FAQs: FSGs and website disclosure information
This is Information Sheet 291 (INFO 291). It answers frequently asked questions (FAQs) about obligations relating to Financial Services Guides (FSGs) and website disclosure information.
The purpose of an FSG is to ensure that retail clients receive key information about the type of financial services being offered by ‘providing entities’ – that is, Australian financial services (AFS) licensees and authorised representatives – to decide whether to obtain financial services from an entity. For some financial services, a providing entity may make statements and provide information that it is required to include in an FSG available on its website (known as website disclosure information).
We have prepared these FAQs to help providing entities understand their FSG obligations. This information sheet covers questions relating to:
- giving an FSG or website disclosure information (Questions 1–8)
- making website disclosure information available (Questions 9–13)
- disclosures in an FSG or website disclosure information (Questions 14–16), and
- obligations for secondary service providers and intermediaries, and record-keeping obligations (Questions 17–18).
Note: In this information sheet, all section references are to the Corporations Act 2001 (Corporations Act) and regulation references are to the Corporations Regulations 2001 (Corporations Regulations).
Giving an FSG or website disclosure information
1. Who must give an FSG?
The obligation to give an FSG applies to AFS licensees and authorised representatives that provide financial services (providing entities) to retail clients: see sections 941A and 941B. The obligation is subject to exemptions (see Question 6), including if website disclosure information is made available on the providing entity’s website (see Questions 9–13).
2. Can an FSG cover more than one providing entity?
We consider that the Corporations Act does not prevent an FSG from covering more than one providing entity. For example, a single FSG may cover all the providing entities in a conglomerate group, or both a corporate authorised representative and all the individual representatives appointed. Likewise, website disclosure information may cover more than one providing entity.
The content requirements (see Question 14) must still be satisfied if an FSG or website disclosure information covers more than one providing entity. These include the requirement that the information be worded and presented in a clear, concise and effective manner (see sections 942B(6A) and 942C(6A)) and not be misleading or deceptive: see, e.g. sections 1041E and 1041H for prohibitions.
3. Can a providing entity have more than one FSG?
We consider that a providing entity can have more than one FSG on issue at any one time, provided that each FSG complies fully with the requirements in Part 7.7 of the Corporations Act.
4. When must a providing entity give an FSG to a client?
A providing entity must generally give an FSG to a client as soon as practicable after it becomes apparent that a financial service will be, or is likely to be, provided to that client. As a minimum, a providing entity must give an FSG to a client before providing a financial service (see sections 941A, 941B and 941D(1)), unless an exemption applies – for example, the entity can make website disclosure information available on its website for the financial service.
We encourage providing entities that must give an FSG to do so in enough time so that clients have an adequate opportunity to consider it before deciding whether to obtain the financial services. We also encourage providing entities to give an FSG to a client when requested.
It is an offence not to give an FSG when one is required: see section 952C. This does not apply if the defence in section 952C(4) concerning authorised representatives that reasonably rely on information or instructions from their AFS licensee applies. It also does not apply if the providing entity had ‘no reasonable opportunity’ to give an FSG – for example, where:
- general advice is broadly distributed (e.g. by media release), or
- a client refuses to provide their contact address upon request from the providing entity in a general advice situation: see section 940B.
We consider that there will be a reasonable opportunity for a providing entity to give an FSG in a personal advice situation. We also consider that there will be a reasonable opportunity for a providing entity to give an FSG if it had a reasonable opportunity to seek the client’s contact details but did not do so: see section 940B(2).
For guidance on:
- when an FSG may be given later in time critical situations, see Question 5
- when an FSG does not need to be given, see Question 6
- how an FSG must be given, see Question 7, and
- when website disclosure information may be made available by publishing an FSG on the providing entity’s website, see Question 10.
5. Can an FSG be given after a financial service is provided?
An FSG can be given after a financial service is provided, but only in certain ‘time critical’ situations – that is, if:
- the client expressly instructs or requests that the financial service be provided immediately (e.g. in a phone call) or by a specified time, and
- it is not reasonably practicable to give the client an FSG before that financial service is provided as instructed: see section 941D(2).
If this occurs when an FSG is required (see Question 6 for situations when an FSG is not required), the providing entity must give the client a statement about certain matters such as remuneration (including commission and other benefits) and associations or relationships with issuers of financial products: see section 941D(3). The FSG must also be given as soon as practicable after the financial service has been provided and, at the latest, within 5 days of providing that service: see section 941D(4).
Information in an FSG given in a time critical situation need only be up to date at the time the earlier statement is given to the client: see section 941E(2).
