after it is sent. 

(5) The responsible entity may repeal and replace the constitution instead of modifying it where:

(a)          the replacement constitution has the effect that the constitution would have had if it had instead been modified in accordance with subsection (1); and

(b)          subsection (2) had been satisfied as if references in subsections (2) and (3) to modifying the constitution included references to repealing and replacing it.

(6) The responsible entity may modify or repeal and replace the constitution under subsections (1) and (5) even if the constitution includes provisions to the effect that it may only be modified or repealed and replaced in accordance with paragraphs 601GC(1)(a) or (b) or provisions to the effect of those paragraphs.

(7) If the responsible entity:

(a) decides not to give members written notice (modification notice) under paragraph (2)(a) or under subsection (5) as it applies in relation to paragraph (2)(a); or

(b) does not give members a modification notice by 30 September 2021;

the responsible entity must give each member by post or by email written notice that complies with subsection (8) by no later than:

(c) if paragraph (a) applies—21 days after making the decision; and

(d)  if paragraph (b) applies—21 October 2021.

(8) A notice complies with this subsection if it includes an explanation of the following:

(a) why the responsible entity has decided not to give, or has not given, members a modification notice; and

(b) the effect for members of the responsible entity not giving members a modification notice compared to the situation if the responsible entity had given a modification notice; and

(c) that under section 252D, members holding interests carrying at least 5% of the votes that may be cast at a meeting of scheme may call and arrange to hold a meeting of the scheme’s members to consider and vote on a special resolution to modify or repeal and replace the constitution the constitution to include provisions to the effect of paragraphs 601GA(1A)(a) to (l) at the expense of those members.

Note: The responsible entity must act in the best interests of the members in exercising the power in subsections (1) and (5) to modify, or repeal and replace the constitution: see paragraph 601FC(1)(c)..

8B Obligations on a holder of an Australian financial services licence

Part 7.6 (other than Divisions 4 and 8) of the Act applies to a financial services licensee as if it were modified or varied by inserting the following sections in their relative order in Division 3 of Part 7.6:

912AJ Requirements for the provision of time-sharing interests

Application

(1) Subsections (3) to (19) apply to a licensee that is the responsible entity of a registered time-sharing scheme.

(2) Subsections (3) to (9) also apply to a licensee that is an associate of a responsible entity of a registered time-sharing scheme if the licensee:

(a) holds an Australian financial services licence authorising it to advise and deal in interests in a registered time-sharing scheme; and

(b) provides financial product advice to consumers about interests in a registered time-sharing scheme.

(3) A licensee must ensure each application form relating to an offer of interests for issue or sale by the licensee in the registered time-sharing scheme:

(a) is accompanied by a separate written statement (cooling-off statement) in the form set out in subsection 912AK(1); and

(b) is accompanied by the Product Disclosure Statement in relation to the interests if:

(i) in any case—a Product Disclosure Statement is required to be given to the applicant in relation to the offer under Part 7.9; or

(ii) in the case of an offer for salea Product Disclosure Statement would have been required to be given under Part 7.9 if the offer had been an offer for issue; and

(c) contains a question about whether the applicant intends to seek finance to pay for the interest in the time-sharing scheme and a description of an applicant’s subject to finance right to withdraw under paragraph (10)(b), and how those rights may be exercised; and

(d) is accompanied by a separate written notice (subject to finance notice) in the form set out in subsection 912AK(2).

(4) A licensee must not require an applicant to accept any finance offered to the applicant.

(5) A licensee must take reasonable steps to ensure an applicant is given a spoken warning (verbal consumer warning) consisting of the words set out in subsection 912AK(4) if the applicant is present during any seminar or sales presentation (whether conducted in person or by telephone or electronic communication) relating to the registered time-sharing scheme and which involves the licensee or any of its representatives.

(6) A licensee must not issue or sell an interest in a registered time-sharing scheme to an applicant, or allow any of its associates to do so, unless the applicant has provided the responsible entity of the scheme with the applicant’s signed and dated:

(a)          acknowledgement of receipt of the cooling-off statement; and

(b)          acknowledgement of receipt of the subject to finance notice.

(7) A licensee must maintain written records of the following for a period of 7 years:

(a)          the name of each applicant the licensee gives a cooling-off statement to;

(b)          the date the licensee gives a cooling-off statement to an applicant;

(c) each signed and dated acknowledgement of receipt of the cooling-off statement provided to the licensee by an applicant.

(8) A licensee that receives an application for an interest in a registered time-sharing scheme from an applicant must give the applicant copies of the following documents for the applicant to keep by the day referred to in subsection (9):

(a)          the applicant’s signed and dated application form;

(b)          a copy of the Product Disclosure Statement, if it is given under subparagraph (3)(b)(i);

(c)          if there is no Product Disclosure Statement for the interests in use before a person acquires an interest in the schemethe information referred to in subparagraph (13)(b) in writing;

(d) the applicant’s signed and dated acknowledgement of receipt of:

(i) the cooling off statement; and

(ii)  the subject to finance notice.

(9) The day by which a licensee must give the documents referred to in subsection (8) to an applicant is:

(a) if the applicant has given the application to the licensee in person—the day on which the licensee receives the application; and

(b) otherwise—the next business day after the day the licensee receives the application.

Cooling-off rights and subject to finance rights

(10) A licensee that is the responsible entity of a registered time-sharing scheme must confer on an applicant for the issue or sale of an interest in the scheme from the licensee or an associate referred to in subsection (2) a right to withdraw an application made by the applicant and a right to return the interest in the scheme (if applicable), if the applicant notifies the licensee by post, email or facsimile or in any manner described in the Product Disclosure Statement for interests in the scheme that:

(a) (cooling-off rights) the applicant does not wish to proceed with the issue or sale of the interest, and the notification is made within the period (cooling-off period) commencing on the date on which the applicant signs the acknowledgement of receipt of the cooling-off statement and ending:

(i) if the licensee is a member of the Australian Timeshare & Holiday Ownership Council Limited ACN 065 260 095—no less than 7 days later; or

(ii) otherwiseno less than 14 days later; or

(b) (subject to finance rights) the applicant:

(i) failed to obtain finance; or

(ii) decided not to proceed with an application for finance; or

(iii) rejected an offer of finance.

Effect of the exercise of cooling-off rights and subject to finance rights by an applicant

(11) A licensee that is the responsible entity of a registered time-sharing scheme must make adequate arrangements to ensure that where an applicant exercises cooling-off rights during the cooling-off period or exercises subject to finance rights:

(a) subject to paragraph (c), any contract for the acquisition of the interest in the time-sharing scheme is terminated without financial penalty to the applicant; and

(b) subject to paragraph (c), if the interest in the time-sharing scheme is constituted by a legal relationship between the applicant and the licenseethat relationship is terminated without financial penalty to the applicant; and

(c) if the applicant exercises rights by giving a notification referred to in subsection (10), the applicant is entitled to be refunded by the licensee:

(i) all monies paid by the applicant to the licensee in relation to the issue or sale of the interest in the scheme; and

(ii) the amount of any finance application fee paid to a related finance provider, less the reasonable value of the services supplied by the related finance provider up to the date the application was withdrawn or the interest was returned.

(12) A licensee that is the responsible entity of a registered time-sharing scheme must ensure the cooling-off rights and subject to finance rights are disclosed prominently in any Product Disclosure Statement for the offer of interests in the scheme.

(13) A licensee that is the responsible entity of a registered time-sharing scheme must ensure:

(a) any Product Disclosure Statement for interests in the scheme and any website that is maintained by or on behalf of the responsible entity for the scheme, explains:

(i) if the constitution for the scheme contains provisions to the effect of paragraphs 601GA(1A)(b) to (l) as notionally inserted by ASIC Corporations (Time-sharing Schemes) Instrument 2017/272:

(A) that a member may lodge a hardship application requesting to withdraw from the scheme due to hardship;

(B) the hardship criteria and the procedures set out in paragraphs 601GA(1A)(b) to (l); and

(ii) if the constitution does not contain provisions to the effect of paragraphs 601GA(1A)(a) to (l)—the reason why the constitution has not been modified to include such provisions;

(iii) if applicable, that the responsible entity may forfeit a member’s interest or exercise a power of sale on behalf of a defaulting member;

(iv) if applicable, the responsible entity’s procedures for forfeiting a member’s interest or exercising a power of sale on behalf of a defaulting member; and

(b) before an applicant acquires an interest in the scheme from the responsible entity or an associate at a time when no Product Disclosure Statement for the interests is in use—the person has been given the information referred to in paragraph (a) in writing.

