ASIC Class Order [CO 12/574]

Overview

The ASIC Class Order [CO 12/574], enacted under the Corporations Act 2001, was introduced to address the redundancy of previous legislation that had become obsolete. This class order was made by the Australian Securities and Investments Commission (ASIC), an entity established by the Commonwealth Government to regulate financial markets and ensure compliance with financial services laws. The primary objective of this class order was to revoke the Class Order [CO 00/184], which had provided conditional relief from disclosure obligations under Chapter 6D of the Corporations Act 2001 for Australian issuers of interests in managed investment schemes in New Zealand. Given that Chapter 6D ceased to apply to interests in registered schemes in March 2004, the previous relief had not been operational since then, making the revocation necessary. ASIC did not undertake specific consultation for this class order due to its minor and administrative nature.

Scope and Application

The ASIC Class Order [CO 12/574] applies to the responsible entities of registered schemes and concerns the relief from disclosure obligations under Chapter 6D of the Corporations Act 2001. Specifically, it revokes the previously applicable Class Order [CO 00/184] which had provided conditional relief to Australian issuers of interests in managed investment schemes in New Zealand, allowing them to act on application monies received from New Zealand investors, provided the investment statement complied with New Zealand legislation. The revocation of the previous class order is due to the cessation of Chapter 6D’s application to interests in registered schemes in March 2004, rendering the previous relief no longer practical. This class order is made under the Corporations Act 2001 and applies on a national level across Australia, although its primary relevance is to entities dealing with investments in New Zealand. ASIC did not undertake specific consultation for this class order due to its minor and administrative nature. Furthermore, the class order is compatible with human rights as it does not engage any applicable rights or freedoms under the Human Rights (Parliamentary Scrutiny) Act 2011.

Key Provisions

The ASIC Class Order [CO 12/574], made under the Corporations Act 2001, primarily serves to revoke the previous Class Order [CO 00/184], which provided relief to Australian issuers of interests in managed investment schemes in New Zealand from certain disclosure obligations under Chapter 6D of the Act. The relief previously allowed issuers to act on application monies received from New Zealand investors relating to a New Zealand investment statement that complied with New Zealand legislation. This relief was contingent upon certain conditions being met, but since Chapter 6D ceased to apply to interests in registered schemes in March 2004, the previous class order has had no practical operation. The main operative sections of this class order focus on revoking the outdated relief and updating the regulatory framework to reflect current legislative changes. This ensures that the regulatory environment remains relevant and effective, aligning with the current legal standards and practices. The revocation of Class Order [CO 00/184] signifies that the relief it provided is no longer necessary or applicable, thereby simplifying and streamlining the regulatory requirements for issuers of interests in managed investment schemes. The obligations and requirements imposed by this Act on the parties it governs primarily revolve around ensuring compliance with the current legal standards. Issuers of interests in managed investment schemes must now adhere to the full disclosure obligations under Chapter 6D, as the previous relief no longer applies. This ensures that investors are provided with adequate and timely information, thereby promoting transparency and protecting their interests. The Act requires issuers to maintain compliance with all relevant provisions of the Corporations Act, including those related to disclosure, to maintain the integrity of the investment market. The class order does not introduce new offences or penalties; rather, it removes outdated regulatory relief, thereby ensuring that the enforcement framework is up to date and aligned with the current legal environment. By revoking Class Order [CO 00/184], the Act helps to avoid any confusion or non-compliance that might arise from the application of obsolete provisions. The penalties for breaches of the Corporations Act, including those related to disclosure requirements, remain as specified in the Act, which can include fines and imprisonment for serious or repeated breaches. The exact penalties depend on the specific nature and severity of the breach.