ASIC Class Order [CO 02/0252]

Overview

The Financial Services Reform Act 2001 was enacted to modernise and streamline the financial services legislation in Australia. This legislative instrument, the Australian Securities and Investments Commission Corporations Act 2001 - Subsection 741(l) - Variation, was introduced to address the need for updating and aligning existing regulatory frameworks with the newly enacted Corporations Act 2001. Enacted by the Australian Parliament, the policy objective behind this legislation was to ensure a consistent and uniform approach to the regulation of financial services and markets across Australia. The Australian Securities and Investments Commission (ASIC) has exercised its power under the Corporations Act 2001 to update various class orders, including Class Order [00/183], to reflect the changes brought about by the new Act. The instrument aims to substitute references to the old "Corporations Law" with the new "Corporations Act 2001" and update definitions and terminology to align with the new legislative framework. This variation ensures that the regulatory requirements remain current and applicable within the new legal environment established by the Corporations Act 2001.

Scope and Application

The Australian Securities and Investments Commission, pursuant to subsection 741(1) of the Corporations Act 2001, has amended Class Order [00/183] to adapt to the changes brought about by the Financial Services Reform Act 2001. This legislative instrument primarily affects entities and individuals involved in the securities market within Australia, particularly those engaged in transactions related to securities quoted on approved foreign markets. The amendments focus on updating references from the former "Corporations Law" to the current "Corporations Act 2001" and adjusting the interpretation of terms such as "market" instead of "exchange." The revised order applies to securities quoted on designated markets, including prominent global exchanges and NASDAQ National Market, and outlines specific conditions for securities to be considered quoted on an approved foreign market over a 36-month period. The geographic reach of these amendments is confined to Australia, as clarified by the definition of "this jurisdiction" in sections 5 and 9 of the Act. The legislative instrument also includes a note clarifying the term "this jurisdiction" to mean Australia, ensuring that the updated terminology and definitions are understood within the context of Australian law.

Key Provisions

The Australian Securities and Investments Commission (ASIC) has varied Class Order [00/183] of the Corporations Act 2001 through a legislative instrument effective from the commencement of Schedule 1 to the Financial Services Reform Act 2001. The primary aim of this variation is to update and modernise references within the Class Order to reflect legislative changes and terminology updates in the Corporations Act. For instance, the Class Order now refers to the "Corporations Act 2001" instead of the "Corporations Law," and "market" instead of "exchange." Furthermore, it replaces the term "Australia" with "this jurisdiction" in various sections to ensure clarity and consistency. Entities governed by the Corporations Act, particularly those involved in securities trading and market operations, must ensure their practices and documentation comply with these updated references. This includes revising internal policies, compliance programs, and any external filings to reflect the updated terminology. Additionally, the updated Class Order specifies that securities are considered quoted on an approved foreign market under certain conditions, including being quoted on major global exchanges such as the New York Stock Exchange, London Stock Exchange, and others. Failure to comply with the updated provisions could result in non-compliance with the Corporations Act. While the legislative instrument does not explicitly outline specific offences or penalties for non-compliance with these textual changes, general provisions of the Corporations Act may apply. This means that entities could face enforcement actions, fines, or other regulatory consequences if they fail to adhere to the updated requirements. The penalties for non-compliance with the Corporations Act can be significant, including substantial fines for corporations and potential criminal charges for individuals found guilty of serious breaches. The exact penalties depend on the nature and severity of the non-compliance, as well as any mitigating or aggravating factors considered by the court.