On 28 July 2015, ASIC released a new regulatory guide to financial service providers in an attempt to streamline the disclosure of information to consumers through digital channels.
The new Regulatory Guide 221 - Facilitating online financial services disclosures (RG 221) can be found here.
Under the previous scheme (ASIC Class Order 10/1219), the relevant client’s agreement was required before disclosure documents could be provided digitally. The regime set out in RG 221 replaces the ASIC Class Order and allows for the default delivery method for product disclosure statements, financial services guides and statements of advice (amongst other documents) through digital means (that is, if an electronic address was provided by the client, then the financial services provider does not need the clients agreement to send disclosure documents to that electronic address).
In the press release for the new RG 221, ASIC Commissioner John Price said, “The measures announced today respond to changing consumer preferences, with ever increasing numbers of people transacting digitally…[T]he changes mean product disclosure statements (PDS) and other financial services disclosure documents will be delivered to consumers digitally as the default option, unless the consumer opts out. This will reduce the costs of printing and mailing for businesses while preserving choice for those consumers who wish to receive paper.”
The following “quick guide” on how disclosure documents can be delivered is contained in RG 221:
Delivery of disclosure in full to an electronic address
Delivery of disclosure using other digital delivery methods
Disclosures may be delivered digitally in full to an electronic address (e.g. an email address):
Disclosures may be delivered using any digital method (e.g. a digital message with a hyperlink to the disclosure):
Lavan Legal comment
The new regime for the disclosure of information through digital means is a real practical change. Financial services providers should consider how they can take advantage of the new RG 221 because the potential time and cost savings (in terms of printing and postage) could be substantial.