6. In what situations is a providing entity not required to give an FSG?
A providing entity is not required to give an FSG to a client when:
- dealing with certain types of clients
- providing the information in another way
- giving general advice in particular situations, or
- dealing, advising or arranging in the ordinary course of certain operations.
An FSG may also not be required for certain:
Providing entities should be aware that they may still need to provide other information to the client.
Certain types of clients
A providing entity does not need to give an FSG to a retail client who is not located in Australia or to a wholesale client: see sections 941A and 941B, and regulation 7.7.21.
Providing information in another way
A providing entity does not need to give an FSG to a client when it provides information in a way detailed in Table 1.
Table 1: Other ways to provide information
Way of providing information | Details |
Website disclosure information | This way is available if the financial service is financial product advice or dealing in a financial product for the purposes of implementing that advice. The information must contain the statements and information required in an FSG and be made available on the providing entity’s website by the time the entity would otherwise be required to give the client an FSG: section 6 of ASIC Corporations (Financial Services Guide) Instrument 2015/541 and section 941C(5A). |
Existing FSG | The client has already received an FSG that contains all the information that a new FSG would contain – for example, if new advice is provided to a client but the FSG information is unchanged: section 941C(1). |
With or as a Product Disclosure Statement (PDS) | See Question 8 for more information on replacing or combining a PDS with an FSG. |
Giving general advice in particular situations
A providing entity does not need to give an FSG to a client when it gives general advice in the situations outlined in Table 2.
Table 2: General advice in particular situations
Situation | Details |
---|---|
General advice to the public | This advice may be provided at any event organised by or for AFS licensees to which retail clients are invited, by public broadcast or in promotional materials that are accessible to the public (e.g. television or radio broadcasts, newspaper and magazine advertising, public lectures and social media posts).
The providing entity must provide certain information that would have been required to be disclosed in an FSG if it was to be given (the ‘minimum information’) – that is:
|
General advice in advertising about a financial product or securities that the entity issues, or a class of financial products that includes a product that the entity issues | The advertisement must indicate that a person should consider whether the product or securities are appropriate for them: regulation 7.7.02(5A) and ASIC Corporations (Advertising by Product Issuers) Instrument 2015/539.
Note: The advertisement must be in the form of a billboard, poster or in the media (as defined in regulation 7.6.01(7)) unless it is for securities the entity issues: see regulation 7.7.02(5A)(c) and ASIC Instrument 2015/539. |
General advice as a product issuer or distributor, or certain related entities, about a financial product, or class of products, that is not provided during a meeting | This advice may be provided by mail or email or – in the case of an existing client – during a telephone call about a class of products that includes a product that the client already holds or where no financial product is issued or sold.
The providing entity is the product issuer or a related body corporate, an AFS licensee that offers the product for sale (product distributor) or an authorised representative of the product issuer, related body corporate or product distributor. The client must be provided the minimum information and, if applicable, the name and contact details of the authorising licensee: regulations 7.7.02(4) and 7.7.02(5). If the advice is provided during a telephone call, the providing entity must tell the client that an FSG exists, and it will send out an FSG on request: regulation 7.7.02(4A). |
Dealing, advising or arranging in the ordinary course of certain operations
A providing entity does not need to give an FSG when it deals in, advises about or arranges to deal in financial products in the situations outlined in Table 3.
Table 3: Dealing, advising or arranging in the ordinary course of certain operations
Relevant conduct | Details |
---|---|
Dealing in financial products by the products’ issuer | The dealing must not involve tradeable derivatives that the providing entity issued and must not also relate to financial products issued by someone else: section 941C(2). |
Dealing in financial products in the ordinary course of operating a superannuation entity | The providing entity must be the trustee of the superannuation entity, and the client must be a member of the superannuation entity: section 941C(2A). |
Dealing in financial products in the ordinary course of operating a registered scheme | The providing entity must be the responsible entity of a registered scheme, and the client must be a member of the scheme: section 941C(2B). |
Dealing in financial products in the ordinary course of operating a corporate collective investment vehicle (CCIV) | The providing entity must be the corporate director of a CCIV, and the client must be a member of the CCIV: section 941C(2C). |
Advising about, or arranging to deal in, non-cash payment facilities to pay a person for a financial product or a financial service in the ordinary course of business |
The providing entity must not be an AFS licensee or must be licensed but not authorised to provide the relevant financial service: regulations 7.7.02(3A) and 7.6.01(1)(la). |
Providing certain financial services
A providing entity does not need to give an FSG to a client when it provides the financial services in Table 4.
