Commonwealth legislation

ASIC Class Order [CO 04/1432]

RepealedCTH

This Act has been repealed and is no longer in force. It is retained for historical reference.

Jurisdiction

Commonwealth

Collection

legislative instrument

Plain English Summary

3/10 complexity

ASIC’s technical ruling clarifies that banks do not have to state a fixed dollar amount of interest in Product Disclosure Statements for accounts where interest varies with your balance. Instead, firms should explain how interest is calculated (e.g., daily on closing balance). This gives banks legal certainty for variable-interest deposit products and removes doubt about impossible future dollar estimates.

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Current sections

Direct links to the current provisions in ASIC Class Order [CO 04/1432].

ASIC Class Order [CO 04/1432]

Australian Securities and Investments Commission

Corporations Regulations 2001 — Subregulation 7.9.15B(1) — Determination

Under subregulation 7.9.15B(1) of the Corporations Regulations 2001 the Australian Securities and Investments Commission determines for the avoidance of doubt that it is not possible to state in a Product Disclosure Statement information to be disclosed in accordance with paragraph 1013D(1)(b) of the Corporations Act 2001 (the Act) as an amount in dollars where the information is the amount of interest payable to a holder of a deposit product and that amount is to be worked out by applying a percentage to the amount standing to the credit of the facility that is the deposit product from time to time.

Note: The application of this determination may be limited. In many circumstances, subsection 1013C(2) and section 1013F of the Act may have the effect that interest as an amount in dollars need not be disclosed in the Product Disclosure Statement. Nonetheless, in those cases, paragraph 1013D(1)(b) of the Act is likely to have the effect that a description of how interest is to be calculated must be included in the Statement.

Interpretation

In this instrument deposit product has the meaning given by section 761A of the Act.

Dated this 8th day of December 2004

Signed by Brendan Byrne

as a delegate of the Australian Securities and Investments Commission

Source text

Sourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.

1 ASIC Class Order [CO 04/1432]