Overview

The ASIC Class Order [06/264], enacted in 2006 under the Corporations Act 2001, was introduced to address the need for regulatory adjustments in the oversight of managed investment schemes, particularly those associated with horse racing syndicates. This legislation was created by the Australian Securities and Investments Commission (ASIC) under the authority granted by the Act, aiming to streamline and refine the regulatory framework governing these schemes. The primary objective of this Class Order is to ensure that the regulatory responsibilities are clearly defined and appropriately assigned, particularly with respect to the Lead Regulator for such schemes. This change reflects an adaptation in the administrative structure to better align with the current regulatory environment, ensuring that oversight remains effective and compliant with legislative requirements.

Scope and Application

The ASIC Class Order [06/264] applies to persons involved in the management and promotion of participating horse racing syndicates, which are considered managed investment schemes under the Corporations Act 2001. Specifically, the order amends the definition of the Lead Regulator in Class Order [02/319], substituting the Harness Racing Authority with the Greyhound and Harness Racing Regulatory Authority. This change aligns the regulatory oversight of these schemes with the current governing body for greyhound and harness racing. The order is made under paragraph 601QA(1)(a) of the Act, which allows ASIC to exempt persons from certain provisions of Chapter 5C, thereby providing conditional relief to promoters and operators of participating horse racing syndicates. The geographic reach of the Act is national, applying across all states and territories of Australia. However, the specific exemptions and relief provided by this Class Order are targeted at the particular industry of horse racing syndicates. There are no stated exclusions or exemptions in this Class Order, but the application of subordinate instruments may further extend or restrict its scope.

Key Provisions

ASIC Class Order [CO 06/264], issued under the Corporations Act 2001, primarily concerns the regulation of managed investment schemes, specifically horse racing syndicates, and modifies a previous Class Order [CO 02/319]. The key operative section referenced is paragraph 601QA(1)(a), which allows ASIC to exempt individuals from certain provisions of Chapter 5C of the Act. The primary amendment in this Class Order is the substitution of the Lead Regulator from the Harness Racing Authority to the Greyhound and Harness Racing Regulatory Authority (paragraph 2). This change ensures that the regulatory oversight for these schemes is aligned with the current regulatory body responsible for greyhound and harness racing. The obligations imposed by this Class Order include the requirement for promoters of managed investment schemes, such as horse racing syndicates, to be registered under Chapter 5C of the Corporations Act. Additionally, the promoters must hold an Australian financial services licence. The Class Order [CO 02/319] provides conditional relief to these promoters and operators, which is further refined by [CO 06/264] by updating the identity of the Lead Regulator. This ensures that the regulatory framework remains effective and current with the industry's regulatory bodies. Breaches of the Corporations Act or non-compliance with the requirements set out in ASIC Class Orders can lead to various consequences. Although specific offences and penalties are not detailed within the explanatory statement, it is known that violations of the Corporations Act can result in both civil and criminal penalties. The severity of these penalties can vary depending on the nature and extent of the breach, with potential maximum penalties for breaches of financial services laws including substantial fines and imprisonment for individuals found guilty of criminal offences. Compliance with these regulatory requirements is critical to avoid these potential consequences.