ASIC Class Order [CO 10/288]

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Legislation au F2010L01075 Not in force Legislative Instrument

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ASIC Class Order [CO 10/288]

About this compilation

 

Compilation No. 1

 

This is a compilation of ASIC Class Order [CO 10/288] as in force on 31 May 2018. It includes any commenced amendment affecting the legislative instrument to that date.

 

This compilation was prepared by the Australian Securities and Investments Commission.

 

The notes at the end of this compilation (the endnotes) include information

about amending instruments and the amendment history of each amended provision.

 

Australian Securities and Investments Commission

Corporations Act 2001 — Paragraph 1020F(1)(a) — Exemption

 

Enabling legislation

 

1.  The Australian Securities and Investments Commission makes this instrument under paragraph 1020F(1)(a) of the Corporations Act 2001 (the Act).

 

Title

 

2.  This instrument is ASIC Class Order [CO 10/288].

 

Commencement

 

3.  This instrument commences on the date it is registered under the Legislative Instruments Act 2003.

 

Note:  An instrument is registered when it is recorded on the Federal Register of Legislative Instruments (FRLI) in electronic form: see Legislative Instruments Act 2003, s 4 (definition of register).  The FRLI may be accessed at http://www.frli.gov.au/.

 

Exemption

 

4.  A person does not have to comply with subsection 1020AB(3) of the Act to the extent it requires the person to give the particulars specified in paragraphs 7.9.100(1)(a) to (c) of the Corporations Regulations 2001 in relation to:

 

Market makers

 

(a) a sale by the person of a security (the shorted product) or a managed investment product (the shorted product) where:

 

(i) the person:

 

(A) makes a market for a financial product (the hedged product); and

 

(B) issues, acquires or disposes of the hedged product in the course of making that market; and

 

(C)  holds an Australian financial services licence that covers making a market in the hedged product or is exempt from the requirement to hold such a licence for providing that financial service; and

 

(ii) the sale of the shorted product by the person is a bona fide transaction to manage, avoid or limit the financial consequences of the person issuing, acquiring or disposing of the hedged product in the course of making a market in the hedged product; or

 

ETF market makers

 

(b) a sale by an ETF market maker of interests in, or securities of, an exchange traded fund in the course of making a market in those interests or securities.

 

Interpretation

 

5.  In this instrument:

 

ASX means ASX Limited.

 

Chi-X means Chi-X Australia Pty Limited.

ETF market maker, in relation to interests in, or securities of, an exchange traded fund that is able to be traded on a financial market operated by ASX or Chi-X, means a person who:

(a)   holds an Australian financial services licence that covers making a market in the interests or securities or is exempt from the requirement to hold such a licence for providing that financial service;

(b)   has entered into an agreement, or is registered, with the relevant market operator to make a market for those interests or securities.

exchange traded fund (or ETF) means a scheme or foreign company that satisfies all of the following:

(a) is:

(i) a registered scheme or a managed investment scheme that is not required to be registered under Chapter 5C of the Act; or

(ii) a foreign company which has the economic features of a managed investment scheme and is an open-ended investment company registered with the U.S. Securities and Exchange Commission under the Investment Company Act 1940 of the United States of America;

(b) interests in the scheme or securities of the foreign company are in a class that are able to be traded on a financial market operated by ASX or Chi-X;

(c) the operator of the scheme or foreign company has the power and approval to issue interests or securities in that class on any day that those interests or securities are able to be traded on the relevant financial market;

(d) the operator of the scheme or foreign company allows applications for and redemptions of interests or securities in that class on any day that those interests or securities are able to be traded on the relevant financial market;

(e) the price or value of the financial product, index, currency, commodity or other thing that the fund invests in or tracks is continuously disclosed or can be immediately ascertained.


makes a market has the meaning given by section 766D of the Act.

 

 

Notes to ASIC Class Order [CO 10/288]

Note 1

ASIC Class Order [CO 10/288] (in force under s1020F(1)(a) of the Corporations Act 2001) as shown in this compilation comprises that Class Order amended as indicated in the tables below.

