Overview

The ASIC Class Order [CO 11/162] was enacted in 2011 by the Australian Securities and Investments Commission (ASIC) under the Corporations Act 2001. The legislation addresses the issue of providing conditional relief from certain provisions in the Act to entities that present consolidated financial statements, particularly those that include the financial statements of related registered schemes or parent entities in their reports. This Class Order builds on previous legislative changes, including those from the Corporations Amendment (Corporate Reporting Reform) Act 2010, which modified the requirements for parent entity financial statements. The policy objective is to streamline reporting practices for entities that offer shares or interests under specific plans, thereby reducing the regulatory burden while maintaining essential disclosure requirements. The Class Order [CO 11/162] varies an earlier order, [CO 09/425], to provide conditional relief to entities that take advantage of other reliefs, such as including related registered schemes' financial statements in a single report ([CO 06/441]) and parent entity financial statements ([CO 10/654]). The relief applies to offers of shares or interests under certain purchase plans, aiming to ensure that these entities comply with the Act while benefiting from more flexible reporting standards. ASIC determined that no consultation was necessary for this Class Order, as it is considered minor or machinery in nature and does not substantially alter existing arrangements.

Scope and Application

ASIC Class Order [CO 11/162] applies to entities such as companies, registered schemes, and disclosing entities that are taking advantage of specific reliefs provided by other class orders, namely [CO 05/644], [CO 06/441], and [CO 10/654]. These entities are specifically permitted to include parent entity financial statements in their reports, and to include financial statements of related registered schemes with a common responsible entity in a single document. The Class Order is designed to provide conditional relief from certain provisions in Chapter 6D and Part 7.9 of the Corporations Act 2001, particularly in relation to the offering of share and interest purchase plans by ASX-listed companies and managed investment schemes to existing members. This Class Order extends across Australia and is applicable under federal law, as it is made by the Australian Securities and Investments Commission (ASIC) under the Corporations Act 2001. The relief provided is conditional and subject to the terms and conditions of the referenced class orders, and the order itself does not substantially alter existing arrangements, hence no consultation was undertaken by ASIC.

Key Provisions

The ASIC Class Order [CO 11/162], made under the Corporations Act 2001, aims to provide conditional relief to entities that utilise certain other class orders. These include Class Order [CO 05/644], Class Order [CO 06/441], and Class Order [CO 10/654], which address the presentation of financial statements and the offering of securities and financial products. Specifically, Class Order [CO 11/162] allows entities to be relieved from certain provisions in Chapter 6D and Part 7.9 of the Act in relation to the offering of share and interest purchase plans by ASX-listed companies and managed investment schemes, respectively (subsections 741(1) and 1020F(1)). The obligations imposed by Class Order [CO 11/162] require entities to comply with the conditions stipulated in Class Orders [CO 05/644], [CO 06/441], and [CO 10/654]. For example, entities that present consolidated financial statements must adhere to the rules for including financial statements of related registered schemes in a single document as per Class Order [CO 06/441]. Additionally, entities offering shares or interests under purchase plans must ensure that their disclosure documents meet the requirements set out in Class Order [CO 09/425], with certain conditional reliefs as varied by Class Order [CO 11/162]. Breaching the provisions of Class Order [CO 11/162] may result in various consequences, including administrative penalties. Under the Corporations Act, penalties for non-compliance can include fines and imprisonment, although specific penalties are not outlined in the explanatory statement. The exact penalties depend on the nature and severity of the breach, with potential civil and criminal consequences for serious violations. In summary, Class Order [CO 11/162] provides conditional relief from certain regulatory requirements for entities that comply with related class orders, but it mandates adherence to specific conditions and carries potential penalties for non-compliance. The order is designed to streamline reporting practices for certain financial products while ensuring entities remain within the regulatory framework.