TWO class orders have been issued by the Australian Securities and Investments Commission to clarify the regulatory requirements that apply to wholesale and retail clients, given the different treatment of each under the Corporations Act.
As a general rule lighter regulatory requirements are imposed where financial services are only provided to wholesale clients.
One of the class orders has expanded the wholesale client category to include wholly owned subsidiaries of professional investors.
This relief is interim to allow any review of the legislation in this area.
Under the act, wholesale clients include people who are professional investors including financial institutions, listed entities and related bodies corporate of listed entities.
The other class order recognises certain foreign accountants as qualified accountants under the act. It extends the scope of qualified accountants to include any member of an eligible professional body who:
p Has at least three years of practical experience in accounting and auditing; and
p Is only providing a certificate for the purposes of paragraphs 708(8)(c) or 761(7)(c) of the act to a person who is resident in the same country (other than Australia) as that member.
Qualified accountants are able to give a certificate to allow an investor to be regarded as a wholesale client or sophisticated investor.
For the purposes of the foreign accountants’ class order, an eligible foreign body covers:
p The American Institute of Certified Public Accountants;
p Association of Certified Chartered Accountants (UK);
p Canadian Institute of Chartered Accountants;
p Institute of Chartered Accountants in England and Wales;
p The Institute of Chartered Accountants in Ireland; and
p The Institute of Chartered Accountants of Scotland.
Capital gains tax update 2004
Update on CGT developments during the 2003-04 income year.
Published: April 1 2004
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