Corporations Regulations 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

PART 7.7A - BEST INTERESTS OBLIGATIONS AND REMUNERATION  

Note: Regulations 7.7A.01 to 7.7A.04 are reserved for future use.

Division 4 - Conflicted remuneration  

Subdivision 2 - Monetary benefits that are not conflicted remuneration  

REGULATION 7.7A.12D   BROKERAGE FEES  

7.7A.12D(1)    
A monetary benefit is not conflicted remuneration if:

(a) the benefit consists of a percentage, of no more than 100%, of a brokerage fee that is given to a provider who is a trading participant of a prescribed financial market or the market known as the ASX24; and

(b) the provider, directly or indirectly, gives the benefit to a representative of the provider.

Note 1: For prescribed financial market , see regulation 1.0.02A .

Note 2: The ASX24 is the financial market operated by Australian Securities Exchange Limited that was formerly known as the Sydney Futures Exchange.

7.7A.12D(1A)    

A monetary benefit is not conflicted remuneration if:

(a) the benefit is a fee paid between a financial services licensee that is a trading participant of a prescribed financial market and a financial services licensee that is not a trading participant in respect of dealings undertaken by a retail client through a specified service; and

(b) each of those trades is executed by the trading participant on behalf of the retail client; and

(c) the fee is a percentage, not exceeding 100%, of a brokerage fee paid directly or indirectly by the retail client; and

(d) no portion of the benefit is paid to a person other than the trading participant or the licensee that is not a trading participant.

7.7A.12D(2)    

In this regulation:

brokerage fee
means a fee that a retail client pays to a provider in relation to a transaction in which the provider, on behalf of the retail client, deals in a financial product that is traded on:

(a) a prescribed financial market; or

(aa) the market known as the ASX24; or

(b) a prescribed foreign financial market.

Note 1: Regulations 7.7A.17 and 7.7A.18 relate to exemptions in relation to the charging of asset-based fees on borrowed amounts.

Note 2: The ASX24 is the financial market operated by Australian Securities Exchange Limited that was formerly known as the Sydney Futures Exchange.

prescribed foreign financial market
means a financial market that:

(a) has its principal place of business in a foreign country; and

(b) has been authorised by an authority in that country that is a signatory to the International Organization of Securities Commissions ' Multilateral Memorandum of Understanding Concerning Consultation and Cooperation and the Exchange of Information of May 2002.

specified service
means a service which:

(a) is provided for retail clients under the name or brand name of:

(i) the financial services licensee that is not a trading participant; or

(ii) the trading participant and the financial services licensee that is not a trading participant; and

(b) relates to the dealing, on behalf of the retail client, in a financial product traded on:

(i) a prescribed financial market; or

(ii) a prescribed foreign financial market; and

(c) is provided in either or both of the following ways:

(i) by direct electronic access;

(ii) by telephone, but only if:

(A) direct electronic access is not available for a temporary period, or the retail client expresses a preference that the service be provided by telephone; and

(B) neither the trading participant nor the financial services licensee that is not a trading participant is to provide financial product advice to the retail client by telephone in relation to the dealing undertaken on the retail client ' s behalf; and

(d) is provided in circumstances in which neither the trading participant nor the financial services licensee that is not a trading participant provides personal advice to the retail client in relation to the dealing undertaken on the retail client ' s behalf.

trading participant
of a prescribed financial market or the market known as the ASX24 means a person who:

(a) is a participant of the market admitted under the market ' s operating rules; and

(b) is allowed, under the market ' s operating rules, to deal in one or more of the financial products that are able to be traded on the market.

Note: The ASX24 is the financial market operated by Australian Securities Exchange Limited that was formerly known as the Sydney Futures Exchange.