APRA's clarification arises from updates related to TDPs in their frequently asked questions on the performance test, stating that the categorisation of SMAs and other managed accounts as TDPs depends on their structural features. The pivotal factor is whether beneficiaries can direct changes in the investment's strategic asset allocation. According to regulations under the Superannuation Industry (Supervision) Act, an investment qualifies as a TDP if beneficiaries cannot compel trustees to modify asset class allocations attributable to them.
Managed Investment Schemes (MISs) are also encompassed under the TDP category, with APRA stating that all investment options should be presumed subject to the performance test. Moreover, the regulator highlighted significant ramifications if a TDP fails the performance assessment in one superannuation fund but passes in another.
While the performance test results for a TDP pertain specifically to the responsible superannuation entity (RSE) licensee, APRA anticipates that other licensees will reassess their stances. Regardless of the TDP classification, if an investment option falls short in the performance test, APRA expects RSE licensees to determine whether the continued offering of such options aligns with the best financial interests of their members.
This development underscores APRA's commitment to ensuring that superannuation products meet performance benchmarks, safeguarding members' financial interests.