Written consumer warning and prominent summary of key features in the Product Disclosure Statement

(14) A licensee that is the responsible entity of a registered time-sharing scheme must ensure that any Product Disclosure Statement for an interest in the scheme contains:

(a) on the front cover, a boxed warning (written consumer warning) in the form set out in subsection 912AK(3);

(b) on or before page 7 of the Product Disclosure Statement (counting the cover of the Product Disclosure Statement as page 1 of the Product Disclosure Statement), the following information:

(i) the membership term applicable to membership of the scheme;

(ii) any criteria used by the responsible entity to identify persons the responsible entity considers most likely to be:

(A)        suited to the scheme; and

(B)        interested in acquiring an interest in the scheme through its sales presentations (if applicable);

(iii) a description of the restrictions on the ability of members to cease holding an interest if they no longer want to hold an interest;

(iv) a statement to the effect that a member should have no expectation of being able to sell the membership on any market or get any money back;

(v) a description of the cooling-off period, the subject to finance rights, and the cooling-off rights;

(vi) a description of the key limitations on access to accommodation (such as seasonality or other factors);

(vii)  a summary of the fees and costs involved in acquiring and holding an interest that contains a cross-reference to where further information about those fees and costs can be found in the Product Disclosure Statement;

(viii)  for schemes with a points-based program—a summary of how the program works and a cross-reference to where further information about the operation of the program can be found in the Product Disclosure Statement.

Licensee must notify of non-compliance

(15) If a licensee that is the responsible entity of a registered time-sharing scheme becomes aware that it, or any of its associates, has failed to comply with any of subsections (3), (application accompanied by a cooling-off statement and subject to finance notice), (5) (verbal consumer warning), (6) (signed and dated documents received from applicant), and (8) (give applicant copies of specified documents)  in relation to the issue or sale of an interest in a time-sharing scheme to an applicant by the licensee, the licensee must immediately give a written notice to the applicant that:

(a) describes the failure to comply; and

(b) the applicant may give the licensee a written notice by post or by any manner described in the Product Disclosure Statement within 21 days of the date of the licensee’s notice to the applicant of its failure to comply; and

(c) specifies that if the applicant gives the licensee a notice referred to in paragraph (b):

(i) the applicant will be entitled to a refund from the licensee within 14 days of the notice of all amounts paid in relation to the interest in the scheme and any application for finance from a related finance provider (less the reasonable value of the services supplied by the related finance provider up to the date of termination of any contract between the applicant the credit provider and less any amount paid to the applicant under a provision of the constitution of the scheme to the effect of subparagraph 601GA(1A)(l)(vi)); and

(ii) any contract (other than the constitution of the scheme) between the applicant and licensee in relation to the interest in the time-sharing scheme will be void; and

(iii) the interest in the scheme will be returned to the responsible entity.

Charges and levies

(16) A licensee that is the responsible entity of a registered time-sharing scheme must:

(a) pay and ensure that any of its associates pay the same continuing charges and levies (such as maintenance levies and special levies) as a member would be required to pay in relation to the same interest held in that scheme; and

(b) provide to each member, for each period that the member is charged levies:

(i) a notice of the levies payable by the member for the period; and

(ii) a copy of the budget which relates to that period.

(17) A licensee that is the responsible entity of a registered time-sharing scheme may give either or both of the documents referred to in subparagraphs (16)(b)(i) and (ii) by:

(a) publishing the document on the responsible entity’s website; and

(b) notifying a member of the website publication using:

(i) a method of communication for the notification the member has consented to; or

(ii) any means a member has consented to for communication of the document.

Application monies for an interest in a scheme relating to property development

(18) A licensee that is the responsible entity of a property development scheme must:

(a) ensure that all deposit money it receives from an applicant is deposited with an Australian ADI in an account that is held on trust for the applicant, not later than the business day following receipt and is not applied in any manner other than by payment to another such account until:

(i) a registrable dealing conferring title on the applicant to any real property in relation to the scheme and in relation to the interests being acquired by the applicant is lodged with the relevant authority responsible for receiving lodgements relating to real property titles; and

(ii) the construction of the property to which the interests being acquired by the applicant relates, and any improvements necessary to permit normal use of the property under the scheme, is substantially completed; and

(b) if the licensee becomes aware that:

(i) a registrable dealing conferring title on the applicant to any real property in relation to the scheme and in relation to the interests being acquired by an applicant is not lodged with the relevant authority by the date specified in the Product Disclosure Statement; or

(ii) the construction of the property and improvements is not substantially completed by the date specified in the Product Disclosure Statement;

return to the applicant the following:

(iii) any deposit money paid by the applicant;

(iv) any income earned on the deposit money (less deductions of any fees and disbursements properly chargeable against the income);

(v) any amounts paid under a contract with a related finance provider; and

(c) ensure that any amount it requires to be paid by an applicant for the acquisition of an interest in the scheme (including any amount paid under a contract with a related finance provider) is no more than 30% in value of the price payable for the interest, if the property development or part of the property development has not been completed to the stage at which it is ready for occupation.

Points-based programs

(19) A licensee that is the responsible entity of a registered time-sharing scheme that operates a points-based program must:

(a) ensure that issues of interests in the scheme only occur where the responsible entity is satisfied on reasonable grounds that existing members of the scheme (if any) will continue to have access to the benefits of the scheme that they would reasonably expect to have based on:

(i) the Product Disclosure Statements for an interest in the scheme that were in use at the times the interests were acquired by the existing members; and

(ii) advertisements and promotional material for an interest in the scheme that were in use at the times the existing member acquired interests in the scheme; and

(b) establish and maintain compliance measures that ensure, as far as is reasonably practical, that:

(i) for an allocation points-based program:

(A) the pricing of the points issued to members is in accordance with the scheme’s constitution and the Product Disclosure Statement for an interest in the scheme; and

(B) the total number of points issued to members for scheme accommodation is in accordance with the scheme’s constitution; and

(C) the allocation of periodic points to each member occurs in accordance with the scheme’s constitution and the relevant Product Disclosure Statement.

(ii) for a PAYG points-based program:

(A) the price paid for interests (including in relation to PAYG points) is in accordance with the scheme’s constitution and the Product Disclosure Statement for an interest in the scheme; and

(B) the total number of PAYG points issued to members is in accordance with the scheme’s constitution; and

(C) PAYG points are redeemed for the use of scheme property at the time the points are purchased.

Deemed compliance with licence conditions

(20) A licensee referred to in subsection (1) or (2) that complies with the subsections specified in column 2 of the table below has the effect specified in column 3 of the table.

Deemed compliance with licence conditions

Item

Column 2
A licensee who complies with:

Column 3
is taken to comply with any condition to which its licence is subject dealing with:

1

subsections (3), (7), (10), (11) and (13)

mandatory cooling-off periods for time-sharing schemes

2

subsection (16)

charges and levies for time-sharing schemes

3

subsection (18)

handling of application monies for property development schemes

Interpretation

(21) In this section:

allocation points-based program, in relation to a registered time-sharing scheme, means a points-based program where a person:

(a) becomes a member of the scheme by purchasing a specified number of points; and

(b) as a member of the scheme, is entitled to be issued with a recurrent right to use scheme property in the form of a periodic allotment of points for:

(i)            the duration of the scheme; or

(ii)         a specified term of not less than 3 years.

applicant, in relation to a registered time-sharing scheme, means an applicant for an interest in the scheme, whether by issue or sale.

associate, in relation to a responsible entity of a registered time-sharing scheme, has the meaning given by section 11, but excludes a natural person who satisfies all of the following:

(a) the person holds an interest in the scheme;

(b) the person has notified the responsible entity that the person holds the interest for their own personal use;

(c) the responsible entity has reasonable grounds to believe the person holds the interests for their own personal use.

budget means the estimated and itemised material expected income and expenditure for a scheme for a financial year or calendar year.

cooling-off statement: see paragraph (3)(a).

cooling-off rights means the rights referred to in paragraph (10)(a).

hardship application has the same meaning as in subsection 601GA(1B) (as notionally inserted by ASIC Corporations (Time-sharing Schemes) Instrument 2017/272).

hardship criteria has the same meaning as in subsection 601GA(1C) (as notionally inserted by ASIC Corporations (Time-sharing Schemes) Instrument 2017/272).

PAYG membership, in relation to a registered time-sharing scheme, means a membership in a PAYG points-based program.

PAYG points, in relation to a registered time-sharing scheme, means pay-as-you-go points that:

(a)          may only be purchased by a member of a PAYG points-based program; and

(b)          may be used by the member to obtain the right to use property to which the scheme relates at the time the points are purchased.

