Implementation of shorter PDS regime
The shorter PDS disclosure regime commenced on 22 June 2012.
Further amendments to the regulations with regards to platform products and multi-funds are proposed by the Government. On an interim basis, superannuation platforms, hedge funds and multi-funds have been excluded from the shorter PDS regime: see 12-131MR Shorter PDS regime guidance and relief and 12-306MR ASIC extends shorter PDS regime release.
The relief for superannuation platforms, multi-funds and hedge funds now runs until 22 June 2014. The initial relief was due to expire on 22 June 2013.
The relief in Class Order [CO 12/749] Relief from the Shorter PDS regime and Class Order [CO 12/1592] means that issuers of these products will remain subject to the disclosure provisions under Chapter 7 of the Corporations Act 2011.
This relief is for an interim period only pending a future Government decision on the appropriate regulation of these products.
ASIC has also issued further guidance in relation to shorter PDSs in Information Sheet 155 Shorter PDSs: Complying with requirements for superannuation products and simple managed investment schemes (INFO 155). This guidance focuses on superannuation queries received by ASIC relating to employer PDSs, incorporation by reference, the proposed Stronger Super reforms and ASIC's expectations with regards to the use of the Standard Risk Measure (SRM) developed by the Association of Superannuation Funds of Australia (ASFA) and the Financial Services Council (FSC).
The SRM discloses the level of risk in superannuation and provides consumers with greater transparency about the risks associated with their investment choices in superannuation. Funds will need to disclose the risk of a negative return in a twenty year period for each investment option: see ASIC's 11-156MR in support of the guidelines released by ASFA and the FSC. A copy of the guidelines is available from the ASFA website.
Earlier guidance in relation to shorter PDSs is available in Information Sheet 133 Shorter PDS regime: Superannuation, managed investment schemes and margin lending (INFO 133). This infosheet provides concise guidance for industry on technical issues related to implementation of the new shorter PDS regime.