RG 97 Disclosing fees and costs in PDSs and periodic statements
RG 97 provides guidance on how fees and costs should be disclosed in Product Disclosure Statements (PDSs) and periodic statements.
The information in RG 97 is relevant for issuers of most superannuation products and managed investment products, and operators of notified foreign passport fund products issued to retail clients, which are required to make disclosure in accordance with the enhanced fee disclosure regulations.
The information is also relevant to issuers of investment life insurance products and operators of investor directed portfolio services (IDPSs) and managed discretionary account (MDA) services.
RG 97 was updated following public consultation and an external expert review of the regulatory guide, as well as consumer testing of proposed changes to the presentation of fees and costs. See RG 97 review and consultation and CP 308.
Following the updates to RG 97 in November 2019 and associated legislative instrument, ASIC has made minor technical amendments to clarify its position on policy issues and amend the PDS transition arrangements (see below).
Modifications to legislative obligations described in RG 97 are made in ASIC Corporations (Disclosure of Fees and Costs) Instrument 2019/1070. This instrument sets out the requirements that apply if an issuer adopts the requirements early or following the end of the transition period, described below.
The transitional version of RG 97 (released March 2017) will continue to be relevant during the transition period. However, the version of RG 97 (released November 2019, updated July 2020) provides industry with clearer guidance about existing fees and costs disclosure requirements that have not changed from March 2017.
Transition period and July 2020 amendments
For PDSs, the new requirements will apply to PDSs given on or after 30 September 2022. Issuers may elect to apply the updated PDS requirements from 30 September 2020.
For periodic statements (ongoing or on exit), the new requirements will apply to periodic statements for a reporting period that commences on or after 1 July 2021. Issuers may elect to apply the updated periodic statement requirements if the periodic statement is for a reporting period that:
- periodic statements commencing on or after 1 July 2020, or
- ends on a day that is on or after 1 July 2020 if the reporting period ends on the exit date because the holder of the product ceased to hold the product on the exit date.
Minor technical amendments have been made to:
- Performance fees:
- Clarify in the RG how to disclose performance fees when not charged;
- Confirm that the disclosure of the calculated average performance fees for each interposed vehicle in the ‘Additional explanation of fees and costs’ is not required;
- Ensure performance fees cannot be included in transaction costs;
- Clarify the election arrangements that apply to periodic statements so that the election can only be made by the product issuer;
- Confirm there is no change to the treatment of derivative costs;
- Significant event notices:
- Provide an exemption from the requirement to issue a significant event notice for issuers who merely update the calculation and presentation of their fees and costs to meet the requirements of ASIC Corporations (Disclosure of Fees and Costs) Instrument 2019/1070 for the first time;
- Provide clarity on SEN requirements where increases in fees arise due to increases in costs;
- Reinstate in Class Order [CO 14/1252] that buy-sell spreads do not need to be disclosed in periodic statements for managed investment products (ASIC does not intend to take action for non-compliance for the period between 29 November 2019 to 24 July 2020); and
- Make consequential amendments, correct cross referencing errors, incorrect labels and inconsistencies including in the ‘Example of annual fees and costs’ and ‘Consumer advisory warning’.
- Download RG 97 (updated July 2020)
- ASIC Corporations (Disclosure of Fees and Costs) Instrument 2019/1070
- ASIC Corporations (Amendment and Repeal) Instrument 2020/579 which amended ASIC Corporations (Disclosure of Fees and Costs) Instrument 2019/1070
For the requirements before the commencement of ASIC Corporations (Disclosure of Fees and Costs) Instrument 2019/1070 see:
- Transitional version of RG 97 released March 2017; and
- Transitional Q&As
- Class Order [CO 14/1252] Technical modifications to Schedule 10 of the Corporations Regulations
- ASIC Corporations (Amendment and Repeal) Instrument 2020/579 which amended [CO 14/1252]
- CP 308 Review of RG 97 Disclosing fees and costs in PDSs and periodic statements
- REP 637 Response to submissions on CP 308 Review of Regulatory Guide 97
- REP 638 Consumer testing of the fees and costs tools for superannuation and managed investment schemes
- 20-167MR ASIC releases minor updates to RG 97
- 19-328MR ASIC releases updated RG 97 on fees and cost disclosure
- Presentation materials (PDF 1 MB) from roundtable meetings in February and March 2020
- Q&A from roundtable meetings in February and March 2020, updated 24 July 2020.
If you have questions about the fee and costs disclosure requirements, please email ASIC at firstname.lastname@example.org.