PAYG points-based program, in relation to a registered time-sharing scheme, means a points-based program where a person:

(a)          becomes a member of the scheme by purchasing a PAYG membership for a specified term of not less than 3 years; and

(b)          as a PAYG member of the scheme is entitled to purchase PAYG points for the duration of that term.

point, in relation to a registered time-sharing scheme, means a unit of measurement of the amount payable for the use of property to which the scheme relates.

points-based program, in relation to a registered time-sharing scheme, means a program where members of the scheme can use points to obtain the right to use property to which the scheme relates.

property development scheme means a registered time-sharing scheme where, at the time an application is received for an interest in the scheme where that interest relates to a property under construction, the relevant property has not been completed to a stage where it is ready for occupation.

registered time-sharing scheme means a time-sharing scheme:

(a) registered in accordance with section 601ED; and

(b) that has not at any time been promoted by its operator as a means of generating a financial return other than by way of a rental pool.

related finance provider means a person who:

(a) is an associate of the responsible entity of a registered time-sharing scheme; and

(b) provides loans for the purchase of interests in the scheme.

rental pool, in relation to a time-sharing scheme, means an arrangement conducted by the operator of the scheme where members of the scheme authorise the operator to manage and rent to third parties the rights to use property under the scheme and to pool the rental income received for pro-rata distribution to each holder.

subject to finance notice: see paragraph (3)(d).

subject to finance rights means the rights referred to in paragraph (10)(b).


912AK Approved forms of statements

(1)          The statement set out below is the cooling-off statement referred to in paragraph 912AJ(3)(a).             

COOLING-OFF PERIOD FOR THE [INSERT NAME OF SCHEME] TIME-SHARING SCHEME

Your right to change your mind

You may withdraw your offer or terminate your agreement to purchase an interest in this time-sharing scheme within [ *** ] [1] days after the Acknowledgment Date.

The Acknowledgment Date is the date when you sign an acknowledgment that you have received all the relevant documents relating to the time-sharing scheme (these are the application form, the Product Disclosure Statement, any loose-leaf price list, this cooling-off statement and if relevant a subject to finance notice).

How can I exercise my right?

You may exercise your right to withdraw from the purchase by giving the responsible entity of the scheme a notice to that effect. The recommended form of written notice is attached to this statement.

You may give a notice to the responsible entity by one of the following:

 

Remember to cancel your loan application: If you have already signed an application with an ‘offer to borrow’ and you exercise your cooling-off right, you also need to notify the lender that you want to withdraw your offer.  You should do this as quickly as possible. If you do not, and the lender accepts your offer, you may have a binding loan contract and may not be able to cancel.

Acknowledgment

I/We ..................................................

acknowledge receipt of this cooling-off statement, the application form, the Product Disclosure Statement and any loose-leaf price list.

Signature(s): ...................................

Date: ..................................................

 

---------------------------------------------------------------------------------------------------------

 

WRITTEN NOTICE OF EXERCISE OF MY/OUR COOLING-OFF RIGHTS

To: [insert name and address of responsible entity]

I/We, [insert name(s)] hereby exercise my cooling-off rights and withdraw from my proposed purchase of interest(s) in the time-sharing scheme known as [insert name of scheme]. Please return all money I/We have paid by way of deposit or otherwise as soon as possible by (please tick or circle one):

BSB:

 

Account number:

 

Account name:

 

Consumer 1

Signature:

 

Name:

 

Date:

 

Consumer 2 (if applicable)

Signature:

 

Name:

 

Date:

 

Footnotes

1 Here the responsible entity should insert the number of days of the cooling-off period. That number of days must be:

(a)                 not less than seven days where the responsible entity is a member of the Australian Timeshare and Holiday Ownership Council ATHOC) or another industry supervisory body for the time-sharing line industry approved by ASIC; and

(b)                 not less than 14 days in all other cases.

 

(2)     The statement set out below is the subject to finance notice referred to in paragraph 912AJ(3)(d).


Timeshare cancellation: ‘Subject to finance’ notice

You can cancel your application for a timeshare if it is ‘subject to finance’
that is, if you are using a loan from a finance company to buy the timeshare –
even if the cooling-off period has already ended.

You can cancel your timeshare application if you:

To cancel the timeshare application: complete the form attached to this statement and send a copy to [responsible entity]. Their details are on the form.

Remember to cancel your loan application: If you have already signed an application with an ‘offer to borrow’ and you don’t want to go ahead with the loan, you also need to notify the lender that you want to withdraw your offer.  You should do this as quickly as possible. If you do not, and the lender accepts your offer, you may have a binding loan contract and may not be able to cancel.

What is this for?

This Timeshare cancellation: ‘Subject to finance’ notice is for consumers who applied for a loan but did not get a loan or decided not to proceed with their application for the loan. It can be used to cancel a timeshare application after the cooling-off period has ended.

Regardless of whether you applied for a loan or not, you may cancel your timeshare application within the [insert length – for example, ‘7’]-day cooling-off period by completing and sending a ‘cooling-off’ notice to [responsible entity]. The cooling-off notice is attached to the cooling-off statement and can be found [insert locationfor example, ‘at the front of your document pack’].

I applied for a loan – How do I cancel?

To cancel your timeshare application under these rights, you need to make sure the loan application is not going ahead (by notifying the lender in the way described in the documentation provided by the lender) and complete the form attached to this statement (the Timeshare cancellation: ‘Subject to finance’ form on page 2) and send a copy of it to [responsible entity] by one the following:

[If responsible entity has a website link that makes it easy for consumers to cancel in accordance with these rights, insert that link – for example ‘You can also go to [link] and follow the instructions.]

Acknowledgment

I/We

 

acknowledge receipt of this subject to finance notice.

Signatures(s):

 

Date:

 

Want to know more about timeshare? Go to www.moneysmart.gov.au


Timeshare cancellation: ‘Subject to finance’ form

Complete this form and send to [responsible entity] to cancel your timeshare application

To: [name of responsible entity], as responsible entity of [name of time-sharing scheme]

I/We

 

of address

 

do not wish to proceed with the application to purchase an interest (timeshare) in the [name of time-sharing scheme] because I/we made an application for finance and have:

I/We request any money paid for the timeshare application, and any money paid in relation to the finance application (if the finance provider is related to [responsible entity]), be returned by (please tick or circle one):

BSB:

 

Account number:

 

Account name:

 

Consumer 1

Signature:

 

Name:

 

Date:

 

Consumer 2 (if applicable)

Signature:

 

Name:

 

Date:

 

Ways to give the subject to finance cancellation notice

Send this notice to [responsible entity] by emailing it to [responsible entity’s email address], faxing it to [responsible entity’s fax number] or posting it to [responsible entitys postal address].

Keep a copy of this notice or the information you have provided for your records


(3)          The boxed statement set out below is the written consumer warning referred to in paragraph 912AJ(14)(a).

 

Consumer warning

Timeshares are not appropriate for everyone. You should take time to consider whether buying this timeshare is right for you before you sign the application form.

It is important to understand:

1. Timeshares are generally very long term. The term of this timeshare is [state period of this scheme in years or different years of the PAYG memberships]. You will generally be required to pay ongoing costs for as long as you own the timeshare, regardless of whether or not you use the timeshare. [Insert if applicable This includes any costs of financing the purchase].

2. [Insert if applicable You are not guaranteed the type of accommodation or location you want at the time you want.]

3. After the cooling-off period has ended, [insert if applicable and you have not withdrawn your application under any subject to finance rights,] it may be difficult to get out of this timeshare and there is no guarantee that you will be able to sell it to another person or get any money back.

 4. Timeshares are not an investment and you should not expect any financial return from a timeshare. You are buying an interest in a managed investment scheme for recreational use [insert if applicable and not buying real property].

 

(4)          The statement set out below is the verbal consumer warning notice referred to in subsection 912AJ(5).

Timeshares are not appropriate for everyone. You should take time to consider whether buying this timeshare is right for you before you sign the application form.

It is important to understand:

1. Timeshares are generally very long term. The term of this timeshare is [state period of this scheme in years or different years of the PAYG memberships]. You will generally be required to pay ongoing costs for as long as you own the timeshare, regardless of whether or not you use the timeshare. [Include if applicable This includes any costs of financing the purchase.]

2. [Include if applicable You are not guaranteed the type of accommodation or location you want at the time you want.]

3. After the cooling-off period has ended, [include if applicable and you have not withdrawn your application under any subject to finance rights], there are limitations on your ability to get out of this timeshare and there is no guarantee that you will be able to sell it to another person or get any money back.

4. Timeshares are not an investment and you should not expect any financial return from a timeshare. You are buying an interest in a managed investment scheme for recreational use [include if applicable and not buying real property]..

8C Disclosure of fees and costs

Part 7.9 of the Regulations applies in relation to interests in a registered time-sharing scheme as if the provisions of that Part were modified or varied as follows:

(1) omit subregulation 7.9.16N(2) of the Regulations, substitute:

(2) Subject to subregulation (3), the fees section of a Product Disclosure Statement for an interest in a registered time-sharing scheme must include:

(a) the applicable Purchase Price and Upfront Fees and Costs Summary set out in Division 1 of Part 2 of Schedule 10;

(b) the Fees and Costs Summary set out in Division 3 of Part 2 of Schedule 10;

(c) the Example of Annual Fees and Costs set out in Division 5 of Part 2 of Schedule 10;

(d) the applicable Cost of Product Information set out in Division 6A of Part 2 of Schedule 10;

(e) the boxed Consumer Advisory Warning set out in Division 7A of Part 2 of Schedule 10; and

(f) the Additional Explanation of Fees and Costs set out in Division 8 of Part 2 of Schedule 10.

