Document ID: chunk:federal_register_of_legislation:C2005C00498:clause:1_945a
Version: federal_register_of_legislation:C2005C00498
Segment Type: clause
Provision Reference: sch 1 cl 945A
Character Range: 388406–390187

945A  Requirement to have a reasonable basis for the advice

 (1) The providing entity must only provide the advice to the client if:
 (a) the providing entity:
 (i) determines the relevant personal circumstances in relation to giving the advice; and
 (ii) makes reasonable inquiries in relation to those personal circumstances; and
 (b) having regard to information obtained from the client in relation to those personal circumstances, the providing entity has given such consideration to, and conducted such investigation of, the subject matter of the advice as is reasonable in all of the circumstances; and
 (c) the advice is appropriate to the client, having regard to that consideration and investigation.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).

 (2) In any proceedings against an authorised representative of a financial services licensee for an offence based on subsection (1), it is a defence if:
 (a) the licensee had provided the authorised representative with information or instructions about the requirements to be complied with in relation to the giving of personal advice; and
 (b) the representative's failure to comply with subsection (1) occurred because the representative was acting in reliance on that information or those instructions; and
 (c) the representative's reliance on that information or those instructions was reasonable.

Note: A defendant bears an evidential burden in relation to the matters in subsection (2). See subsection 13.3(3) of the Criminal Code.

 (3) A financial services licensee must take reasonable steps to ensure that an authorised representative of the licensee complies with subsection (1).

Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).