On 12 August 2011, the Australian Securities and Investments Commission (ASIC) released a suite of disclosure benchmarks for Product Disclosure Statements for Over-the-Counter Contracts for Difference (OTC CFDs). OTC CFDs are considered high risk financial products requiring more detailed disclosure on a number of key points. Providers will be required to disclose against the benchmarks specified by ASIC, or explain why they have not. The benchmarks include:
- client qualification policies;
- acceptable forms of opening collateral;
- counterparty risk (hedging practices);
- financial resources held; and
- use of client money.
The Regulation Impact Statement was prepared by ASIC and was assessed as adequate by the Office of Best Practice Regulation.