ASIC has new regulations in place that require issuers and distributors of financial products to have governance frameworks ensuring funds are targeted at the right people. The Design and Distribution Obligation regime includes rules about disclosures and clearly defined Target Market Determination (TMD), helping investors clarify the appropriateness of a fund.
All our funds’ TMDs can be found here – simply select the fund name from the drop-down list.
What does this mean for product issuers?
Product issuers, such as Bennelong, are required to:
- develop a 'target market determination' for each relevant product (i.e. define a target audience for each fund);
- take reasonable steps to ensure distribution is consistent with the determination (i.e. the funds are attracting the right people);
- keep records and notify ASIC of 'significant dealings' which are inconsistent with the determination (i.e. when investors fall outside the determination); and
- review the determination regularly.
What does this mean for distributors?
Distributors such as financial advisers must:
- only recommend products when all reasonable enquiries and determination have been made ensuring recommendations are consistent with the determination (i.e. funds are being recommended to the right people); and
- keep records and notify the issuer of 'significant dealings' that are inconsistent with the determination (i.e. when investors fall outside the determination).
Complaints and reporting
Reporting and monitoring for the Bennelong TMDs
We will collect the following information from our distributors in relation to the Bennelong issued TMDs.
Complaints
Distributors will report the number of complaints in relation to the product(s) covered by this TMD on a quarterly basis. Reporting is still required if the number of complaints is zero. This will include the substance of complaints and general feedback relating to the product and its performance.
Reporting can be provided using the FSC data standards complaint form, which can be found on the FSC website.
Significant dealings
Distributors will report if they become aware of a significant dealing in relation to the Bennelong issued TMDs within 10 business days. A significant dealing includes circumstances where:
- 10% of consumers who have acquired the product who are outside the target market over a quarterly period;
- 10% of consumers who have acquired the product have characteristics that are specifically excluded from the target market;
- Distribution conditions have regularly not been met.
All correspondence relating to the DDO regime can be emailed to: ddo@bennelongfunds.com
Insert here the information, or link to information, about how reports must be sent to the Issuer. This information should include the transmission mechanism, data format, minimum version of relevant FSC data standards, the appropriate security standard(s) and the issuer contact details).
