ASIC Class Order [CO 00/0179]

Overview

The ASIC Class Order [CO 00/179], introduced in 2000 under subsection 741(1) of the Corporations Act 2001, addresses the problem of exempting certain publishers from the prohibitions outlined in subsection 734(2) of the Act. This order, prepared by the Australian Securities and Investments Commission (ASIC), aims to facilitate the publication of advertisements and statements regarding foreign securities while ensuring compliance with relevant legislative requirements and market operating rules in the jurisdictions where such publications occur. The exemption applies to advertisements or statements published in newspapers or periodicals produced outside Australia, with the majority of their circulation also outside Australia, and either clearly indicating that they are not intended for Australian residents or published in media not advertised within Australia. The policy objective is to balance the need for market transparency with the practicalities of international financial communications.

Scope and Application

The ASIC Class Order [CO 00/179], operating under subsection 741(1) of the Corporations Act 2001, pertains to the exemption of certain publishers from the prohibition against disseminating advertisements or statements regarding foreign securities within Australia. Specifically, the order exempts individuals or entities publishing in foreign newspapers or periodicals that are produced outside Australia and have their primary circulation outside the country. These publications must make it clear that the content is not intended for Australian residents or must be published in media not advertised within Australia. Furthermore, the publishers must ensure compliance with the legislative requirements and financial market operating rules of the country where the publication originates. This exemption does not apply if the publication is intended for Australian residents or if it is advertised within Australia. The scope of this exemption is limited to advertisements or statements made in compliance with the specified conditions and is subject to amendments through subordinate instruments such as [CO 02/265], which further refine the criteria under which the exemption applies.

Key Provisions

The ASIC Class Order [CO 00/179] under the Corporations Act 2001 provides specific exemptions for certain individuals or entities, referred to as “publishers” in Schedule A, from the prohibitions under subsection 734(2) of the Act. This exemption applies when the publishers are involved in publishing advertisements or statements about securities of a foreign corporation or a proposed foreign corporation in particular circumstances detailed in Schedule B. For instance, the exemption applies if the advertisement or statement is published in a newspaper or periodical produced outside Australia and circulated primarily outside Australia, if it is clearly stated that the advertisement or statement is not meant for Australian residents, or if it adheres to the financial market regulations of the country where the publication originates. Under this Class Order, publishers must ensure that their advertisements or statements meet specific criteria to qualify for the exemption. These include confirming that the publication is not intended for or capable of being acted upon by Australian residents and that it complies with the laws and market rules of the country where it is produced. This ensures that the publications are governed by the appropriate regulatory standards of the foreign jurisdiction, thereby maintaining a balance in regulatory oversight. Failure to comply with the provisions of this Class Order can result in legal consequences. While the specific penalties are not outlined in the Class Order, breaches of the Corporations Act 2001 can generally lead to substantial fines and potential criminal charges. The severity of the penalties can depend on the nature and extent of the breach, and may include penalties for individuals and corporations as stipulated in the Act. It is crucial for publishers to adhere to these guidelines to avoid any legal repercussions. In summary, the ASIC Class Order [CO 00/179] provides an exemption for certain publishers from specific prohibitions under the Corporations Act 2001, provided they meet the conditions outlined in Schedule B. These conditions ensure that the advertisements or statements are not targeted at Australian residents and comply with the relevant foreign regulations. Non-compliance with these provisions can lead to legal penalties, underscoring the importance of adhering to the stipulated guidelines.