ASIC Corporations (Repeal) Instrument 2016/171

EXPLANATORY STATEMENT for

ASIC Corporations (Repeal) Instrument 2016/171

Prepared by the Australian Securities and Investments Commission
 

Corporations Act 2001

The Australian Securities and Investments Commission (ASIC) makes ASIC Corporations (Repeal) Instrument 2016/171 under sections 283GA, 655A, 741 and 1020F of the Corporations Act 2001 (the Act).

This legislative instrument, which is an omnibus repeal instrument, repeals a number of class orders made by ASIC. A number of sources of power were used to make those class orders. As this instrument is revoking those class orders, the powers being exercised in this instrument  are the multiple sources of power used to make those other class orders.

1.          Background

ASIC has recently reviewed 31 class orders which relate primarily to the fundraising provisions in Chapter 6D of the Act. ASIC has decided to remake the relief found in 26 of those class orders, where that relief is considered to still be both necessary and appropriate. ASIC has decided to cease to provide the relief found in the remaining five class orders, where that relief is considered to be unnecessary.

The Legislation Act 2003 (the LA) provides for the periodic expiry of legislative instruments (‘sunsetting’) to ensure that they are kept up to date and only remain in force for as long as they are needed. The 31 class orders reviewed, being legislative instruments, were scheduled to eventually expire under the sunsetting provisions of the LA.

ASIC’s review of the policy underlying these class orders — and subsequent decision to reissue the relief (in the case of 26 class orders) or cease to provide the relief (in the case of five class orders) — has provided an opportunity to deal with this imminent expiry and ensure that the relevant relief will continue to be available.

2.             Purpose of the instrument

The purpose of ASIC Corporations (Repeal) Instrument 2016/171 is to repeal, in a single instrument, 31 class orders which relate primarily to the fundraising provisions in Chapter 6D.

The relief found in 26 of those class orders is remade in 13 new legislative instruments.

The relief found in the following 5 class orders will no longer be provided:

(a) Class Order [CO 00/167] Relief from exposure period: profile statements;

(b) Class Order [CO 00/177] Fundraising exemption: NZ prospectuses;

(c) Class Order [CO 00/222] Employee share schemes—miscellaneous fundraising relief;

(d) Class Order [CO 00/229] Solicitors mortgage investment companies; and

(e) Class Order [CO 00/238] Dividend reinvestment plans.

3.             Operation of the instrument

ASIC Corporations (Repeal) Instrument 2016/171 repeals the 31 class orders specified in the schedule to that instrument.

4.             Consultation

On 17 September 2015 ASIC released CP 239 Disclosure documents: Update to ASIC instruments and guidance (CP 239) seeking feedback on proposals to update and consolidate a number of regulatory guides relating primarily to Chapter 6D of the Act. CP 239 referred to the expiry of class orders scheduled to eventually sunset under the LA and also sought feedback on proposals to reissue the legislative instruments associated with ASIC’s updated guidance and to make legislative instruments addressing some discrete policy issues. The consultation period closed on 27 November 2015.

ASIC received four submissions in response to CP 239. Details of the submissions are contained in REP 473 Response to submissions on CP 239 Disclosure documents: updates to ASIC instruments and guidance which is available on ASIC’s website at www.asic.gov.au.

Following the consultation, ASIC decided to proceed to reissue the class orders as proposed by CP 239.  Notwithstanding the consultation, ASIC considers that ASIC Corporations (Repeal) Instrument 2016/171  is of a minor or machinery nature and, having regard to the contemporaneous reissuing of the class orders,  does not substantially alter existing arrangements.