ASIC Class Order [CO 00/0184]

Overview

The Australian Securities and Investments Commission Corporations Law — Subsection 741(1) — Exemption Instrument 2000, enacted in 2000, addresses a specific gap in the Corporations Law by providing an exemption to responsible entities of registered schemes in particular circumstances. This legislative instrument was created pursuant to the authority of the Australian Securities and Investments Commission, operating under the auspices of the Commonwealth Parliament. The primary objective of this exemption is to facilitate the smooth operation of registered schemes in alignment with New Zealand securities regulations, particularly where the investment pertains to instruments defined under the NZ securities provisions and involves offers or invitations made in New Zealand. The exemption is contingent upon the condition that the responsible entity refrains from issuing notices or documents in New Zealand that do not conform to the NZ securities provisions, thereby ensuring regulatory compliance and protecting investors.

Scope and Application

The Australian Securities and Investments Commission Corporations Law — Subsection 741(1) — Exemption legislative instrument exempts each responsible entity of a registered scheme from a specific subsection of the Law under certain conditions. The exemption applies to the issue or transfer of interests in the scheme to applicants who are not responding to an application form, provided that the responsible entity reasonably believes the application pertains to an investment statement as defined under the New Zealand Securities Act 1978 and related regulations, and that the application relates to an offer or invitation made in New Zealand. This exemption is subject to the condition that the responsible entity does not issue or permit the issue of a notice or other document in New Zealand relating to the scheme’s interests if it does not comply with the relevant New Zealand securities provisions. The scope of this exemption is limited to the circumstances detailed in Schedule A, with the conditions specified in Schedule B ensuring the exemption is applied responsibly and in compliance with New Zealand securities laws. The legislative instrument operates within the Commonwealth jurisdiction and extends its reach to entities involved in cross-jurisdictional financial dealings, provided they adhere to the outlined conditions and exclusions.

Key Provisions

Under the legislative instrument F2007B00039, the Australian Securities and Investments Commission (ASIC) has exempted responsible entities of registered schemes from a specific requirement under the Corporations Law. Section 741(1) of the Corporations Law allows ASIC to issue such exemptions, and this particular exemption pertains to subsection 723(1) of the Law. This exemption is detailed in Schedule A, which outlines the circumstances under which the exemption applies. Specifically, the exemption allows for the issue or transfer of interests in the scheme to applicants who are not responding to an application form, provided the responsible entity reasonably believes the application relates to an investment statement as defined under the NZ securities provisions, and to an offer or invitation made in New Zealand. The obligations imposed on the parties governed by this legislation are primarily centred around compliance with the NZ securities provisions. The responsible entity must ensure that the issue or transfer of scheme interests complies with these provisions. Moreover, the exemption stipulates that the responsible entity must not issue or permit the issue of a notice or other document in New Zealand relating to the interests if it does not comply with the NZ securities provisions. This requirement is outlined in Schedule B and is a condition of the exemption's application. Failure to comply with the conditions outlined in the exemption can lead to various consequences. While the specific penalties are not detailed within the legislative instrument, breaches of the Corporations Law generally can attract civil or criminal penalties. Civil penalties can include fines up to a significant amount, while criminal penalties can include imprisonment, reflecting the seriousness with which the law treats non-compliance. The exact penalties would depend on the nature and severity of the breach, as well as any relevant case law or regulatory guidelines that might apply. It is crucial for responsible entities to adhere to the conditions to avoid any potential legal ramifications.