ASIC Corporations (Foreign Securities—Incidental Advertising) Instrument 2015/360

Overview

The ASIC Corporations (Foreign Securities – Incidental Advertising) Instrument 2015/360 was enacted under the authority of the Corporations Act 2001, with the objective of providing relief to authors and publishers who inadvertently publish advertisements or statements about foreign securities within Australia. This instrument was developed in response to the need for a more nuanced approach to the existing restrictions on advertising foreign securities, which were previously not specifically addressed in the Act’s exceptions. The Australian Securities and Investments Commission (ASIC), as the enacting body, sought to provide clarity and practical relief for publishers whose primary audience is outside Australia, ensuring that they are not unduly restricted by the Act when their content is only incidentally published in Australia. The policy objective is to balance the need for consumer protection with the realities of global media dissemination, thereby facilitating lawful and informative advertising while avoiding unnecessary burdens on foreign publishers.

Scope and Application

The ASIC Corporations (Foreign Securities – Incidental Advertising) Instrument 2015/360 applies to authors and publishers who incidentally publish advertisements or statements relating to foreign securities in Australia, providing relief from certain restrictions under the Corporations Act 2001. This relief is broader than the exceptions for news reports, and it applies to publications in print media, radio and television broadcasts, and electronic services operated on a commercial basis that are similar to newspapers, magazines, or broadcasts. The relief is available only if the author or publisher authorised the publication outside Australia. The instrument operates by declaring that specified provisions of the Corporations Act apply with modifications, allowing incidental advertising of foreign securities without breaching the general prohibitions on advertising or publishing statements that refer to offers of securities or financial products. This legislation has a national reach across Australia and applies to any person or entity involved in the specified types of publication. There are no stated exclusions, exemptions, or thresholds, but further regulatory guidance can be found in Section E of Regulatory Guide 72 Foreign securities: Disclosure relief (RG 72).

Key Provisions

The ASIC Corporations (Foreign Securities – Incidental Advertising) Instrument 2015/360 primarily provides relief under sections 741 and 1020F of the Corporations Act 2001 (the Act). This instrument allows for certain exemptions from the general prohibition on advertising foreign securities, which is found in subsection 734(2) and section 1018A of the Act. Specifically, the Instrument grants relief to authors and publishers who incidentally publish advertisements or statements about foreign securities in Australia, provided that the publication was authorised outside Australia (subsection 734(7) and 1018A(4)). This relief applies to various forms of media, including print, radio, television broadcasts, and electronic services similar to newspapers, magazines, or broadcasts. The obligations imposed by the Instrument on the parties it governs are primarily centred around ensuring that any advertisements or statements about foreign securities published in Australia are indeed incidental and authorised outside Australia. Authors and publishers must ensure that their publications meet the criteria set out in the Instrument to qualify for the relief it provides. They must also be aware of the types of media covered by the relief, including print, electronic, and broadcast media. The Instrument aims to strike a balance between allowing incidental publication of foreign securities information in Australia and preventing misleading or unauthorised advertising that could potentially harm investors. Failure to comply with the provisions of the ASIC Corporations (Foreign Securities – Incidental Advertising) Instrument 2015/360 may result in civil or criminal consequences under the Corporations Act 2001. Specifically, breaches of the Act’s advertising provisions can lead to substantial penalties. For corporations, the maximum penalty for contravening these sections can include fines of up to $1.65 million or three times the benefit obtained from the contravention, whichever is greater. For individuals, the maximum penalties can include fines of up to $330,000 or imprisonment for up to five years, or both, depending on the nature and severity of the breach. Additionally, ASIC may seek injunctions, compensation orders, or other remedies to address non-compliance, ensuring that the integrity of Australia's financial markets is maintained.