Document ID: chunk:federal_register_of_legislation:F2023C00928:reg:8:p8
Version: federal_register_of_legislation:F2023C00928
Segment Type: reg
Provision Reference: reg 8 (pt 8/34)
Character Range: 31544–34241

MDA service; and
(b) the information is actually known to the licensee or, if the licensee is a body corporate, any director of the licensee.
Note:  The information required by subsection (2) is affected by section 1013C(2) of the Act (as notionally modified by ASIC Corporations (Disclosure of Fees and Costs) Instrument 2019/1070.

912AEB MDA contracts
(1) The licensee must ensure that each MDA service it provides to a person as a retail client is provided under a MDA contract that:
(a) clearly specifies the nature and scope of the discretions that the licensee will be authorised to, and those that the licensee is required to, exercise and the investment strategy that is to be applied in exercising those discretions; and
(b)  contains a prominent warning that identifies the key areas of difference between acquiring a financial product directly and through the MDA service and, in the case of:
(i)  a contract that is entered into electronically—the part of the facility that allows the person to enter into the contract displays a prominent statement; and
(ii) otherwise—the contract requires the person entering into the contract to sign an acknowledgement;
to the effect that the person entering into the contract acknowledges the matters contained in the warning; and
(c) provides:
(i)  how the contract may be terminated; and
(ii)  that the client or the licensee may terminate the contract by giving a period of notice which is not more than 2 business days; and
(iii) that the contract will be terminated if ASIC notifies the licensee that it may not rely on an exemption relating to the MDA service; and
(iv) if the contract is terminated:
(A) that the licensee must not exercise any discretion in relation to the client portfolio assets but must comply with the terms of the contract as to how to deal with any client portfolio assets; and
(B) how and when the client portfolio assets will be disposed of, or transferred to the client, if those assets are not held directly by the client; and
(v) that the licensee must have and maintain written policies:
(A) setting out the steps it will take to ensure that if the contract is terminated, the client portfolio assets will be dealt with in accordance with the requirements referred to in subparagraph (iv); and
(B) that are available to the client free of charge on request.
              (2) The licensee must ensure that each MDA contract obliges the licensee to:
                  (a) perform its obligations under the MDA contract and this section honestly and with the degree of care and diligence that a reasonable person would exercise if they were in the licensee's position in providing the MDA service to the client;