Table of Instruments

Instrument number

Date of registration

Date of commencement

Application, saving or transitional provisions

[CO 10/288]

29/4/2010 (see F2010L01075)

29/4/2010

 

2018/3

30/5/2018 (see F2018L00671)

31/5/2018

-

Table of Amendments

ad. = added or inserted     am. = amended      rep. = repealed     rs. = repealed and substituted

Provision affected

How affected

Para 4(b).........

rs. 2018/3

Para 5...........

am. 2018/3

 

Overview

ASIC Class Order [CO 10/288] was enacted in 2010 under the authority of the Corporations Act 2001, aiming to address specific regulatory gaps related to the disclosure obligations of certain financial market participants. This legislative instrument was issued by the Australian Securities and Investments Commission (ASIC) to provide exemptions to market makers and ETF market makers from certain disclosure requirements, facilitating more efficient financial market operations while maintaining investor protection. The objective is to streamline regulatory compliance for these entities, enabling them to focus on market-making activities without undue bureaucratic burdens. This Class Order came into effect on 29 April 2010 and has been subject to amendments, the latest of which took effect on 31 May 2018.

Scope and Application

ASIC Class Order [CO 10/288] applies to persons who are involved in the sale of securities or managed investment products by market makers, specifically those making a market for a financial product, provided they hold an Australian financial services licence or are exempt from holding such a licence. This includes sales of securities or managed investment products that are conducted as a bona fide transaction to manage, avoid, or limit the financial consequences of issuing, acquiring, or disposing of the hedged product in the course of making a market. Additionally, the order applies to ETF market makers who are involved in the sale of interests in, or securities of, an exchange traded fund in the course of making a market for those interests or securities. The order has a national reach, as it applies to transactions across Australia and is governed by the Commonwealth under the Corporations Act 2001. The exemption provided by the order is limited to the specific circumstances outlined and does not extend to other types of transactions or entities not covered by the defined terms. The application of the order may be further clarified or extended through subordinate instruments, which are subject to the amendment history and legislative changes noted in the endnotes of the compilation.

Key Provisions

The ASIC Class Order [CO 10/288], made under paragraph 1020F(1)(a) of the Corporations Act 2001, provides exemptions from certain disclosure requirements for specific types of financial transactions. Primarily, it exempts persons who make markets in financial products from having to disclose certain details in relation to sales of securities or managed investment products if those sales are part of a bona fide transaction to manage, avoid or limit financial risks arising from their market making activities (section 4). Additionally, it exempts ETF market makers from the disclosure requirements when selling interests in, or securities of, exchange-traded funds in the course of making a market in those interests or securities (section 4). The Order came into force on 29 April 2010, as per section 3, and was registered under the Legislative Instruments Act 2003. The Order defines key terms such as "ETF market maker" and "exchange traded fund," which are essential for understanding its scope and application (section 5). Entities that make markets in financial products, including ETF market makers, are subject to specific obligations under this Class Order. They must ensure that the sales of securities or interests in exchange-traded funds are bona fide transactions intended to manage, avoid, or limit financial risks arising from their market-making activities (section 4). This means that they need to be able to demonstrate that the transactions were not merely speculative or unrelated to their market-making role. Moreover, these entities must hold an Australian financial services licence that covers making a market in the relevant products or be exempt from the requirement to hold such a licence (section 4(a)(i) and (ii)). There are no explicit offences or penalties mentioned in the Class Order itself. However, any failure to comply with the Corporations Act 2001 or the Corporations Regulations 2001, which this Order is designed to exempt certain activities from, could potentially lead to civil or criminal penalties as prescribed under those Acts. The penalties for breaches of the Corporations Act can include substantial fines and, in some cases, imprisonment, depending on the nature and severity of the breach. The specific penalties are detailed within the Corporations Act 2001 and are not elaborated upon in this Class Order.

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Corporate Law & Governance
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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.