(3) The responsible entity for the scheme may replace any of the following defined words or expressions used in Part 2 of Schedule 10 with a corresponding word or expression used by the responsible entity in relation to the scheme:

(a) allocation points-based program;

(b) interval-based program;

(c) PAYG membership;

(d) PAYG points;

(e) PAYG points-based program;

(f) point;

(g) point-based program.”;

(2) omit Schedule 10 to the Regulations, substitute:

 

Schedule 10—Disclosure of Fees and Other Costs

(regulations 7.9.16K – 7.9.16O)

Part 1Interpretation

101 Definitions

In this Schedule:

accommodation usage fee means a fee or cost that a member of a registered time-sharing scheme may incur to use scheme accommodation in:

(a) the way that is disclosed in the Product Disclosure Statement for the scheme; or

(b) a way that a reasonable person would expect scheme accommodation could be used based on advertisements or other promotional material for the interest in the scheme;

but does not include a cost:

(c) that is prominently disclosed as an optional additional cost in a Product Disclosure Statement for the scheme; or

(d) that is paid or payable out of the levies for the scheme;

Example 1: Fees or costs for housekeeping or cleaning services that are usually charged to the member for accommodation bookings is an accommodation usage fee.

Example 2: The cost of membership of an exchange company that may be acquired if the member elects to become a member is not an accommodation usage fee.

allocation points-based program, in relation to a registered time-sharing scheme, means a points-based program where a person:

(a) becomes a member of the scheme by purchasing a specified number of points in relation to the scheme; and

(b) as a member of the scheme is entitled to be issued with a recurrent right to use scheme property in the form of a periodic allotment of points for:

(i) the duration of the scheme; or

(ii) a specified term of not less than 3 years.

budget means the estimated and itemised material expected income and expenditure for a scheme for a financial year or calendar year.

establishment fee means an amount paid or payable for the establishment of a person’s membership of a registered time-sharing scheme that is in addition to the purchase price for the interest in the scheme.

finance application fee means an amount paid or payable by an applicant to enter into a financing arrangement for an interest in a registered time-sharing scheme.

financing arrangement means an arrangement under which:

(a) financial accommodation is provided by a person in connection with an applicant’s acquisition of an interest in a registered time-sharing scheme; and

(b) the person who provides the financial accommodation is introduced to the applicant by the issuer or seller of the interest in the scheme or their associate.

fixed period, in relation to an interval-based program, means a specified period of time in a calendar year that is fixed for the same period each year.

floating period, in relation to an interval-based program, means a period of time between a range of dates.

Example:  A floating period during a specified season could allow members to request a booking for a week that falls within weeks 1–13 inclusive and weeks 40–52 inclusive.

high season, in relation to a registered time-sharing scheme, means that part of a year in which the accommodation provided by the scheme is typically in highest demand.

incidental fees means costs or amounts, other than accommodation usage fees, establishment fees, finance application fees, levies, ongoing financing costs and ongoing membership fees, that:

(a) are paid or payable in relation to an interest in a registered time-sharing scheme; and

(b) a reasonable person would consider are not material to a person’s decision to acquire, hold or dispose of an interest in the scheme.

Example: Direct debit dishonour fees.

interval-based program, in relation to a registered time-sharing scheme, means a scheme where members have the right to use property of the scheme for either a fixed period each calendar year or a floating period each calendar year.

Example:  An interval may be a week per calendar year.

levy, in relation to a registered time-sharing scheme, means an amount paid or payable by a member for

(a) the maintenance of scheme property;

(b) operating the scheme; and

(c) other services relating to the scheme.

ongoing financing costs means an amount paid or payable in relation to a financing arrangement, but excludes:

(a) any amount paid or payable as a result of the provider of the financing arrangement exercising their rights following an event of default or breach by the borrower under the financing arrangement; and

(b) the finance application fee.

ongoing membership fees means an amount required to be paid or payable by a member of a registered time-sharing scheme to the responsible entity or a nominee of the responsible entity as a requirement of being a member of the scheme and are not otherwise charged as levies.

PAYG membership, in relation to a registered time-sharing scheme, means a membership in a PAYG points-based program.

PAYG points, in relation to a registered time-sharing scheme, means pay-as-you-go points that:

(a) may only be purchased by a member of a PAYG points-based program; and

(b) may be used by the member to obtain the right to use property to which the scheme relates at the time the points are purchased.

PAYG points-based program, in relation to a registered time-sharing scheme, means a points-based program where a person:

(a) becomes a member of the scheme by purchasing a PAYG membership for a specified term of not less than 3 years; and

(b) as a PAYG member of the scheme is entitled to purchase PAYG points for the duration of that term.

point, in relation to a registered time-sharing scheme, means a unit of measurement of the amount payable for the use of the property to which the scheme relates.

points-based program, in relation to a registered time-sharing scheme, means a program where members of the scheme can use points to obtain the right to use property to which the scheme relates.

purchase price means the price paid to acquire an interest in a registered time-sharing scheme.

registered time-sharing scheme means a time-sharing scheme:

(a) registered in accordance with section 601ED of the Act; and

(b) that has not at any time been promoted by its operator as a means of generating a financial return other than by way of a rental pool.

rental pool, in relation to a time-sharing scheme, means an arrangement conducted by the operator of the scheme where members of the scheme authorise the operator to manage and rent to third parties the rights to use property under the scheme and to pool the rental income received for pro-rata distribution to each holder.

 

Part 2—Product Disclosure Statements: Fees and Costs Summaries, Additional Explanation of Fees and Costs, and Consumer Advisory Warning

Division 1—The Purchase Price and Upfront Fees and Costs Summary

201 Allocation points-based programs

What do you have to pay upfront?

Membership in an allocation points-based program entitles you to an [insert timeframe] allocation of points to use to stay at scheme accommodation. You can find information about the key features of different membership options and expiry dates of points at [insert page number(s)].

The table below shows the purchase price and upfront fees and costs to become a member for each membership option.

[If relevant] The table also shows the upfront fees you will be charged if you choose to enter into a financing arrangement facilitated by the responsible entity. You may choose to obtain your own financing which is subject to fees and costs not disclosed in this table.

Purchase Price and Upfront Fees and Costs Summary

Membership option

Purchase price (incl. fees)

[Insert column if relevant] Additional amounts under financing arrangement2

Points

Price per point

Total cost of points (incl. fees)1

Upfront finance costs

Total cost of points (incl. upfront finance costs)

[Insert membership option(s)]

 

 

 

 

 

1 This includes an establishment fee of [insert amount]. The proceeds from the purchase price will be paid to [insert details of payee(s)]. For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)]. For information on the current price of purchasing additional points once you are a member, see [insert page number(s)].

2  [Insert this paragraph if relevant] The Additional amounts under financing arrangement includes an establishment fee of [insert amount], [insert name of any other fee and amount] and finance application fee of [insert amount] if you choose to enter into a financing arrangement facilitated by the responsible entity. For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)].

Accommodation Example

The following Accommodation Example is provided to help you understand how many points are required to stay at our most popular accommodation choice for one week during high season for our most popular membership option.

Accommodation Example

Membership option

[Insert most common membership option]

Accommodation

[Insert description of most popular accommodation, including details of the resort location and room type]

Period of stay

[Insert dates]

Points required

[Insert number of points] points to secure accommodation for that stay

Note: This example is for illustrative purposes only and there is no guarantee that specific accommodation will be available for the dates used in the example. The number of points you will need to stay at particular scheme accommodation will depend on many factors including the location, facilities, duration of stay, time of year and the days of the week of a stay. You can find a full list of the number and value of points needed for each accommodation choice at [insert cross-reference to location of this information].You can find information about the key features of different membership options and expiry dates of points at [insert page number(s)].

202 PAYG points-based programs

What do you have to pay upfront for PAYG membership and to buy PAYG points?

[Insert membership option name] membership is a PAYG membership. Under this membership option you will need to pay the upfront PAYG membership cost and then buy PAYG points each time you want to stay at scheme accommodation for a specified term.

The Purchase Price and Upfront Fees and Costs Summary table below shows how many PAYG points are currently required under each of the PAYG membership options and how much this will cost to secure the following Accommodation Example.

Accommodation Example

Accommodation

[Insert description of most popular accommodation, including details of the resort location and room type]

Period of stay

[Insert dates]

PAYG points required

[Insert number]

Note: The Accommodation Example is used in the Purchase Price and Upfront Fees and Costs Summary below to help you understand what it will cost you to stay at our most popular accommodation choice for one week during the high season using [insert membership option name].

