Overview

ASIC Class Order [CO 14/23], enacted in 2014, is an instrument made by the Australian Securities and Investments Commission (ASIC) under section 1020F(1)(c) of the Corporations Act 2001. This class order aims to provide an extension of the interim relief provided by ASIC Class Order [CO 12/749], which had been temporarily excluding multifunds, superannuation platforms, and hedge funds from the shorter Product Disclosure Statement (PDS) regime. The background to this measure includes the introduction of a new shorter PDS regime for superannuation products and simple managed investment schemes by the Corporations Amendment Regulations 2010 (No 5), which was fully implemented on 22 June 2012. Given the complexity and specific nature of the financial products involved, ASIC Class Order [CO 14/23] extends the relief period by one year, until 30 June 2015, allowing more time for further government work on the application of the shorter PDS regime to these categories of financial products.

Scope and Application

The ASIC Class Order [CO 14/23] applies to multifunds, superannuation platforms, and hedge funds by temporarily exempting them from the shorter Product Disclosure Statement (PDS) regime mandated under the Corporations Regulations 2001. This class order extends the relief provided by Class Order [CO 12/749], which initially exempted these entities from the shorter PDS regime until 22 June 2014. The current class order further extends this exemption until 30 June 2015. The scope of this legislation is limited to financial entities and products within the superannuation and managed investment sectors, ensuring that the relief pertains specifically to these categories. The geographic reach of the Act is nationwide, affecting entities and financial products operating within Australia. The Act does not specify any exclusions or thresholds, but its application may be extended or restricted through subordinate instruments, such as further ASIC class orders or regulations.

Key Provisions

The ASIC Class Order [CO 14/23] under Section 1020F(1)(c) of the Corporations Act 2001 extends the relief provided by Class Order [CO 12/749]. This extension postpones the application of the shorter Product Disclosure Statement (PDS) regime for certain financial products until 30 June 2015, instead of the initially scheduled date of 22 June 2014. Specifically, Class Order [CO 14/23] excludes multifunds, superannuation platforms, and hedge funds from the shorter PDS regime during this extended period. The main operative sections involved are Sections 1020F(1)(c) and 1020F(2) of the Act, which allow ASIC to modify the application of specific provisions of the Act through class orders. Entities and parties governed by this Act, particularly those dealing with superannuation platforms, multifunds, and hedge funds, are subject to certain obligations and requirements. They must adhere to the extended relief period outlined in Class Order [CO 14/23], ensuring compliance with the stipulations until 30 June 2015. This includes preparing and disclosing the relevant information in accordance with the existing PDS regime rather than the shorter PDS regime. Furthermore, entities must ensure that all financial products within these categories comply with the regulatory framework provided by the Corporations Regulations 2001, while also preparing for the eventual application of the shorter PDS regime. The Act imposes potential penalties and consequences for non-compliance with the provisions set forth in the ASIC Class Order [CO 14/23]. While specific penalties are not detailed within the Class Order itself, breaches of the Corporations Act 2001 can lead to significant civil and criminal liabilities. These may include fines, imprisonment, or both, depending on the severity and nature of the breach. Additionally, entities found to be in non-compliance may face reputational damage, loss of licence, or other regulatory actions imposed by ASIC. The precise penalties would be determined based on the specific circumstances of the breach and the relevant sections of the Act that are contravened.