Commonwealth Consolidated Regulations

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CORPORATIONS REGULATIONS 2001 - REG 7.7.10AE

Situations in which Statement of Advice not required

                   For paragraph 951C(1)(c) of the Act, Part 7.7 of the Act applies as if section 946B of the Act were omitted and the following section were substituted:

"946B  Situations in which a Statement of Advice is not required

First situation: further advice

             (1)  The providing entity does not have to give the client a Statement of Advice for particular advice (the further advice ) if subsection (2) or (2A) applies.

             (2)  This subsection applies if:

                     (a)  the providing entity has previously given the client a Statement of Advice that set out the client's relevant personal circumstances in relation to the advice (the previous advice ) set out in that Statement; and

                     (b)  the client's relevant personal circumstances in relation to the further advice (determined having regard to the client's objectives, financial situation and needs as currently known to the providing entity) are not significantly different from the client's relevant personal circumstances in relation to the previous advice; and

                     (c)  so far as the basis on which advice is given relates to other matters--the basis on which the further advice is given is not significantly different from the basis on which the previous advice was given.

Note:          Paragraphs 947B(2)(b) and 947C(2)(b) require a Statement of Advice to include information about the basis on which the advice is or was given, which may include the client's relevant personal circumstances, in which case paragraph (a) of this subsection would be satisfied.

          (2A)  This subsection applies if:

                     (a)  the client had a relationship with the providing entity before:

                              (i)  if the providing entity is a licensee--the day on which the providing entity obtained its Australian financial services Licence; or

                             (ii)  if the providing entity is an authorised representative--the day on which the licensee on whose behalf the advice is provided obtained its Australian financial services Licence; and

                     (b)  the providing entity gave the client advice (the earlier advice ) of a kind that if it were given after the day the Australian financial services Licence was obtained would be considered to be personal advice ; and

                     (c)  the client's relevant personal circumstances in relation to the further advice are not significantly different from the client's investment objectives, financial situation and particular needs that were determined for the earlier advice; and

                     (d)  so far as the basis on which advice is given relates to other matters--the basis on which the further advice is given is not significantly different from the basis on which the earlier advice was given.

             (3)  At the same time or as soon as practicable after the further advice is given to the client, the client must be given a statement that contains the information that would, if a Statement of Advice were to be given, be required to be in the Statement by paragraphs 947B(2)(d) and (e), or 947C(2)(e) and (f), as the case requires, and by section 947D, if applicable.

          (3A)  The providing entity must keep a record of the further advice and, in doing so, must comply with any applicable requirements of regulations made for the purposes of this subsection.

Note 1:       Failure to comply with this subsection is an offence (see subsection 1311(1)).

Note 2:       For the client's right to a record of the advice, see subsections 942B(8) and 942C(8).

Note 3:       Subsections 947D(2) and (3) require additional information to be included in the record in certain circumstances.

Second situation: certain basic deposit and other products

             (5)  The providing entity does not have to give the client a Statement of Advice if the advice relates to any or all of the following:

                     (a)  a basic deposit product;

                     (b)  a facility for making non-cash payments (see section 763D) that is related to a basic deposit product;

                     (c)  a financial product of a kind prescribed by regulations made for the purposes of this paragraph.

             (6)  However, if subsection (4) applies and the client is not given a Statement of Advice, the client must instead, when, or as soon as practicable after, the advice is provided, be given the information that would be required to be in the Statement of Advice by paragraphs 947B(2)(d) and (e), or 947C(2)(e) and (f), as the case requires."



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