Table 4: Providing certain financial services
Financial service | Details |
---|---|
Operating a fund, scheme or service | The financial service consists only of operating:
|
Any financial service related to certain banking products | The financial service relates to:
The providing entity must provide the client with its name and contact details, a lack of independence statement (if applicable) (see Question 16), and information about its dispute resolution system and how it may be accessed: sections 941C(6)–(7) and regulations 7.7.02(1), 7.7.05C(1)(a) and 7.7.05C(2)(a). |
Claims handling and settling service | The claims handling and settling service is provided to a client without representing the client in pursuing an insurance claim: section 941C(7A). |
Secondary service | The secondary service provider has a written agreement with an intermediary under which the intermediary will give the secondary service provider’s FSG to the client or inform the client about how to obtain the FSG: regulation 7.7.02(7).
For more information on FSGs for secondary services, see Question 17. |
Issuing certain financial products
A providing entity does not need to give an FSG to a client when it issues the financial products in Table 5.
Table 5: Issuing certain financial products
Financial product | Details |
---|---|
Motor accident injuries insurance product for vehicle rental | The providing entity must issue the insurance product to a client following a client phone call about renting a vehicle and arrange for a document that is the equivalent of an FSG to be given to the client no later than the start of the vehicle rental: regulation 7.7.02(3). |
Some types of derivatives | The providing entity must be an issuer of derivatives that can be traded on a financial market, and the financial service must only be dealing in a derivative by the providing entity who cannot be a participant in that financial market: regulation 7.7.02(5B). |
Providing certain foreign financial services
A providing entity does not need to give an FSG when it provides the foreign financial services in Table 6.
Table 6: Providing certain foreign financial services
Financial service | Details |
---|---|
Foreign financial services provided by a foreign provider and not intended or likely to induce use | The foreign provider is exempt from the requirement to hold an AFS licence when providing the service as the conduct is not intended, and is not likely, to induce Australians to use the service: regulation 7.9.98, and notional section 911A(2A) (as inserted by regulation 7.6.02AG). |
Foreign financial services provided by a foreign provider (other than a foreign passport fund or its operator) that relate to products issued in the absence of active soliciting | The foreign provider is exempt from the requirement to hold an AFS licence as the service relates to a financial product that was issued to an Australian client when the client was overseas or follows an application or inquiry from the client. The providing entity must not actively solicit persons in Australia in relation to the product: regulation 7.9.98, and notional section 911A(2D) (as inserted by regulation 7.6.02AG).
Note: This exemption extends to products that supplement the initial product (e.g. a non-cash payment facility added to an investment account) or that are of the same kind as, and issued in substitution for, the original financial product (e.g. renewal of an insurance policy). |
Certain financial services provided by a foreign participant in a licensed overseas financial market | The participant is exempt from the requirement to hold an AFS licence to provide the service as it relates to a product traded on the licensed overseas financial market and the participant believes on reasonable grounds that the client is not in Australia: regulation 7.9.98, and notional section 911A(2B) (as inserted by regulation 7.6.02AG). |
Foreign financial services provided by a foreign provider for AFS licensees | The foreign provider is exempt from the requirement to hold an AFS licence to provide the service as it is provided to an AFS licensee (or person exempt from holding an AFS licence) who is not acting on someone else’s behalf in relation to the service – for example, as a trustee, responsible entity or corporate director: regulation 7.9.98, and notional section 911A(2C) (as inserted by regulation 7.6.02AG). |
Foreign financial services provided by a foreign provider for professional investors | The foreign provider is exempt from the requirement to hold an AFS licence to provide the service as it is provided to a professional investor and consists of any (or all) of dealing in, providing advice on or making a market in:
|
7. How must a providing entity give an FSG to a client?
A providing entity must give an FSG to a client in printed or electronic form by:
- personally giving it to the client or the client’s agent (section 940C(1)(a)(i))
- sending it to the client or the client’s agent at an address (including an electronic address) that the client or their agent has nominated (section 940C(1)(a)(ii))
- making it available to the client or their agent in a manner agreed on (section 940C(1)(a)(iii)), or
- publishing it digitally and notifying the client that the disclosure is available – in this case, certain steps must be taken, including that the client is first given the opportunity to opt out of this method of delivery (ASIC Corporations (Facilitating Electronic Delivery of Financial Services Disclosure) Instrument 2015/647).
Note: A client’s agent cannot be a person who is acting in a capacity mentioned in section 940C(6). This includes an AFS licensee or authorised representative who is also the client’s agent.
