Defined fees for superannuation products
209A Defined fees for superannuation products
The following definitions must be included for a superannuation product under the heading “Defined fees”:
Activity fees
A fee is an activity fee if:
the fee relates to costs incurred by the trustee [OR the trustees] of the superannuation entity that are directly related to an activity of the trustee [OR the trustees]:
that is engaged in at the request, or with the consent, of a member; or
that relates to a member and is required by law; and
those costs are not otherwise charged as an administration fee, an investment fee, a buy‑sell spread, a switching fee, an advice fee or an insurance fee.
Administration fees
An administration fee is a fee that relates to the administration or operation of the superannuation entity and includes costs incurred by the trustee [OR the trustees] of the entity that:
relate to the administration or operation of the entity; and
are not otherwise charged as an investment fee, a buy‑sell spread, a switching fee, an activity fee, an advice fee or an insurance fee.
Advice fees
A fee is an advice fee if:
the fee relates directly to costs incurred by the trustee [OR the trustees] of the superannuation entity because of the provision of financial product advice to a member by:
a trustee of the entity; or
another person acting as an employee of, or under an arrangement with, the trustee [OR the trustees] of the entity; and
those costs are not otherwise charged as an administration fee, an investment fee, a switching fee, an activity fee or an insurance fee.
Buy‑sell spreads
A buy‑sell spread is a fee to recover transaction costs incurred by the trustee [OR the trustees] of the superannuation entity in relation to the sale and purchase of assets of the entity.
Exit fees
An exit fee is a fee, other than a buy‑sell spread, that relates to the disposal of all or part of a member’s interests in a superannuation entity.
Indirect cost ratio
The indirect cost ratio (ICR), for a MySuper product or an investment option offered by a superannuation entity, is the ratio of the total of the indirect costs for the MySuper product or investment option, to the total average net assets of the superannuation entity attributed to the MySuper product or investment option.
A dollar‑based fee deducted directly from a member’s account is not included in the indirect cost ratio.
Investment fees
An investment fee is a fee that relates to the investment of the assets of a superannuation entity and includes:
fees in payment for the exercise of care and expertise in the investment of those assets (including performance fees); and
costs incurred by the trustee [OR the trustees] of the entity that:
relate to the investment of assets of the entity; and
are not otherwise charged as an administration fee, a buy‑sell spread, a switching fee, an activity fee, an advice fee or an insurance fee.
Switching fees
A switching fee is a fee to recover the costs of switching all or part of a member’s interest in the superannuation entity from one class of beneficial interest in the entity to another.
This Act’s bill:Explanatory statement
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