Product Disclosure Statement (PDS)

Product Disclosure Statement (PDS) is the disclosure document required under Chapter 7 of the Corporations Act 2001 (Cth) when a financial product is offered or recommended to a retail client. Its purpose is to give a retail investor enough information to make an informed decision. A PDS is not required for a wholesale client, which is the central boundary in this area.

Why It Matters

The PDS obligation is one of the clearest practical consequences of the retail and wholesale distinction. Because wholesale clients are not owed a PDS, wholesale mortgage and private credit funds issue an information memorandum instead. An investor moving from retail products into wholesale offers is moving out of a regime with prescribed content requirements and into one without them, and should understand that before comparing the two documents as though they are equivalent.

How It Works

A PDS must describe the product's significant features and benefits, its significant risks, the cost of the product, and any fees or charges.
It must identify the issuer, explain dispute resolution arrangements, and set out any other information a retail client would reasonably require.
Content requirements are prescribed by the Act and regulations, and the document must be worded and presented in a clear, concise and effective manner.
The obligation is triggered by the client's classification, not the product type. Correctly classifying the client is therefore a precondition, not an afterthought.

Common Use Cases

Retail offers of interests in a registered managed investment scheme
Comparing a retail fund against a wholesale fund offered under an IM
Determining whether retail disclosure obligations are triggered by an offer

Related Switchboard Resources

For ASIC guidance on product disclosure, visit asic.gov.au.

Do wholesale clients receive a PDS?

No. The PDS obligation applies to retail clients. This is why wholesale funds use an information memorandum, which has no prescribed content requirements.

Is a PDS approved by ASIC?

No. A PDS is not pre-approved or vetted by ASIC before it is issued. ASIC has powers to intervene where a document is defective, but issuing a PDS is not an endorsement of the product.

What is the difference between a PDS and a prospectus?

A prospectus is the Chapter 6D disclosure document for offers of securities such as shares and debentures. A PDS is the Chapter 7 document for financial products, including interests in a managed investment scheme. The distinction mirrors the split between the sophisticated investor and wholesale client tests.

General information only. This page explains a term used in Australian financial services law. It is general information, not legal or financial product advice, and does not take account of your objectives, financial situation or needs. Definitions and thresholds change. Confirm the current position on the Federal Register of Legislation or with a qualified professional before relying on it.