ASIC today released Consultation Paper 261 Remaking and repealing ASIC class orders on rights issue notifications and money market deposits (CP 261).
CP 261 outlines our proposals to remake a class order on rights issue notifications and repeal a class order on money market deposits. Both class orders are currently due to expire (‘sunset’) on 1 April 2017.
ASIC proposes to remake [CO 02/225] Rights issue notifications as, in our view, the class order is operating effectively and efficiently and continues to form a necessary and useful part of the legislative framework. The fundamental policy principles that underpin the class order have not changed.
The new instrument would continue the relief currently given by [CO 02/225] without significant changes, so that the ongoing effect will be preserved without any disruption to the entities that rely on it. However, ASIC is proposing to:
- remove the relief from s1021C of the Corporations Act that is currently given by the class order as we consider the relief is unnecessary; and
- amend the conditions of the class order to facilitate electronic access to documents.
The draft ASIC instrument, which reflects the amendments proposed in the consultation paper, is available on our website under CP 261.
ASIC also proposes to repeal [CO 00/231] Money market deposits as we consider the relief provided by the class order is no longer necessary in light of other provisions of the Corporations Act 2001. We consider that if there is any residual need for relief, it is more appropriately given on a case by case basis by application.
CP 261 outlines ASIC’s rationale for proposing to remake the relief in [CO 02/225] and repeal the relief in [CO 00/231].
Submissions on CP 261 are due by 15 July 2016.
Background
Under the Legislation Act 2003, all class orders are repealed automatically or ‘sunset’ after a specified period of time (mostly 10 years) unless we take action to exempt or preserve them. This ensures that legislative instruments like class orders are kept up to date and only remain in force while they are fit for purpose and relevant.