[Insert this paragraph if relevant] The table also shows you the upfront fees if you choose to enter into a financing arrangement facilitated by the responsible entity. You may choose to obtain your own financing which is subject to fees and costs not disclosed in this table.

You can find information about the key features of different membership options at [insert page number].

Purchase Price and Upfront Fees and Costs Summary

Membership option

Total purchase price
(incl. fees)1

 

[Insert column if relevant] Additional amounts under financing arrangement2

Purchase price of PAYG points for Accommodation Example under each membership option3

Upfront finance costs

Total cost of points (incl. upfront finance costs)

PAYG points needed

Price per PAYG point

Total cost of PAYG points

[Insert membership option(s)]

 

 

 

 

 

 

1 This includes an establishment fee of [insert amount]. The proceeds from the purchase price will be paid to [insert details of payee]. For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)].

2 [Insert paragraph if relevant] The Additional amounts under financing arrangement includes an establishment fee of [insert amount], [insert name of any other fee and amount] and finance application fee of [insert amount] if you choose to enter into a financing arrangement facilitated by the responsible entity. For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)].

3 The Accommodation Example used in this table is set out above and is provided to help you understand what it will cost you to stay at our most popular accommodation choice for one week during the high season for each PAYG membership option. This example is for illustrative purposes only and there is no guarantee that specific accommodation will be available for the dates used in the example. The number of PAYG points you will need to buy to stay at particular scheme accommodation might depend on many factors including the location, facilities, duration of stay, time of year and the days of the week of a stay. You can find a full list of the number and value of PAYG points currently needed for each accommodation choice at [insert cross-reference to location of this information].

203 Interval-based programs

What do you have to pay upfront?

This table shows you the cost to purchase a membership in the scheme for a fixed period or a floating period.

[Insert paragraph if relevant] The table also shows the upfront fees you will be charged if you choose to enter into a financing arrangement facilitated by the responsible entity. You may choose to obtain your own financing which is subject to costs not disclosed in this table.

Purchase Price and Upfront Fees and Costs Summary

Period (week number(s) of calendar year)

Interval (range of dates)

Purchase price (incl. upfront fees)1

[Insert column if relevant] Additional amounts under financing arrangement2

Upfront finance costs

Total cost of membership (incl. upfront finance costs)

[Insert period(s)]

 

 

 

 

1 This includes an establishment fee of [insert amount]. The proceeds from the purchase price will be paid to [insert details of payee]. For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)].]

2  [Insert paragraph if relevant] The Additional amounts under financing arrangement includes an establishment fee of [insert amount], [insert name of any other fee and amount] and finance application fee of [insert amount] if you choose to enter into a financing arrangement facilitated by the responsible entity. For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)]

Division 2—How to fill in the Purchase Price and Upfront Fees and Costs Summary

204 The preamble

The material in the preamble to the template should only include matters that are relevant to the interest or class of interest offered under the Product Disclosure Statement.

Example 1: If an interval-based program is for a fixed period, remove references to floating periods.

Example 2: If a points-based program does not offer different membership options, remove the reference to different membership options.

Example 3: If a financing arrangement is not offered, the preamble should be modified by removing references to financing.

205 Presentation of amounts

(1) This clause and clauses 206, 207, 208, 210, 212, 214, 216, 218, 221, 223, 224, 225, 226, 227, and 229 are subject to regulations 7.9.15A, 7.9.15B and 7.9.15C.

(2) If a particular fee or cost is not charged, nil, zero, 0 or not applicable (if it would not be misleading) must be written in the relevant column opposite the type of fee or cost.

(3) If it is not possible to determine a single amount or percentage of a fee or cost, it may be written as a range of fees or costs.

(4) If the exact amount of a fee or cost paid or payable is not known, an amount that is a reasonable estimate of the amount attributable to the retail client must be shown.

(5) Any estimate used must be clearly designated as an estimate.

(6) If an amount or cost has a number of components, the amount of each component must be listed separately, except the Cost of Product Information amount, which must be listed as a single amount.

Example: Levies: 1.8% of the value of members points + $70 per year.

(7) A cost or amount paid or payable must include (as applicable) gross of:

(a) income tax and GST, after being reduced by any reduced input tax credits;

(b) stamp duty; and

(c) without adjustment in relation to:

(i) any tax deduction available to the responsible entity; or

(ii)  the extent to which any tax deduction may be passed on to members.

206 Allocation points-based programs

(1) Column 1 of the template must set out each membership option offered under the Product Disclosure Statement in a separate row.

(2) Opposite each membership option described in column 1, column 2 must set out:

(a) in column 2 subcolumn 1—the points or range of points required;

(b) in column 2 subcolumn 2—the price of each point; and

(c) in column 2 subcolumn 3—the total cost of the points inclusive of the establishment fee and any other fees payable in relation to the purchase of points.

(3) If there is no financing arrangement offered, column 3 and footnote 2 should be removed.

(4) If a financing arrangement is offered, column 3 must set out opposite each membership option described in column 1:

(a) in column 3 subcolumn 1the total amount of any upfront finance costs related to obtaining finance facilitated by the responsible entity including any establishment fee, finance application fee and other fees payable in relation to the financing arrangement; and

(b) in column 3 sub column 2the sum of the amounts in column 2 sub column 3, and column 3 sub column 1.

207 PAYG points-based programs

(1) Column 1 of the template must set out each membership option offered under the Product Disclosure Statement in a separate row.

(2) Column 2 must set out opposite each membership option described in column 1, the total purchase price of that membership option inclusive of any establishment fee and other fees payable in relation to the purchase of points.

(3) If there is no financing arrangement offered, column 3 and footnote 2 should be removed.

(4) If a financing arrangement is offered, column 3 must set out opposite each membership option described in column 1:

(a) in column 3 subcolumn 1—any upfront finance costs related to obtaining finance including any establishment fee, finance application fee and other fees payable in relation to the financing arrangement; and

(b) in column 3 subcolumn 2—the sum of the amounts in column 2, and column 3 subcolumn 1.

(5) Column 4 must set out the following information for the Accommodation Example opposite each membership option described in column 1:

(a) in column 4 subcolumn 1—the number of PAYG points needed;

(b) in column 4 subcolumn 2—the price of each PAYG point; and

(c) in column 4 subcolumn 3—the total cost of the PAYG points.

208 Interval-based programs

(1) Column 1 of the template must set out the week number(s) of the calendar year offered under the Product Disclosure Statement in a separate row.

(2) Column 2 of the template must set out the range of dates during the calendar year corresponding to the week number(s) in column 1.

(3) Column 3 must set out opposite the week number(s) described in column 1, the total purchase price inclusive of the establishment fee or other fees payable in relation to the purchase.

(4) If there is no financing arrangement offered, column 4 and footnote 2 should be removed.

(5) If a financing arrangement is offered, column 4 must set out opposite the week(s) described in column 1:

(a) in column 4 subcolumn 1—any upfront finance costs related to obtaining finance including any establishment fee, finance application fee and other fees payable in relation to the financing arrangement; and

(b) in column 4 subcolumn 2—the sum of the amounts in column 3 and column 4, subcolumn 1.

209 Accommodation example—points-based programs

(1) An accommodation example must be included for points-based programs.

(2) For an allocation points-based program, the accommodation example used must be the accommodation choice and week during the high season that was in the highest demand for members of the most common membership option in the 12-month period before the date of the Product Disclosure Statement.

(3) For a PAYG points-based program, the accommodation example used must be the accommodation choice and week during the high season that was in the highest demand for members of the PAYG points-program in the 12-month period before the date of the Product Disclosure Statement.

(4) If, at the date of the Product Disclosure Statement, no interests have been issued or sold to persons that are not associated with the responsible entity, the membership option must represent the membership option which the responsible entity reasonably believes will be the most common, and use an accommodation choice the responsible entity reasonably believes that members would typically choose.

 

Division 3—The Fees and Costs Summary

210 Fees and Costs Summary

Fees and other costs

As well as the cost of buying a membership in a registered time-sharing scheme, all members must pay levies and other ongoing fees and costs. You have to pay fees and costs even if you do not use your membership.

The table shows fees and costs that you may be charged for [insert membership option] which is the membership option held by the greatest number of members. Taxes are set out in another part of this document.

[Insert if relevant] Note: The cost of buying PAYG points needed to secure accommodation under the scheme is a separate cost and is not included in this table. The cost of PAYG points is shown at [insert cross-reference to Purchase Price and Upfront Fees and Costs Summary].

Some fees and costs such as transfer fees and forfeiture fees may be charged if these circumstances arise.