If an FSG is given in electronic form, it must as much as practicable be presented in a way that allows the client to keep a copy or have ready access to it in the future: see regulation 7.7.01(3).
8. When can a PDS replace, or be combined with, an FSG?
There are two sets of circumstances in which a providing entity may rely on a PDS to replace, or be combined with, an FSG.
In the first set of circumstances, a providing entity can combine an FSG and a PDS if they are:
- the product issuer for a product issued in relation to the relevant financial service (see regulation 7.7.08A(2))
- an authorised representative or related body corporate of the product issuer, but only if the product is a basic deposit product, non-cash payment facility related to a basic deposit product, general insurance product or life risk insurance product (see regulation 7.7.08A(3)), or
- a person arranging for the issue of a financial product by a product provider under an ‘intermediary authorisation’ (as defined in section 911A(2)(b)) (see section 5(3) of ASIC Instrument 2015/541 and Information Sheet 141 Dealing and providing custodial or depository service as secondary service (INFO 141)).
Note: An FSG cannot be combined with a PDS in any of these circumstances if the PDS is for a standard margin lending facility or a product that qualifies for the shorter PDS regime: see regulation 7.7.08A(1B)–(1D) and Information Sheet 155 Shorter PDSs – Complying with requirements for superannuation products, simple managed investment schemes and simple sub-fund products (INFO 155).
In the second set of circumstances, if the financial service is a product recommendation, sale or issue (see sections 1012A–1012C), a providing entity may rely on information in the product issuer’s PDS to meet its FSG obligation. The providing entity must include any information required in an FSG that is not already in that PDS in an accompanying statement that it provides to the client at the same time as the PDS: see notional sections 941C(1A) and, 941C(7AA) and 941C(7AB) (as inserted by regulation 7.7.02A(1) and (2)), and sections 942B and 942C)).
The accompanying statement must be up to date when given to the client, and worded and presented in a clear, concise and effective manner: see notional section 941C(7AB) (as inserted by regulation 7.7.02A(2)).
Disclosure requirements for combining an FSG and a PDS
Unless the circumstances in section 5(4) of ASIC Instrument 2015/541 apply, a combined FSG and PDS must be:
- divided into two separate parts identifiable as an FSG and a PDS
- titled ‘Combined Financial Services Guide and Product Disclosure Statement’ at or near the front or beginning of the document (see section 7 of ASIC Corporations (Removing Barriers to Electronic Disclosure) Instrument 2015/649), and
- provided to the client at the earlier of the required time for an FSG or a PDS: regulations 7.7.08A(2)–(3).
If the providing entity is an authorised representative or a related body corporate of the product issuer, a combined FSG and PDS must also clearly and prominently disclose:
- the identity of the providing entity and the product issuer
- the relationship between them, and
- their respective liabilities: regulation 7.7.08A(3)(e).
Within the combined document, the individual FSG and PDS sections of the document can cross-reference each other. Cross-references must be clear, concise and effective and not make the overall document misleading or deceptive: see regulation 7.7.08A(4).
Making website disclosure information available
9. What is website disclosure information?
Website disclosure information means the statements and information that a providing entity is required to include in an FSG that are made available on its website: see section 943J. Website disclosure information gives providing entities the flexibility to decide how they disclose information to clients that is otherwise required to be in an FSG.
For more information about the statements and information that must be disclosed in website disclosure information, see Question 14.
10. Can a providing entity publish its FSG on its website as website disclosure information?
A providing entity can publish its FSG on its website as website disclosure information, but only if the providing entity has not already given the FSG to the client for the financial service: see section 941C(5A)(b)(ii) and Question 7.
If a providing entity publishes its FSG on its website without giving the FSG to the client, it will be website disclosure information. This is also the case if a hyperlink to the content is then circulated to a client.
Providing entities should be aware that website disclosure information must be kept up to date and specify the date on which it was prepared or last updated: see Question 11. This obligation applies if a providing entity has published its FSG on its website as website disclosure information.
11. What requirements apply to the format of website disclosure information?
Website disclosure information can appear on different pages of a providing entity’s website and include written or graphic information. It can also be made available in a variety of formats, such as a PDF or Word file.
Website disclosure information must also be readily accessible, be up to date and specify the date on which it was prepared or last updated: see sections 943K and 943L. If the website disclosure information is materially altered, it must clearly show the date on which it was altered: see section 943M(b). This ensures that important changes are recorded and readily accessible to clients to inform their financial decisions.
Website disclosure information is not readily accessible if it is password protected or only accessible to persons who have created an account or have a paid subscription: see paragraph 1.216 of the Revised Explanatory Memorandum (PDF 1.17 MB) to the Treasury Laws Amendment (Delivering Better Financial Outcomes and Other Measures) Bill 2024 (DBFO Bill).
