The Full Federal Court has dismissed an appeal by Provide Nominees Pty Ltd, trading as Provide Capital.
As part of an ongoing investigation, ASIC previously served a notice on Provide Capital to produce documents which Provide Capital failed to do. Provide must now comply with a notice ASIC issued to produce documents.
Section 33 of the ASIC Act allows ASIC to require the production of documents from a person, including a company. If a person fails to comply with such a request, under s70 of the ASIC Act, ASIC can certify that non-compliance to the Court and seek orders that the person produce documents as required by the notice.
Provide Capital alleged that ASIC failed to include the words ‘without reasonable excuse’ when certifying to the Court that Provide had failed to provide the documents.
ASIC alleged that under s70 of the ASIC Act, it was only required to certify Provide Capital's failure to produce documents and its action did not extend to certifying that the failure was 'without reasonable excuse'.
Justices Lee, Anderson and McElwaine determined that the orders previously made by Justice O’Bryan in the Federal Court are correct, dismissing Provide Capital’s appeal and ordering they pay ASIC’s costs.
Background
ASIC was concerned that Provide Capital failed to fully comply with an ASIC notice, including by producing some documents with portions redacted.
On 2 December 2022, ASIC commenced proceedings against Provide Capital seeking orders under s70 of the ASIC Act (22-343MR).
Section 70 of the ASIC Act allows ASIC to certify to the Court that a person failed to comply with a notice to produce and to seek orders that the person comply with that requirement.
On 25 September 2023 Justice O’Bryan ordered Provide Capital to produce the documents it failed to produce under ASIC’s notice to produce. When handing down his decision, Justice O’Bryan noted that the ‘evidence before the Court demonstrates a history of delay and obfuscation on the part of Provide in complying with the Notice. The most egregious example is the redaction of documents produced to ASIC.’ On 20 October 2023 Provide Capital appealed the decision.
ASIC’s investigation into Provide Capital continues.
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Editor's Note 1:
On 21 March 2024, Provide Nominees Pty Ltd filed an application for special leave to appeal to the High Court of Australia in relation to the Full Federal Court’s decision handed down on 22 February 2024.
Editor's Note 2:
On 28 March 2024, Provide Capital lodged an Interlocutory Application for orders staying order 1 of the Federal Court of Australia made on 25 September 2023 in ASIC v Provide Nominees Pty Ltd (VID712/2022) until Provide Capital’s application for special leave to appeal to the High Court of Australia (M26/2024) is determined. Order 1 requires Provide Capital to produce certain unredacted books to ASIC. ASIC opposed the stay application.
At the hearing on 3 April 2024, Provide Capital gave the court an undertaking that, in the event that their application for special leave to appeal to the High Court of Australia (M26/2024) is refused, the company will comply with order 1 by the next business day subsequent to the day on which the High Court of Australia publishes that decision.
On 3 April 2024, the Federal Court made the orders sought by Provide Capital to stay order 1 until determination of the special leave application and ordered ASIC to pay Provide Capital’s costs of the Interlocutory Application. Provide Capital’s undertaking has been noted in the court order.