[Insert if relevant] The table includes the financing costs if you choose to enter into a financing arrangement facilitated by the responsible entity. The exact amount of financing costs will depend on your particular circumstances and will be disclosed separately by the person providing the financial accommodation. You may choose to obtain your own financing which is subject to fees and costs not disclosed in this table.

You should read all the information about fees and costs because it is important to understand the costs of your membership.

Fees and Costs Summary – [insert membership option]

Type of fee or cost1

Amount

How and when paid

Ongoing annual fees and costs (excluding special levies2)

Levies

Fees to cover the budgeted costs of maintaining the property of the time-sharing scheme, managing the scheme and other services

[Insert if relevant] See description below “How annual levies are calculated” for the specific amount payable.

 

 

Ongoing membership fee

Fees payable for being a member

 

 

[Insert any other annual fees and costs items]

 

 

[Insert if relevant] Financing related fees and costs

Annual repayments for financing arrangements

Based on borrowing the maximum portion of the total purchase price available at the maximum interest rate for the maximum loan term in relation to that interest rate.

 

 

Ongoing financing costs

The financing costs you have to pay on an ongoing basis in addition to your repayments

 

 

[Insert any other finance related fee or costs items]

 

 

Member activity related fees and costs3

Accommodation usage fees4

Fees payable to use accommodation

 

 

Forfeiture fee5

Fees payable if the responsible entity forfeits your timeshare

 

 

Transfer fee

Fees payable to transfer your membership

 

 

[Insert if relevant]

PAYG purchase fee

Fees payable when you purchase PAYG points

 

 

[Insert any other fee or cost items]

 

 

 

1 It is important to understand that a failure to pay an amount owing (such as levies or financing costs) may result in you losing your membership, by forfeiting your interest in the scheme. You may not receive anything for the forfeited interest if this happens.

2 Special levies may also be payable in certain circumstances. For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)].

3 One-off fees and costs may also be payable in certain circumstances—for example, if your timeshare is forfeited or transferred. [If there are other fees and costs, such as direct debit dishonour fees, include these.] For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)].

4 [Insert a description of the accommodation usage fees] For further information, refer to the Additional Explanation of Fees and Costs at [insert page(s)].

5 Refer to section [insert section reference] of the Product Disclosure Statement for details of the circumstances where the responsible entity can forfeit a membership.

[Insert if relevant] How annual levies are calculated

[Insert if relevant] Annual levies
 

Membership option

Amount

How levies are calculated

 

 

 

 

Division 4—How to fill in the Fees and Costs Summary

211 If there are no levies payable

If there are no levies payable, remove:

(a) in the preamble, all references to levies;

(b) in the Fees and Costs Summary table, the words “See description below “How annual levies are calculated” for the specific amount payable”;

(c) the heading “How annual levies are calculated” and the accompanying Annual levies table.

212 If there are levies payable

(1) Levies include amounts payable on a periodic and one-off basis (excluding special levies).

(2) If there are levies payable:

(a) in the Fees and Costs Summary table:

(i) the Amount and How and when paid columns must be based on the membership option held by the greatest number of members;

(ii) column 2 must set out the amount of the annual levy for the membership option;

(iii) if it is not possible to determine a single amount for the levies or a single number of points, column 2 must set out a range of amounts.

(b) in the Annual levies table:

(i) column 1 must set out the membership options available;

(ii) if the same levies are charged for all membership options, column 1 must state “All membership options”;

(iii) column 2 must set out the levy or range of levies payable opposite the membership option(s) described in column 1;

(iv) column 3 must set out opposite the membership option(s) described in column 1, the levies payable and how they are calculated.

Example 1: The levy is your share of the total amount of levies budgeted to be raised based on the number of points and type of membership you have. For the first year of membership, the pro-rata proportion of the levy which relates to the remaining period of that calendar year will be due on 1 January of the following year.

Example 2: A budget is calculated for the upcoming calendar year and divided into the number of weeks in the year. Members pay in proportion to the number of weeks their membership entitles them to use.

213 If there is no financing arrangement

If there is no financing arrangement offered, remove:

(a) in the preamble, references to financing; and

(b) in the Fees and Costs Summary table, the heading “Financing related fees and costs” and the information under that heading.

214 If there is a financing arrangement

If there is a financing arrangement offered, the amounts shown in the Amounts column in relation to financing fees and costs must be calculated on the basis of:

(a) borrowing the maximum portion of the total purchase price available;

(b) the maximum interest rate (where there is a range);

(c) the maximum loan term in relation to the interest rate specified in paragraph (b).

215 Accommodation Usage Fee

The accommodation usage fee is the amount the responsible entity knows or ought reasonably to know will be incurred:

(a) for points-based programsbased on the assumption that the member is a member of the most popular membership option and fully utilises all their points or purchases PAYG points to book at the most popular accommodation option in high season making bookings for at least one period during high season; and

(b) for an interval programbased on the most expensive interval.

216 Column 3 – How and when fees and costs are paid

Column 3 of the Fees and Costs Summary table must set out:

(a) how the amount is or will be incurred by a member; and

(b) when and how regularly the amounts will be incurred by a member.

217 Other material to be included in the summary—fees that are negotiable

(1)          The Fees and Costs Summary table must clearly indicate which fees are negotiable (for example, by stating in column 3 “The amount of this fee can be negotiated.”).

(2)          An indication that a fee or cost is negotiable must be cross-referenced to an explanation in the “Additional Explanation of Fees and Costs” part of the fees section of the Product Disclosure Statement.

 

Division 5 – Example of Annual Fees and Costs

218 Example of Annual Fees and Costs

Example of annual fees and costs

[Insert for an allocation and PAYG points-based programs] This table gives an example of the annual fees and costs if you hold and use a [insert membership option] over a 1-year period. You should use this table to compare this product with other time-sharing schemes.

[Insert for an interval-based scheme] This table shows how much you could be paying if you use a membership to provide a week of accommodation—with and without the option of finance. You should use this table to compare this product with other time-sharing schemes.

The table below is only an example and does not reflect the actual costs you will have to pay each year. The example does not take into account any increase in levies or increases in other ongoing costs that may occur. The responsible entity can increase the cost of levies by [insert percentage amount and timeframe]. You will have to pay these levies and ongoing costs every year of your membership, even if you do not use your membership.

[Insert if relevant] If financing is facilitated, the estimate assumes you borrowed the maximum portion of the total purchase price available at the maximum interest rate for the maximum loan term for that interest rate. Financing is at the discretion of the person providing the financial accommodation and may not be available.

If you do not pay the costs associated with holding your membership your interests may be forfeited and you may also be charged forfeiture fees of between $0 and $[insert amount].

 

Membership Option – [insert name of membership option or interval required by clause 222 and the number and type of points or intervals used for the example]

 

Type of fee or cost1

Amount

Explanation of fees and costs

Cost of membership —before [if relevant - the purchase of PAYG points and] finance

Levies

 

[Insert an explanation of levies]

Ongoing membership fee

 

[Insert an explanation of ongoing membership fees]

Special levies [if relevant]

 

[Insert an explanation of any special levies]

Other annual fees and costs

[Insert a breakdown of the ongoing fees and costs]

 

[Insert an explanation of the other annual fees and costs]

Accommodation usage fees

[Insert a breakdown of the accommodation usage fees]

 

Assumes membership is fully utilised and bookings are made in high season.

[Insert an explanation of accommodation usage fees]

Other fees and costs

[Insert a breakdown of the other fees and costs]

 

[Insert an explanation of other fees and costs]

Total of the above costs of [insert name of membership option].

Not including [if relevant, the cost of purchasing any PAYG points or] finance costs.

 

If you held this membership option, you would be charged fees and costs of $[insert amount from column 2] for a 1-year period.

This amount does not include [if relevant, the cost of purchasing any PAYG points or] finance costs.

[If relevant] PAYG costs

[If relevant]

PLUS Cost of PAYG points2

 

[Insert an explanation of the costs to purchase PAYG points.]

[If relevant]

PLUS Fees and costs for purchase of PAYG points2

 

[Insert an explanation of any fees and costs associated with the purchase of PAYG points.]

[If relevant]

Total of all the above costs of [insert name of membership option]

including the cost of purchasing PAYG points

not including finance costs.

 

[If relevant]

If you held this membership option, you would be charged fees and costs of $[insert amount from column 2] for a 1-year period

including the cost of purchasing PAYG points

not including finance costs.

Finance costs

Annual repayments for financing arrangements3

 

[Insert an explanation of annual repayments under financing arrangements]

Ongoing financing costs

[Insert a breakdown of ongoing financing costs]

 

[Insert an explanation of ongoing costs]

Total of all the above costs of [insert name of membership option],

including [if relevant, the cost of purchasing PAYG points and] finance costs.

 

If you held this membership option, you would be charged fees and costs of $[insert amount from column 2] for a 1-year period

including [if relevant, the cost of purchasing PAYG points and] finance costs.