12. What is good practice when making website disclosure information available?
We encourage providing entities to apply our good practice guidance in Table 2 of Regulatory Guide 221 Facilitating digital financial services disclosures (RG 221) when making website disclosure information available. In particular, the information should:
- be easy to access, view and understand, so that the client can easily identify relevant sections or navigate the disclosure in a way that is meaningful to them
- not distract or divert clients from relevant information or include features that channel clients away from important information
- enable clients to readily identify the whole disclosure
- be available to clients as a printed or digital copy so that they can keep a copy of the disclosure to access in the future, and
- include information that enables clients to prove which version of the website disclosure information they relied on.
Providing entities should make it easy for clients to request a digital copy of website disclosure information. The client should not be charged for this digital copy.
Consistent with the expectation stated in paragraph 1.16 of the Supplementary Explanatory Memorandum (PDF 380 KB) to the DBFO Bill, we encourage providing entities to notify clients that website disclosure information is available on their website. This may be achieved by including a link to the information in email correspondence with the client.
13. What responsibilities apply to authorised representatives about website disclosure information?
An authorised representative must not make website disclosure information available on their website unless they have authorisation from the relevant AFS licensee to distribute that information: see sections 943H(3)–(4). An authorised representative must also not update website disclosure information unless they have been authorised by the relevant AFS licensee: see section 943M.
Disclosures in an FSG or website disclosure information
14. What must be included in an FSG or website disclosure information?
FSGs and website disclosure information have mandatory content requirements. The level of detail that must be included is generally what a person would reasonably require to make a decision about whether to acquire financial services from the providing entity: see sections 942B(3) and 942C(3).
FSG and website disclosure information must be worded and presented in a clear, concise and effective manner (sections 942B(6A) and 942C(6A)) and not include material that is misleading or deceptive. Information in an FSG must generally be up to date at the time it is given, or otherwise kept up to date if it is made available in website disclosure information: see section 943L and Question 11.
We encourage AFS licensees and authorised representatives to conduct consumer testing of FSGs and website disclosure information to help identify whether the information is clear, concise and effective, and not misleading, or if there is additional information that clients need to make a decision about acquiring the financial services.
Many of the content requirements noted in Table 7 are the same for AFS licensees and authorised representatives as providing entities – but there are some distinct requirements. The requirements apply to both FSGs and website disclosure information unless otherwise specified.
Table 7: Content requirements for FSGs or website disclosure information
Item | Required content | Source |
---|---|---|
Title | The title ‘Financial Services Guide’ on the cover, or at or near the front or beginning of, the FSG.
Note: We encourage providing entities to include equivalent identifying information on any webpage that includes website disclosure information – for example, the label ‘Website disclosure information’. |
Section 942A (as modified by section 7 of ASIC Instrument 2015/649) |
Date | The date of the FSG or the date on which the website disclosure information was prepared or last updated. | section 942B(5) and 942C(5) (FSGs)
section 943L(2)(b) (website disclosure information) |
Purpose statement | A statement of the purpose of the FSG or website disclosure information and, if appropriate, information about other disclosure documents that the client may receive (i.e. a Statement of Advice (SOA) or PDS) and a description of the purpose of those documents.
The purpose statement should, as a minimum, draw the client’s attention to the fact that the FSG or website disclosure information:
The purpose statement must be displayed prominently in an FSG, meaning it should appear at, or close to, the front of the FSG and stand out from other information in the FSG. Ideally, the statement should be placed on the inside cover or inside facing page of an FSG and equivalent position of website disclosure information. |
Regulations 7.7.03 and 7.7.06 (including notes) |
AFS licensee and authorised representative details | The providing entity’s name and contact details, and its AFS licence number or authorised representative number, as applicable.
Authorised representatives must also include details about the authorising licensee(s) that they act for when providing services, including the name, contact details and licence number of the licensee(s), and a statement that they are an authorised representative of the licensee(s). Note: In certain circumstances, the name and contact details of the providing entity do not need to be provided: see regulation 7.7.05B. |
Sections 912F and 942B(2)(a), and regulation 7.6.01C(1)(a) (AFS licensees)
Sections 942C(2)(a) and (l), notional section 942C(2)(e) (as substituted by regulation 7.7.10AB(2)), and regulations 7.7.05A and 7.7.06A (authorised representatives) |
Authorised services | Information about the financial services that the providing entity will, or is likely to, provide to the client and the kinds of financial products to which the services relate.
