Financial Products and Short-Form Disclosure Documents: A Comparative Analysis of Six Jurisdictions
Capital Markets Law Journal, Volume 10, Issue 2, 2015
28 Pages Posted: 17 Jul 2015
Date Written: July 16, 2015
This article analyses the international trend towards the adoption of short-form disclosure documents for retail financial products through a comparison of six jurisdictions: the European Union, Australia, Hong Kong, Singapore, Canada and New Zealand. For the purposes of the analysis, ‘short-form disclosure documents’ are defined to mean disclosure documents in respect of which the maximum page length is prescribed, either on a mandatory or recommended basis. The comparative analysis suggests some important findings. These include the strong interrelationship between factors such as purpose, length, liability and language and the extent to which each of these factors, particularly purpose, influences the other factors. Each choice or setting involves certain tradeoffs and achieving a comfortable balance is not an easy task for legislators and regulators. In addition, the findings reveal the challenges that all jurisdictions have encountered in terms of incorporating the key features and risks of complex products into a short-form disclosure document. Finally, there is widespread recognition of the need to treat disclosure as part of a broader range of measures, including measures to improve the quality of financial advice and to increase investor literacy.
Keywords: short-form disclosure, financial
JEL Classification: K00, K22
Suggested Citation: Suggested Citation