1 Additional fees may apply

2 [If relevant] You need to buy PAYG points each time you want to stay at scheme accommodation. This example assumes that you purchase the number of PAYG points required under the membership option to stay at the most popular scheme accommodation for one week during high season.

3 The interest rate in the example is based on borrowing the maximum portion of the total purchase price available at the maximum interest rate available under a financing arrangement and the maximum loan term in relation to that interest rate. It assumes the amount borrowed is the maximum portion of the purchase price able to be financed. The interest rate is [insert percentage] p.a., loan term is [insert timeframe] years and amount borrowed is [insert amount]. The annual repayments during the loan include interest and the amount contributed towards the purchase price.

 

Division 6—How to fill in the Example of Annual Fees and Costs

219 Example of Annual Fees and Costs

The Example of Annual Fees and Costs must:

(a) contain fees and costs in accordance with the table in clause 218;

(b) be set out using the headings and the form in clause 218; and

(c) be included in the fees section of a Product Disclosure Statement, following the Fees and Costs Summary.

220 If there is no financing arrangement

If there is no financing arrangement offered, remove:

(a) in the preamble, references to financing;

(b) in the table:

(i) the subheadingFinance costs” and the information under this subheading; and

(ii) any other references to financing; and

(c) footnote 3 to the table.

221 If there is a financing arrangement

If there is a financing arrangement offered:

(a) the interest rate in the example must be based on the maximum portion of the total purchase price available at the maximum interest rate available under a financing arrangement and the maximum loan term in relation to that interest rate offered, at the date of the Product Disclosure Statement; and

(b) the loan amount, interest rate and loan term must be set out in footnote 3 to the table.

222 Membership option

(1) For allocation points-based and PAYG points-based programs:

(a) the membership option must be the most common membership option purchased at the date of the Product Disclosure Statement; and

(b) if, at the date of the Product Disclosure Statement, no interests have been purchased by persons that are not associated with the responsible entitythe membership option must represent the membership option which the responsible entity reasonably believes will be the most common.

(2) For interval-based programs:

(a) the example of the week must be based on the interval purchased by the greatest number of persons not associated with the responsible entity during the 12-month period before the date of the Product Disclosure Statement;

(b) if no such purchases occurred during the 11-month period before the date of the Product Disclosure Statementthe example must be based on the interval owned by the greatest number of members who are not associated with the responsible entity; and

(c) if the responsible entity or its associates are the only members of the schemethe example must be based on the interval the responsible entity reasonably expects will be purchased by the greatest number of persons not associated with the responsible entity.

223 Column 2 – Amounts

(1) If a range of annual fees and costs may be charged, the example must use the highest amount in that range.

(2) In relation to levies, the example must be based on the levies for the year in which the Product Disclosure Statement is dated.

Division 6A – Cost of Product Information

224 Allocation points-based programs

Cost of product for 1 year

The cost of product information gives a summary calculation of the cost of each membership option over a 1-year period. It is calculated using the same method as the Example of Annual Fees and Costs.

The cost of product information assumes you hold the number of points most commonly held in the membership option for the 1-year period.

You should use this figure to help compare this product and membership options with other time-sharing schemes and membership options.

Membership option

Cost without finance

Cost with finance

[Insert membership option]

$[ ]

$[ ]

 

225 PAYG points-based programs

Cost of product for 1 year

The cost of product information gives a summary calculation of the cost of each membership option over a 1-year period. It is calculated using the same method as the Example of Annual Fees and Costs.

The cost of product information assumes you hold the number of points most commonly held in the membership option for the 1-year period and that you purchase the maximum number of points required under the membership option to stay at the most popular scheme accommodation for one week during high season.

You should use this figure to help compare this product and membership options with other time-sharing schemes and membership options.

Membership option

Cost without finance

Cost with finance

[Insert membership option]

$[ ]

$[ ]

 

226 Interval-based programs

Cost of product for 1 year

The cost of product information gives a summary calculation of the cost of each fixed or floating period membership option over a 1-year period. It is calculated using the same method as the Example of Annual Fees and Costs.

The cost of product information assumes you have a membership entitling you to a week of accommodation during a 1-year period.

You should use this figure to help compare this product and membership options with other time-sharing schemes and membership options.

Membership option

Cost without finance

Cost with finance

[Insert membership option]

$[ ]

$[ ]

 

Division 6B – How to fill in the Cost of Product Information

227 Cost of Product Information

(1) The Cost of Product Information must:

(a) be included in the fees section of the Product Disclosure Statement, following the Example of Annual Fees and Costs;

(b) be set out using the headings and the form and contain fees and costs in accordance with the table in:

(i) clause 224 for allocation points-based programs;

(ii) clause 225 for PAYG points-based programs;

(iii) clause 226 for interval-based programs;

(c) set out each membership option offered under the Product Disclosure Statement in a separate row in the table;

(d) be calculated in accordance with the methods set out in the Example of Annual Fees and Costs.

(2) If interests in more than one program are offered under the Product Disclosure Statement (for example an allocation points-based program and a PAYG points-based program), the Product Disclosure Statement must contain a Cost of Product Information for each program.

(3) The Cost of Product Information is not required to be included in a Product Disclosure Statement if only one membership option is available under the Product Disclosure Statement and that membership option is included in the Product Disclosure Statement in the Example of Annual Fees and Costs in accordance with Division 5.

 

Division 7A – Consumer Advisory Warning

228 Consumer Advisory Warning

 

Did you know?

Fees and costs can have a substantial impact on your ability to use your membership.

You should consider whether you can afford any ongoing fees and costs before becoming a Member to make sure you can afford to use your timeshare membership.

Fees [insert as applicable are/are not] negotiable.

TO FIND OUT MORE

If you would like to find out more, refer to the Australian Securities and Investments Commission (ASIC) website (www.moneysmart.gov.au).

 

 

229 Where to place the Consumer Advisory Warning

The Consumer Advisory Warning must be located at the beginning of the fees section of the Product Disclosure Statement.

 

Division 8 — Additional Explanation of Fees and Costs

230 Matters to be included

The following information must be included under the heading “Additional Explanation of Fees and Costs if it is relevant to the interests in the scheme offered under the Product Disclosure Statement:

Levies

(a) information about annual, special and any other kind of levies, including:

(i) the types of costs and expenses covered by each type of levy;

(ii) any interest or fees charged for late payment of levies;

(iii) what happens when a member does not pay levies by the due date;

(iv) when annual levies will be invoiced;

(v) if a special or other levy is proposed or reasonably anticipated to be charged in the futurean explanation of the purpose of the levy and the key assumptions underlying the purpose, and the anticipated or proposed date of invoicing;

(vi) a description of the circumstances in which any special and other levies can be charged, and how they would be calculated;

(vii) the total amount of all levies other than annual levies, invoiced for each year of the 3-year period before the date of the Product Disclosure Statement, with an explanation of their purpose;

(viii) if applicable, a statement about the responsible entity’s power to vary levies; and

(ix) how to obtain a copy of the scheme’s annual budget;

Suspension and forfeiture for non-payment

(b) information about suspension and forfeiture of a membership interest due to failure to pay levies or failure to pay other fees or costs, including any fees or costs that may be incurred in selling a forfeited membership that will be payable from the proceeds received from the sale of the forfeited membership;


Management fees

(c) information about the amount payable to the responsible entity or any delegate or associate of the responsible entity for managing the scheme, including:

(i) for allocation points-based and interval-based programsthe amount stated as a percentage of the annual operating budget of the scheme, with a worked example showing the amount in dollars per year for the membership option used in the Example of Annual Fees and Costs;

(ii) for a PAYG points-based programdetails of how the amount is determined;

Application of purchase price monies

(d) information about how the purchase price is applied including any arrangements with and payments to an associate of the responsible entity;

Changes to fees and costs

(e) the following information about changes to the fees and costs, if applicable:

(i) information about the responsible entity’s right to vary the amount of the fees without the member’s consent;

(ii) any indexation arrangements that apply to fees and costs;

(iii) the period of advance notice to members required for variations to fees and costs; and

(iv) any limits on changes to fees and costs contained in the scheme’s constitution, and when those limits apply;

Other kinds of fees

(f) information about accommodation usage fees;

(g) information about fees for any additional services;

(h) information about any incidental fees;

(i) information about where to find details of the fees and costs of any optional programs offered to members;

(j) information about fees to transfer a membership;

Fees mentioned in the Summary tables

(k) the explanation of the fees mentioned in:

(i) footnotes 1 and 2 to the Purchase Price and Upfront Fees and Costs Summary table; and

(ii) footnotes 2, 3 and 4 to the Fees and Costs Summary table;

Tax

(l) a cross reference to the tax section of the Product Disclosure Statement;

(m) if the interest in the scheme is subject to tax—whether the benefit of any tax deduction is passed onto the member in the form of a reduced fee or cost;

Adviser remuneration

(n) an explanation of any adviser remuneration (including commissions) that forms part of any fee or cost in the Fees and Costs Summary table, including (if known to the responsible entity):

(i) the method of calculation of the remuneration;

(ii) the amounts or range of amounts;

(iii) whether the amounts are negotiable or rebatable; and

(iv) the way in which amounts may be negotiated or rebated;

Negotiable fees and flexible charging structures

(o) for fee or cost that is negotiablecontact details of the person or body with whom the fee or cost can be negotiated and the manner of negotiation;

(p) if the issuer has instituted a flexible charging structure—for each applicable fee, if known:

(i) any maximum, and when it would apply; and

(ii) any waiver, and when it would not apply;


Worked examples

(q) worked examples (if appropriate).