Note: An FSG does not need to include information about financial services detailed in Table 4. |
Notional section 942B(2)(c) (as substituted by regulation 7.7.10AB(1)) (AFS licensee)
Notional section 942C(2)(c) (as substituted by regulation 7.7.10AB(2)) (authorised representative) |
Statement on instructions from client | Any special instructions about how the client may provide instructions to the providing entity. | Section 942B(2)(b) (AFS licensee)
Section 942C(2)(b) (authorised representative) |
Remuneration | For information about how remuneration must be disclosed, see Question 15. | N/A |
Associations and relationships | Information about any association or relationship between the following entities and the issuers of any financial products that might reasonably be expected to influence the providing entity in providing any of the authorised services:
|
Section 942B(2)(f) (AFS licensee)
Section 942C(2)(g) (authorised representatives) |
Statement on lack of independence | For more information about what must be disclosed if the financial service is personal advice and the providing entity is not independent, impartial or unbiased, see Question 16. | N/A |
Dispute resolution | Information about the dispute resolution system that covers complaints by clients to whom the providing entity provides financial services and how the system may be accessed. | Section 942B(2)(h) (AFS licensee)
Section 942C(2)(i) (authorised representative) |
Compensation arrangements | Details of the kind of arrangements the providing entity has in place for compensating retail clients for losses they suffer as a result of a breach by the entity of its obligations under Chapter 7 of the Corporations Act (i.e. whether through professional indemnity insurance or otherwise), and whether the arrangements comply with the requirements in section 912B and regulation 7.6.02AA.
For more information about the compensation requirements, see Regulatory Guide 126 Compensation and insurance arrangements for AFS licensees (RG 126). |
Regulation 7.7.03A (AFS licensee)
Regulation 7.7.06B (authorised representative) |
Records of further advice | If the financial service is further advice (as defined in regulation 7.7.10B), a statement that the client may request a record of further advice (if one has not been provided already) and how the client may request such a record.
Note: The time limit for the client to make this request cannot be less than 7 years after the day on which the further advice is provided: see regulations 7.7.05 and 7.7.08. |
Notional section 942B(2)(g) (as substituted by regulation 7.7.10AC(1)) (AFS licensee)
Notional section 942C(2)(h) (as substituted by regulation 7.7.10AD(1)) (authorised representative) |
Binder arrangements | If the providing entity is acting under a binder (as defined in section 761A) in providing any authorised services, a statement:
Note: The providing entity should generally include an explanation of the circumstances in which it will be acting under a binder. |
Section 942B(2)(i) (AFS licensee)
Section 942C(2)(j) (authorised representative) |
Licensed market or clearing and settlement facility participants | If the providing entity or an authorising AFS licensee is a participant in a licensed market or clearing and settlement facility, a statement to that effect. | Section 942B(2)(j) (AFS licensee)
Section 942C(2)(k) (authorised representative) |
15. What are the requirements when disclosing remuneration information?
Content of remuneration information
An FSG or website disclosure information must include information about remuneration (including commission or other benefits) that the following persons will receive for, or that is attributable to, any of the authorised services:
- For AFS licensee providing entities – The providing entity and any related bodies corporate, their directors or employees, an associate of any of these persons, or any other person that has received, or will receive, remuneration for referring another person to the providing entity (section 942B(2)(e) and regulation 7.7.04(2)).
- For authorised representative providing entities – The providing entity, its employer(s), its authorising licensee(s) (including their employees or directors), an associate of any of these persons, or any other person that has received, or will receive, remuneration for referring another person to the providing entity or its authorising licensee(s) (section 942C(2)(f) and regulation 7.7.07(2)).
Remuneration information detailed in Table 8 must be disclosed.
Table 8: Remuneration information that must be disclosed
Type of remuneration | Information that must be disclosed |
---|---|
Remuneration that is ascertainable at the time the FSG is given | The remuneration received or that will be received: regulations 7.7.04(3) and 7.7.07(3). |
Remuneration that is not ascertainable at the time the FSG is given when personal advice will be given | Information on:
|
Remuneration that is not ascertainable at the time the FSG is given when personal advice will not be given | Information on:
Note: If a client requests the particulars of the remuneration, the particulars must be presented in a way that is easy for the client to understand: see regulations 7.7.04A(4) and 7.7.07A(4). |
Remuneration for referrals | The remuneration received or that will be received for referring another person to the providing entity or an authorising licensee, as applicable: regulation 7.7.04(1) and 7.7.07(1). |
Information that does not need to be disclosed includes:
- small value, non-monetary benefits that are not conflicted remuneration under section 963C(1)(b) (regulations 7.7.04AA and 7.7.04AB), and
- remuneration that is received only for, or that is only attributable to, a financial service detailed in Table 4 (regulations 7.7.05C(1)(b) and 7.7.05C(2)(b)).
