Corporations Amendment Regulations 2008 (No. 3)1
Select Legislative Instrument 2008 No. 130
I, PHILIP MICHAEL JEFFERY, Governor‑General of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, make the following Regulations under the Corporations Act 2001.
Dated 24 June 2008
P. M. JEFFERY
Governor‑General
By His Excellency’s Command
CHRIS BOWEN
Assistant Treasurer
1              Name of Regulations
                These Regulations are the Corporations Amendment Regulations 2008 (No. 3).
2              Commencement
                These Regulations commence on 1 July 2008.
3              Amendment of Corporations Regulations 2001
                Schedule 1 amends the Corporations Regulations 2001.
Schedule 1        Amendments
(regulation 3)
  
[1]           After regulation 7.7.20
insert
7.7.20A  Extension of disclosure requirements to wholesale clients dealing with certain unauthorised insurers
         (1)   For paragraph 949B (1) (e) of the Act, a person must give a wholesale client the information set out in subregulation (3) for a financial service provided by that person to the wholesale client if:
                (a)    the service relates to an insurance contract specified in regulation 4C or 4D of the Insurance Regulations 2002 that may be offered or issued by an unauthorised foreign insurer (within the meaning of those Regulations) (the insurer); and
               (b)    either:
                          (i)    the person would be required to give a Statement of Advice if the service were provided to a retail client; or
                         (ii)    the contract is offered or issued to the wholesale client.
Note   Failure to comply with this subregulation is an offence punishable by a fine of up to 50 penalty units or imprisonment for 1 year, or both — see section 1311 and item 272A of Schedule 3 to the Corporations Act 2001.
         (2)   For paragraph 949B (1) (e) of the Act, a person must give a wholesale client the information set out in subregulation (3) for a financial service provided by that person to the wholesale client if:
                (a)    the service relates to the wholesale client dealing with an entity (the insurer) specified in regulation 12 of the Insurance Regulations 2002; and
               (b)    either:
                          (i)    the person would be required to give a Statement of Advice if the service were provided to a retail client; or
                         (ii)    the insurer offers or issues a financial product to the wholesale client.
Note   Failure to comply with this subregulation is an offence punishable by a fine of up to 50 penalty units or imprisonment for 1 year, or both — see section 1311 and item 272A of Schedule 3 to the Corporations Act 2001.
         (3)   The information is:
                (a)    a statement that the insurer is not authorised under the Insurance Act 1973 to conduct insurance business in Australia; and
               (b)    a statement that the insurer is not subject to the provisions of the Insurance Act 1973, which establishes a system of financial supervision of general insurers in Australia; and
                (c)    a statement that the wholesale client should consider whether to obtain further information, including:
                          (i)    the country in which the insurer is incorporated, and whether the country has a system of financial supervision of insurers; and
                         (ii)    the paid up capital of the insurer; and
                         (iii)    which country’s laws will determine disputes in relation to the financial product.
[2]           Part 7.9, after Division 2B
insert
Division 2BA         Product Disclosure Statement for discretionary mutual funds
7.9.07CA    Extension of Product Disclosure Statement requirements to wholesale clients
         (1)   For paragraph 949B (1) (e) of the Act, a regulated person must give a wholesale client a Product Disclosure Statement or a Supplementary Product Disclosure Statement for a financial product if:
                (a)    the financial product is offered or issued by a discretionary mutual fund (within the meaning given by subsections 5 (5) and (6) of the Financial Sector (Collection of Data) Act 2001); and
               (b)    the regulated person would be required to give the Statement if the product were offered or issued to a retail client.
         (2)   The Product Disclosure Statement or Supplementary Product Disclosure Statement required to be given under this regulation must be the same as that which would be given to a retail client.
Note   Failure to comply with this regulation is an offence punishable by a fine of up to 50 penalty units or imprisonment for 1 year, or both — see section 1311 and item 272A of Schedule 3 to the Corporations Act 2001.
Note
1.       All legislative instruments and compilations are registered on the Federal Register of Legislative Instruments kept under the Legislative Instruments Act 2003. See http://www.frli.gov.au.