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17-059MR ASIC releases new instrument for differential fees
Following public consultation, ASIC has released a new legislative instrument regarding differential fees, replacing the class order due to expire (‘sunset’) on 1 April 2017.
ASIC has replaced Class Order [CO 03/217] with the new legislative instrument ASIC Corporations (Registered Schemes - Differential Fees) Instrument 2017/40 that:
- expands the relief where a member acquires an investment under a switching facility that involved a withdrawal from a managed investment scheme operated by the responsible entity to also cover a switching facility that involves a withdrawal from a managed investment scheme operated by a related body corporate of the responsible entity; and
- removes unnecessary relief where a member carries out transactions in relation to the scheme by electronic means.
Class Order [CO 03/217] has been repealed by ASIC Corporations (Amendment and Repeal) Instrument 2017/41.
The new instrument follows a public consultation released on 30 May 2016. In Consultation Paper 258 Remaking ASIC class order on differential fees: [CO 03/217], ASIC sought feedback on its proposals to remake, without significant changes, Class Order [CO 03/217]. ASIC received one non-confidential and one confidential submission.
Submissions proposed some minor amendments to the draft version of ASIC Corporations (Registered Schemes - Differential Fees) Instrument 2017/40, attached to the consultation paper, which we have accepted. Both submissions generally supported extending relief to permit responsible entities to individually negotiate fees with retail clients. However, given the limited consultation feedback on this item and the lack of information about the impacts of this change, we decided not extended this relief at this stage by a legislative instrument but are open to further submissions. Submission comments also focused on whether relief for member that carry out transactions electronically should be retained - we did not consider this relief necessary – it would be open to all members equally to transact electronically.
Under the Legislation Act 2003, all class orders sunset after a specified period of time (mostly ten years) unless we take action to exempt or preserve them. This ensures that legislative instruments like class orders are kept up to date and only remain in force while they are fit for purpose and relevant.
All government organisations are responsible for considering whether the legislative instruments they have made that are due to sunset will be relevant after their sunset date.
- ASIC Corporations (Registered Schemes - Differential Fees) Instrument 2017/40
- ASIC Corporations (Registered Schemes - Differential Fees) Instrument 2017/40 Explanatory Statement
- ASIC Corporations (Amendment and Repeal) Instrument 2017/41
- Consultation Paper 258: Remaking ASIC class order on differential fees: [CO 03/217]
- 16-168 MR ASIC consults on 'sunsetting' class order about differential fees for registered managed investment schemes