Super funds score win on stamp duty disclosure

The way in which super funds will have to disclose stamp duty as part of fees and costs to members is changing from July.

From July 1, stamp duty paid in one year will be disclosed over the following seven years in fees and costs summaries publishing in Product Disclosure Statements, rather than as an annual sum.

The change is in response to concerns the inclusion of transaction costs, including stamp duty, may have been negatively influencing investment decisions by super funds, including deterring investment in certain asset classes.

ASIC consulted on amending the ASIC Corporations (Disclosure of Fees and Costs) (Instrument 2019/1070) in recent months as stamp duty "is a large, irregular cost which may misrepresent the actual volatility of a fund's fees and costs structure, distorting consumer decision-making and funds' investment decisions, especially when viewed through particular comparative tools."

It received 14 submissions in total, with some recommending stamp duty costs be disclosed as a rolling average over seven years or reclassified as a statutory tax or incidental costs as opposed to a transaction cost.

ASIC said it will consider whether any costs need to be reclassified in its review of ASIC Instrument 2019/1070 and Regulatory Guide 97: Disclosing fees and costs in PDSs and periodic statements, which it is bringing forward from 2029 to next financial year.

In a further change, ASIC issued a new class order relief for superannuation trustees, aligning portfolio holdings disclosure obligations for internally managed private debt with externally managed private debt.

Currently, trustees managing private debt assets internally must disclose the value of individual assets by issuer or counterparty even when there is only a single transaction with them. There was concern this may risk confidentiality, distort super funds' investment decisions, and incentivise outsourcing of private debt assets which could increase costs to members.

Under the change, trustees must only disclose the aggregated value and weighting of internally managed private debt assets.