In an industry stakeholder meeting earlier this year, ASIC announced that it will undertake a review of compliance by unlisted disclosing entities with their disclosure obligations under the Corporations Act 2001 (Cth) (Act). In light of this review, ASIC will release stricter guidelines outlining obligations under the Act, along with likely further enforcement action.
Who is affected?
Entities affected are those considered to be unlisted disclosing entities under the Act. These include:
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companies which have issued securities under a prospectus or other disclosure document and the securities have been held by 100 or more persons at all items since the issue; and
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registered managed investment schemes with 100 or more members who hold interests in the scheme following an offer made under a product disclosure statement (PDS).
What are the obligations?
Currently, unlisted disclosing entities are required to adhere to 2 forms of disclosure (which are similar to those for listed entities):
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a system of continuous disclosure (for example lodging half-yearly and annual reports); and
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timely disclosure of “price sensitive information”, including information that:
ASIC has recognised that there is little guidance on the nature of “price sensitive information”, however, the reporting obligations are considered similar to those of listed entities under the Australian Securities Exchange (ASX).
Not all information outlined above is required to be disclosed. Exemptions include information which, is both confidential and not reasonably expected to be disclosed, and information which is either indefinite, or incomplete as part of a proposal or negotiation.
What you should do
ASIC is still undertaking its review in this area and the extent to which it will tighten its guidelines remains to be seen.
In the meantime, unlisted disclosing entities should make sure they are fully aware of their obligations in this area. We recommend unlisted disclosing entities draft and implement a continuous disclosure policy which sets out materiality thresholds and information which requires disclosure under the Act.
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If you would like assistance in complying with your corporate governance requirements, and in particular unlisted entities disclosure obligations, please contact:
Geoff Cairns
T: 61 2 8233 9570
E: geoff.cairns@dibbsbarker.com
The information in this document is provided for general guidance only. It is not legal advice, and should not be used as a substitute for consultation with professional legal or other advisors. No warranty is given to the correctness of the information contained in this document, or its suitability for use by you. To the fullest extent permitted by law, no liability is accepted by DibbsBarker for any statement or opinion, or for an error or omission or for any loss or damage suffered as a result of reliance on or use by any person of any material in the document.
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