What does this really mean?

It is important to note that this is a ‘no action’ position rather than a change of law. ASIC has noted that a legal risk remains and that this does not affect private rights of third parties to take action. ASIC has also warned that it will take action against providers who miscategorise clients, e.g. under the general test as a wholesale client without an accountant’s certificate.

Some aspects remain unclear

Uncertainty still remains:
• as to when a service is “advice that relates to superannuation”. If the financial service relates to a superannuation product, the $10 million net asset test is the only applicable test.
• on the calculation of net assets for the general test. For example, whether the assets of the SMSF can be combined with the assets of the trustee to meet the general test.
• on which tests apply when the trustee is not a single individual trustee. For example, when the trustee is a corporate trustee or when there are more than one individual as trustee and one individual does not meet the general test. ASIC also has not clarified if the general test or large transaction test can be used in these circumstances. It would be prudent for advisers and product providers to seek legal advice when the providing services to SMSF with different control structures.

For further information

Certainty can help you meet all aspects of your AFSL obligations. Please contact our office on (02) 8324 5300 or enquiries@certaintycompliance.com.au.