Corporations Amendment Regulations 2010 (No. 4) (89 of 2010)

Schedule 1   Amendments

[9]   After regulation 7.7.09B

insert

7.7.09BA Statement of Advice from authorised representative

(1) For paragraph 947C (2) (h) of the Act, a Statement of Advice given by an authorised representative in relation to a margin lending facility, or a margin lending facility whose limit is proposed to be increased, within the meaning of subsection 761EA (1) of the Act must include the following information:

(a) whether the client has taken out a loan to fund the secured property or transferred securities contributed by the client for establishing the margin lending facility;

Note This is sometimes referred to as ‘double gearing’.

(b) if a loan to fund the secured property or transferred securities contributed by the client for establishing the margin lending facility has been taken out - whether the security for the loan includes the primary residential property of the client;

(c) whether there is a guarantor for the margin lending facility, and, if so:

(i) if the authorised representative has the necessary information - a statement as to whether the guarantor has been appropriately informed of, and warned about, the risks and possible consequences of providing the guarantee; or

(ii) if the authorised representative does not have the necessary information - a statement that the authorised representative does not have the information;

(d) the amount of any other debt incurred by the client;

(e) any other matter that ASIC has specified in a legislative instrument for subregulation (2).

(2) ASIC may specify in a legislative instrument any matter ASIC considers to be relevant for the purpose of establishing whether the margin lending facility, or the margin lending facility with the increased limit, is unsuitable for the client.

7.7.09BB Modification of subsection 947C (4) of the Act

For paragraph 951C (1) (c) of the Act, Part 7.7 of the Act applies as if subsection 947C (4) of the Act were modified by:

(a) substituting the full stop at the end of paragraph (c) with a semi-colon; and

(b) inserting after paragraph (c) the following paragraph:

‘(d) that ASIC may specify in a legislative instrument matters ASIC considers to be relevant for the purposes of paragraph 947C (2) (h) of the Act.’