Commonwealth Consolidated Regulations

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Superannuation-sourced money

                   For the purpose of assessing the price of a financial product, or the value of a financial product to which a financial service relates, under paragraph 761G(7)(a) of the Act, superannuation-sourced money is not to be counted if:

                     (a)  the financial service provided to a person is:

                              (i)  financial product advice; or

                             (ii)  if the person was a retail client--the provision of a financial product in circumstances in which a Product Disclosure Statement would need to be given to the client under Part 7.9 of the Act (including section 1012A, 1012B, 1012C or 1012IA); and

                     (b)  the financial product to which the financial service relates is a product other than a non-cash payment financial product; and

                     (c)  the person who was the holder of the relevant superannuation interest in the regulated superannuation fund was or would have been a retail client under subsection 761G(6) of the Act if they had held or acquired the product after FSR commencement.

Example:    If:

(a)    the price for an income stream financial product or an investment-based financial product is $700 000; and

(b)    the client uses $400 000 of superannuation-sourced money and $300 000 of other funds;

                   then, unless the client is a wholesale client for another reason, the client will be a retail client due to the operation of paragraph 761G(7)(a) of the Act.

Note:          Under subsections 761G(5), (6) and (7) of the Act, general insurance products, superannuation products and RSA products are not financial products to which the restriction on counting superannuation-sourced money towards the price applies. This applies in addition to the exclusion for non-cash payment products under paragraph (b) of this regulation.

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