Part 3—Fees and costs in periodic statements

Division 1Fees and costs

301 Total Fees and Costs

(1) The following text and the appropriate amounts, in dollars, must be displayed in a summary part of the periodic statement.

Total fees and costs you paid

$[insert relevant amount for member]

This amount includes all fees and costs of your membership during the period, excluding any fees and costs related to any financing arrangement.

(2) The total fees and costs you paid is the total of all the fees and costs disclosed in the periodic statement.

(3) The amount must be shown as a single total amount in dollars.

(4) For an interest in the scheme that is subject to tax—if a reduced fee or cost is disclosed in the periodic statement because of the benefit of any tax deduction, the fees and costs charged must include the part of the cost that reduced the disclosed fee or cost.

(5) Fees and costs associated with a financing arrangement obtained by the member to acquire their membership or PAYG points are not required to be disclosed in the periodic statement.

 


Division 2—Additional Explanations of Fees and Costs

302 Matters to be included

The following information must be included in the periodic statement under the heading “Additional explanation of fees and costs”, if it has not been included in another part of the periodic statement:

(a) details of incidental fees, such as cheque dishonour fees, that were incurred by the member during the period;

(b) details of any service fees that may have been incurred by the member during the period;

(c) where the member’s interest is sold as a result of forfeiture or hardship withdrawaldetails of any amounts deducted from the proceeds of the sale; and

(c) for an interest in the scheme that is subject to taxwhether the benefit of any tax deduction has been passed onto the member in the form of a reduced fee or cost.

 

Part 4Transitional

9 Rental pools covered by ASIC Class Order [CO 02/237]

(1) Subsections (2) and (3) apply in relation to a person that operates or provides financial services in relation to an interest in a rental pool that was operated or purportedly was operated in reliance on ASIC Class Order [CO 02/237] (the old class order) immediately before the repeal of that class order.

(2) The old class order as in force immediately before its repeal continues to apply to the person despite its repeal as if the following amendments were made:

(a) in the First Exemption at subparagraph 1(e) omit “once every 6 months”, and substitute “annually”;

(b) in the Second Exemption at paragraph (b) omitonce every 6 months”, and substitute “annually”.

(3) The exemption (including any related conditions and as affected by subsection (2)) in the old class from the requirement to hold an Australian financial services licence that is expressed to be made under paragraph 911A(2)(l) has effect under section 926A of the Act instead.

10 Application of amendments made by Corporations (Amendment) Instrument 2020/1064

(1) The amendments made by Schedule 1 to the ASIC Corporations (Amendment) Instrument 2020/1064 (amending instrument) apply on and from commencement of the amending instrument.

(2) The amendments made by Schedule 2 to the amending instrument apply on and from commencement of the amending instrument in relation to a registered time-sharing scheme that was being not operated immediately before the commencement of the amending instrument.

Note: Until the amendments made by Schedule 2 of the amending instrument apply in relation to a scheme, among other matters, the provisions of this instrument that were in force immediately before commencement of the amending instrument and that are omitted by those amendments will continue to apply in relation to the scheme.

(3) The amendments made by Schedule 2 to the amending instrument apply, in relation to a registered time-sharing scheme that was being operated immediately before the commencement of the amending instrument, on and from the first to occur of:

(a) the constitution of the scheme being modified or repealed and replaced so that it includes provisions (hardship provisions) to the effect of paragraphs 601GA(1A)(a) to (l) of the Act (as notionally inserted or to be notionally inserted into the Act as a result of the amending instrument);

(b) unless subsection (4) applies in relation to the scheme—30 September 2021.

(4) This subsection applies in relation to a registered time-sharing scheme that was being operated immediately before the commencement of the amending instrument if either of the following apply:

(a) the responsible entity decides that it would not be in the best interest of members of the scheme for the constitution of the scheme to be modified or repealed and replaced to include the hardship provisions and notifies members of that decision on or before 30 September 2021;

(b) on or before 30 September 2021, members of the scheme vote on, but do not pass, a special resolution to modify or repeal and replace the constitution to include the hardship provisions.

(5) The amendments made by Schedule 3 to the amending instrument apply in relation to a registered time-sharing scheme on and from the first to occur of:

(a) the amendments made by Schedule 2 to the amending instrument applying in relation to the scheme;

(b) 30 September 2021.

11 Disclosure of fees and costs—application to Product Disclosure Statements

(1) The declaration in section 8C of this instrument applies to Product Disclosure Statements given on or after 30 September 2022.

Election by the responsible entity

(2) The responsible entity of a registered time-sharing scheme may, in accordance with subsection (3), elect to apply the declaration in section 8C of this instrument to a Product Disclosure Statement dated on or after 14 December 2020.

(3) The responsible entity elects to apply the declaration in section 8C of this instrument to a Product Disclosure Statement if the responsible entity makes a written record:

(a) that identifies the Product Disclosure Statements to which the election relates; and

(b) of the date or dates the election is made.

(4) If the responsible entity elects to apply the declaration in section 8C of this instrument to a Product Disclosure Statement for a financial product:

(a) the election is taken to also cover any subsequent Product Disclosure Statements for the financial product; and

(b) the declaration in section 8C of this instrument applies to the Product Disclosure Statement and any subsequent Product Disclosure Statements for the financial product.

(5) An election made under this section cannot be withdrawn.

12 Disclosure of fees and costs—application to periodic statements

(1) The declaration in section 8C of this instrument applies to periodic statements for reporting periods commencing on or after 30 September 2021.

Election by the responsible entity

(2) The responsible entity of a registered time-sharing scheme may, in accordance with subsection (3), elect to apply the declaration in section 8C of this instrument to a periodic statement for a reporting period (an earlier reporting period) that:

(a) commences on or after 14 December 2020; or

(b) ends on a day (the exit date) that is on or after 14 December 2020 if the reporting period ends on the exit date because the holder of the product ceased to hold the product on the exit date.

(3) The responsible entity elects to apply the declaration in section 8C of this instrument to a periodic statement for an earlier reporting period if the responsible entity makes a written record of:

(a) the financial products to which the election relates;

(b) the reporting periods to which the election relates; and

(c) the date or dates the election is made.

(4) If the responsible entity elects to apply the declaration in section 8C of this instrument to a periodic statement for an earlier reporting period:

(a) the election is taken to also cover any periodic statements for any subsequent reporting periods; and

(b) the declaration in section 8C of this instrument applies to the periodic statement and any periodic statements for any subsequent reporting periods.

(5) An election made under this section cannot be withdrawn.

13 Disclosure of fees and costs—transitional exemption from ongoing disclosure of material changes and significant events

(1) A responsible entity of a registered time-sharing scheme does not have to comply with subsection 1017B(1) of the Act to the extent section 8C of this instrument directly results in a change or event that, but for this section, would be required to be notified under that subsection of the Act.

(2) The exemption in this section only applies in relation to the first time the responsible entity makes changes to a Product Disclosure Statement as a direct result of section 8C of this instrument.

 

Endnotes

Endnote 1—Instrument history

Instrument number

Date of FRL registration

Date of commencement

Application, saving or transitional provisions

2017/272

27/3/2017 (see F2017L00315)

28/3/2017

 

2020/1064

11/12/2020 (see F2020L01571)

12/12/2020

-

2020/1065

11/12/2020 (see F2020L01572)

12/12/2020

-

Endnote 2—Amendment history

ad. = added or inserted     am. = amended     LA = Legislation Act 2003    rep. = repealed     rs. = repealed and substituted

Provision affected 

How affected

Section 2

rep. s48D LA

Section 4

rs. 2020/1064

am. 2020/1065

Section 5

rs. 2020/1064

Section 5A

ad. 2020/1064

Section 7

rs. 2020/1064

Section 7A

ad. 2020/1064

Section 8A

ad. 2020/1064

Section 8B

ad. 2020/1064

Section 8C

ad. 2020/1065

Section 9

rs. 2020/1064

Section 10

ad. 2020/1064

Section 11

ad. 2020/1065

Section 12

ad. 2020/1065

Section 13

ad. 2020/1065