Presentation of remuneration information
Information about remuneration should be presented in one location and in a way that is easy for the client to understand, consistent with the requirement when a client requests more detailed remuneration information in regulations 7.7.04A(4) and 7.7.07A(4). This could include ranges, rates, comparisons, simple tables and formulas.
It may not be possible to know the full remuneration that is attributable to all the financial services when the FSG is given or the website disclosure information is made available. It is acceptable if an FSG or website disclosure information states that a providing entity is paid an annual salary and includes a general description of any factors that will influence the amount. However, it is not acceptable to merely state that a benefit will or may be received and that the client can ask for further details.
Following is an example of what an FSG or website disclosure information could include for life risk insurance products:
I will receive an upfront commission from the product issuer if you decide to buy a life risk insurance product I recommend to you. I will receive an upfront commission of between 0% and 60% of the first year’s annual premium, and then an annual ongoing commission of between 0% and 20% of the annual premium. For example, for an insurance product with an annual premium of $10,000 (excluding GST and stamp duty), where the issuer pays me an upfront commission of 60%, I will receive $6,000. The issuer will pay me 20% of the annual premium as ongoing commission for as long as you hold the product. Assuming an annual premium of $10,000 (excluding GST and stamp duty), this equates to $2,000 per year.
Information about the monetary benefits described in this example also needs to be disclosed as part of the obligation to obtain informed consent for certain insurance commissions in section 963BB: see Information Sheet 292 FAQs: Informed consent for insurance commissions (INFO 292).
16. What must be disclosed if a providing entity is not independent, impartial or unbiased?
If a providing entity is not independent, impartial or unbiased, and its authorised services include the provision of personal advice to clients, the FSG or website disclosure information must include a statement to this effect and explain the reasons why: see sections 942B(2)(fa)(i) and 942C(2)(ga)(i).
The statement must:
- appear on the first substantive page of the FSG or in a prominent position in website disclosure information
- appear within a box under a bold heading that includes the phrase ‘Not independent’, ‘Lack of independence’, or another similar phrase
- be in a font size that is at least the same font size as that predominantly used for other text in the FSG or website disclosure information, and
- not appear in a footnote: see sections 5 and 6(b) of ASIC Corporations (Disclosure of Lack of Independence) Instrument 2021/125.
We do not consider that headings such as ‘Statement on the independence of our firm’, ‘Statement of independence’ or ‘Independence’ are appropriate as they imply that providing entities are independent: see Attachment to INFO 291 Example lack of independence disclosure statement and annotations.
A providing entity should not use the words ‘independent’, ‘impartial’ or ‘unbiased’ if, for example, the providing entity:
- receives commissions on the provision of advice for life risk insurance products and the commissions are not rebated in full to clients (section 923A(2)(a)(i))
- is wholly owned by the issuer of financial products that the entity gives personal advice about to retail clients (section 923A(2)(e)), or
- has an AFS licensee, or another authorised representative that is authorised by the providing entity’s AFS licensee, that receives commissions, volume-based payments or other gifts or benefits (sections 923A(2)(a)(i)–(iii) and 923A(2)(b)).
Other obligations regarding FSGs
17. How do the FSG obligations apply to secondary services?
An FSG may be required for a financial service that is provided as a secondary service – that is, a financial service provided to a client in circumstances where the providing entity does not have a direct relationship with the retail client.
Financial product advice
Financial product advice may be provided as a secondary service where an AFS licensee or authorised representative causes or authorises financial product advice to be given to a client. ‘Causing’ or ‘authorising’ does not always need to be express. The licensee or authorised representative is likely to be providing a secondary service if:
- it knows or should know that the advice or any part of it will be passed on to a third party, and
- the advice is attributed to the licensee or authorised representative when it is passed on.
We would not expect that an AFS licensee or authorised representative is providing financial product advice to a retail client – even if their advice is later passed on to a retail client and attributed to the licensee or representative, or helped an intermediary formulate its own advice – if:
- the licensee or representative expressly prohibits the intermediary from passing on their advice to any retail client
- the licensee or representative includes a prominent statement in their advice to the intermediary that the advice is only intended for use by wholesale clients and must not be made available to any retail client, and
- there is no reasonable basis to believe that the intermediary will fail to comply with the licensee’s or representative’s express prohibition.
