ASIC Corporations (Amendment and Repeal) Instrument 2015/1079
Explanatory Statement
Prepared by the Australian Securities and Investments Commission
Corporations Act 2001
The Australian Securities and Investments Commission (ASIC) makes ASIC Corporations (Amendment and Repeal) Instrument 2015/1079 under subsection 257B(7), item 14(b) of the table in section 611, subsections 655A(1), 673(1) and 1020F(1) of the Corporations Act 2001 (the Act).
Operation of the Instrument
Repeal of class orders
ASIC Corporations (Amendment and Repeal) Instrument 2015/1079 repeals six class orders primarily relating to offers of Chapter 6 takeovers and schemes of arrangement. These class orders were due to sunset over the period 2016 to 2019 under the Legislative Instruments Act 2003.
All of the class orders repealed by ASIC Corporations (Amendment and Repeal) Instrument 2015/1079 have been remade following Consultation Paper 234 Remaking ASIC class orders on takeovers and schemes of arrangement Remaking ASIC class orders on offers of foreign securities (CP 234), which was published in August 2015 and is available on ASIC's website.
The list of ASIC legislative instruments that have been made to replace the class orders being repealed are as follows:
- ASIC Corporations (IDPS – Relevant Interests) Instrument 2015/1067 (previously Class Order [CO 04/523] Investor directed portfolio services takeover relief);
- ASIC Corporations (Minimum Bid Price) Instrument 2015/1068 (previously Class Order [CO 00/2338] Relief from the minimum bid price principle – s621(3));
- ASIC Corporations (Takeovers – Accelerated Rights Issues) Instrument 2015/1069 (previously Class Order [CO 09/459] Takeovers relief for accelerated rights issues);
- ASIC Corporations (Unsolicited Offers – Foreign Bids) Instrument 2015/1070 (previously Class Order [CO 05/850] Unsolicited offers under a regulated foreign bid); and
- ASIC Corporations (Approved Foreign Financial Markets) Instrument 2015/1071 (previously Class Order [CO 02/249] Approved overseas financial markets – s257B(7) and Class Order [CO 02/259] Downstream acquisitions: foreign stock markets).
Amendment of class orders
ASIC Corporations (Amendment and Repeal) Instrument 2015/1079 amends ASIC Class Order [CO 13/763] by omitting paragraph 16. ASIC Class order [CO 13/763] provides relief in several forms with respect to investor directed portfolio services. This instrument deletes paragraph 16 which referred to Class Order [CO 04/253].
Since Class Order [CO 04/253] is repealed by this instrument, the reference in paragraph 16 of Class Order [CO 13/763] is now redundant and can be omitted.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
ASIC Corporations (Amendment and Repeal) Instrument 2015/363
This legislative instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the legislative instrument
The purpose of this legislative instrument is to amend one class orders and repeal six class orders.
Human rights implications
This legislative instrument does not engage any of the applicable rights or freedoms.
Conclusion
This legislative instrument is compatible with human rights as it does not raise any human rights issues.
Overview
The ASIC Corporations (Amendment and Repeal) Instrument 2015/1079 was enacted to address the need to streamline and modernise the regulation of takeovers and schemes of arrangement within the Australian financial markets. This instrument, prepared by the Australian Securities and Investments Commission (ASIC), serves to repeal six class orders that were set to expire between 2016 and 2019, and to amend one existing class order. The policy objective behind this legislative action is to ensure that the regulatory framework remains current and effective, allowing for efficient and fair market practices while adapting to evolving market conditions and international standards. This instrument aligns with the overarching aim of the Corporations Act 2001 to protect investors and maintain market integrity by providing clear and consistent rules governing corporate activities.
Scope and Application
The ASIC Corporations (Amendment and Repeal) Instrument 2015/1079 pertains to the Corporations Act 2001 and applies to various entities within Australia, particularly those engaged in corporate activities such as takeovers, schemes of arrangement, and foreign securities offers. The instrument's scope includes the repeal of six existing class orders that were set to expire between 2016 and 2019, as well as the amendment of one class order to remove redundant references. These class orders cover areas like investor-directed portfolio services, relief from the minimum bid price principle, takeovers involving accelerated rights issues, unsolicited offers under a regulated foreign bid, and approved foreign financial markets. The instrument effectively updates and replaces the repealed class orders with new legislative instruments issued by ASIC, ensuring that the regulatory framework remains current and effective. The instrument does not specify any exclusions, exemptions, or thresholds, and its application is confined to the Australian jurisdiction.
Key Provisions
The ASIC Corporations (Amendment and Repeal) Instrument 2015/1079 amends and repeals several class orders primarily concerning offers of Chapter 6 takeovers and schemes of arrangement. Specifically, the instrument repeals six existing class orders (sections 2-3) and amends one class order (section 4). The repealed class orders, which were due to sunset between 2016 and 2019, have been replaced with new legislative instruments. These new instruments include the ASIC Corporations (IDPS – Relevant Interests) Instrument 2015/1067, ASIC Corporations (Minimum Bid Price) Instrument 2015/1068, ASIC Corporations (Takeovers – Accelerated Rights Issues) Instrument 2015/1069, ASIC Corporations (Unsolicited Offers – Foreign Bids) Instrument 2015/1070, and ASIC Corporations (Approved Foreign Financial Markets) Instrument 2015/1071. The amendment to Class Order [CO 13/763] involves the removal of a redundant reference to a repealed class order (section 4). These changes are intended to streamline and update the regulatory framework governing takeovers and schemes of arrangement.
The instrument imposes several obligations on the parties and entities it governs. It requires that the new legislative instruments replace the repealed class orders, ensuring that the updated regulations are in effect. Companies and other entities involved in takeovers and schemes of arrangement must comply with the new provisions outlined in the replacement instruments. This includes adhering to the new rules regarding investor directed portfolio services, minimum bid prices, accelerated rights issues, unsolicited offers under a regulated foreign bid, and approved foreign financial markets. By repealing and amending the class orders, the instrument aims to maintain regulatory consistency and effectiveness in the corporate sector.
Breaches of the provisions in this instrument may lead to civil or criminal consequences. While specific penalties are not detailed in the explanatory statement, penalties for breaches of corporate law provisions under the Corporations Act 2001 can be substantial. For corporations, penalties can include significant fines, up to the maximum limits prescribed by the Act. Individuals responsible for the breaches may also face fines and, in serious cases, imprisonment. The exact penalties depend on the specific nature and severity of the breach, but the intent is to ensure compliance with the updated regulatory requirements to protect investors and maintain market integrity.