Commonwealth Consolidated Regulations

CORPORATIONS REGULATIONS 2001 - REG 7.1.26

    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 RSAs 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.