The Australian Securities and Investments Commission (ASIC) has today released the external report into Regulatory Guide 97 Fees and costs disclosure (RG 97) commissioned in November 2017.
The report, prepared by expert Darren McShane, concludes changes to the disclosure regime would be advantageous, and includes discussion of:
- the way fee and cost information is presented to consumers; and
- some of the information to be included in this disclosure.
ASIC has welcomed Mr McShane's report as a comprehensive analysis of the fees and costs issues arising under the Australian regulatory framework. In preparing the report, Mr McShane engaged with over 120 different stakeholders as well as reviewing approaches to fees and costs disclosure in other jurisdictions.
ASIC agrees changes to the fees and costs disclosure are in the interests of consumers and industry, and is keen to ensure any changes are practicable for industry while providing transparency and useable comparability for consumers. In the first half of the 2018-19 financial year, ASIC will release a consultation paper setting out ASIC’s proposed response to the issues raised in Mr McShane's report.
In the meantime, ASIC's facilitative compliance approach to fees and costs disclosure will continue. ASIC again emphasises the importance of disclosure not misleading consumers. In the last six months, ASIC has intervened to improve disclosure in cases where we had concerns that consumers could be misled.
ASIC will continue to provide updates including through the ASIC website.
Background
In November 2017, as part of the on-going work to develop better costs disclosure, ASIC announced:
- an extension of its facilitative compliance approach to fee and cost disclosure; and
- the appointment of an external expert to review the fees and costs disclosure in RG 97 to ensure it is transparent for consumers.
ASIC has undertaken these actions in response to feedback from across the industry around challenges with the practical implementation of RG 97 (17-369MR).