ASIC has remade three class orders that were due to expire (‘sunset’) on 1 October 2023 under the Legislation Act 2003. The class orders are:
- [CO 13/655] – Provisions about the amount of consideration to acquire interests and withdrawal amounts not covered by ASIC Corporations (Managed investment product consideration) Instrument 2015/847;
- [CO 13/656] – Equality of treatment impacting on the acquisition of interests; and
- [CO 13/657] – Discretions affecting the amount of consideration to acquire interests and withdrawal amounts.
The new legislative instruments that replace these class orders will sunset on 1 October 2028. A summary of our consultation process is outlined below.
ASIC will also update Regulatory Guide 134 Funds Management: Constitutions shortly to reflect the release of the new instruments.
Responsible entities and equal treatment: [CO 13/519] and [CO 13/656]
On 21 March 2023, ASIC released Consultation Paper 368 Remaking ASIC class orders: [CO 13/519] and [CO 13/656], which proposed to remake the class orders in substantially the same form.
[CO 13/656] provides equal treatment relief to the responsible entity of a registered scheme and the corporate director of a retail corporate collective investment vehicle (CCIV) in various situations, including in relation to some offers of interests or shares to a member with a registered address outside Australia and New Zealand. [CO 13/656] also provides relief in relation to the responsible entity setting the issue price of forfeited interests in a registered scheme.
ASIC received one submission supporting the proposal to continue this relief, subject to an amendment to extend the equal treatment relief to the corporate director of a wholesale CCIV. A new instrument has been issued to remake [CO 13/656] to continue the relief on substantially the same terms and to extend the equal treatment relief to the corporate director of a wholesale CCIV.
The instrument for [CO 13/519] will be remade in substantially the same form in September 2023 as part of work related to Consultation Paper 365 Remaking ASIC class orders on takeovers, compulsory acquisitions and relevant interests.
ASIC has issued a new legislative instrument to remake [CO 13/656].
- ASIC Corporations (Equality of Treatment Impacting on the Acquisition of Scheme Interests and CCIV Shares) Instrument 2023/697
- Submission to CP 368
Unit pricing discretions for managed investment schemes: [CO 13/655] and [CO 13/657]
On 8 June 2023, ASIC consulted on remaking ‘sunsetting’ class orders on unit pricing discretions for managed investment schemes (refer 23-154MR), which proposed continuation of the relief provided under [CO 13/655] and [CO 13/657] on substantially the same terms. ASIC’s proposals included simplifying the requirements to document exercises of discretion that affect the pricing of interests and reduce the level of prescription.
ASIC received one submission, which was supportive of the proposals but decided not to adopt the minor changes suggested. The suggestion to amend the requirements for the sale of forfeited interests was not adopted because it would make these requirements inconsistent with the requirements for the sale of forfeited shares. The suggestion to simplify the transitional arrangements was not adopted because ASIC considered that the more robust transitional arrangements in the draft instrument were necessary and appropriate.
ASIC has issued a new legislative instrument to remake [CO 13/655] and [CO 13/657].
- ASIC Corporations (Discretions for Setting the Issue Price and Withdrawal Price of Interests in Managed Investment Schemes) Instrument 2023/693
- Non-confidential submission: Law Council of Australia (PDF 190 KB)
Under the Legislation Act 2003, all class orders are repealed automatically or ‘sunset’ after a period (usually 10 years), unless ASIC takes action to remake 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.
© Australian Securities and Investments Commission. Reproduced with permission.