Examples of when a secondary service may be provided
Example 1
A stockbroker allows a financial planner to pass on the stockbroker’s advice, which is attributed to the stockbroker, to the financial planner’s client.
Example 2
A general insurance broker passes on an underwriting agency’s advice regarding recommended insurance products to the broker’s client, attributing the advice to the agency.
Example 3
A research house issues a piece of research including general advice to clients that are AFS licensees. The AFS licensees post the research on their websites on a page that can be accessed by their retail clients with an acknowledgement of the source of the research. The research house is likely to be providing financial product advice to the retail clients by implicitly causing or authorising the provision of its advice to them.
Example of when a secondary service is not provided
Example 4
A research house issues a piece of research that includes general advice and posts this on its website, which is accessible to the public. An AFS licensee takes the information from the website and passes that information on to its retail clients as the research house’s advice. The research house has no agreement or relationship with the licensee and does not know the identity of the licensee’s clients. Although the research house may have provided general advice to the retail clients, this is not likely to be a secondary service. This is because, in the circumstances described, the research house does not know, and has no reasonable way of finding out, the identities or the addresses of the retail clients receiving the information disseminated by the licensee: see section 940B.
For more information about FSG obligations when dealing or providing a custodial or depository service as a secondary service, see INFO 141.
18. What are the record-keeping obligations for FSGs and website disclosure information?
If an AFS licensee or their authorised representative has an obligation to give an FSG, the AFS licensee should keep record of each version of the FSG that they or their representative has given. Likewise, if an AFS licensee or authorised representative has made available website disclosure information instead of an FSG, the AFS licensee should keep record of each version of website disclosure information that the licensee or their representative has made available.
We consider that retention of versions of FSGs and website disclosure information is part of the duties that licensees have to:
- do all things necessary to ensure that the financial services covered by the licence are provided efficiently, honestly and fairly (section 912A(1)(a)), and
- have an adequate dispute resolution system (section 912A(1)(g)).
AFS licensees may, as a condition on their licence, be required to keep:
- a copy of all versions of an FSG, including any Supplementary FSG, given by or on behalf of the licensee, or its authorised representative(s), for 7 years from the date that the version of the FSG was last given to a retail client – it is not necessary to keep a separate copy of the FSG on each client file
- website disclosure information made publicly available by the licensee or its authorised representative(s) for at least 7 years after that information was made available, and
- records (whether in physical, electronic or other form) about how the licensee and its representative(s) have implemented and monitored their obligation to give clients an FSG or make website disclosure information available: see conditions 52 and 53 of Pro Forma 209 Australian financial services licence conditions (PF 209).
Licensees should ensure they understand the conditions of their AFS licence.
Where can I get more information?
For more information, see:
- Attachment to INFO 291 Example lack of independence disclosure statement and annotations (PDF 107 KB)
- [CO 14/1262] Relief for 31 day notice term deposits
- ASIC Corporations (Advertising by Product Issuers) Instrument 2015/539
- ASIC Corporations (Financial Services Guides) Instrument 2015/541
- ASIC Corporations (Facilitating Electronic Delivery of Financial Services Disclosure) Instrument 2015/647
- ASIC Corporations (Removing Barriers to Electronic Disclosure) Instrument 2015/649
- ASIC Corporations (Disclosure of Lack of Independence) Instrument 2021/125
- PF 209 Australian financial services licence conditions
- RG 175 AFS licensing: Financial product advisers – Conduct and disclosure
- RG 221 Facilitating digital financial services disclosures
- INFO 141 Dealing and providing custodial or depository service as secondary service
- INFO 155 Shorter PDSs – Complying with requirements for superannuation products, simple managed investment schemes and simple sub-fund products
- INFO 292 FAQs: Informed consents for insurance commissions
- Revised Explanatory Memorandum (PDF 1.17 MB) to the DBFO Bill, and
- Supplementary Explanatory Memorandum (PDF 380 KB) to DBFO Bill.
Important notice
Please note that this information sheet is a summary giving you basic information about a particular topic. It does not cover the whole of the relevant law regarding that topic, and it is not a substitute for professional advice. We encourage you to seek your own professional advice to find out how the applicable laws apply to you, as it is your responsibility to determine your obligations.
You should also note that because this information sheet avoids legal language wherever possible, it might include some generalisations about the application of the law. Some provisions of the law referred to have exceptions or important qualifications. In most cases, your particular circumstances must be taken into account when determining how the law applies to you.
Information sheets provide concise guidance on a specific process or compliance issue or an overview of detailed guidance.
This information sheet was issued in November 2024.