ASIC has today released a consultation paper proposing to remake two class orders that are due to expire (‘sunset’) on 1 April 2017. The class orders affect financial reporting by small proprietary companies controlled by a foreign company and by registered foreign companies.
The class orders proposed to be remade are:
- Class Order [CO 98/98] Small proprietary companies which are controlled by a foreign company but which are not part of a large group in Australia
- Class Order [CO 02/1432] Registered foreign companies: financial reporting requirements.
Consultation Paper 248 Remaking ASIC class orders on reporting by foreign entities: [CO 98/98] and [CO 02/1432] (CP 248) proposes that they be remade as a single legislative instrument.
ASIC proposes to remake these class orders as, in our view, they are operating effectively and efficiently, and continue to form a necessary and useful part of the legislative framework.
The remade instrument preserves the existing relief with one substantive change upon which comment is specifically sought. Under the proposed change, ASIC will have the ability to give notice to an individual entity that it may not rely on the relief. In giving such notice, ASIC may have regard to information provided to it by the Australian Taxation Office or other regulators.
Each class order has been redrafted using ASIC’s current style and format, while preserving the current effect of the instrument. The draft ASIC instrument, which reflects the amendments proposed in the consultation paper, is available on our website at www.asic.gov.au/cp under CP 248.
Submissions on CP 248 are due on 29 February 2016.
Download CP 248 and draft instrument
Background
Under the Legislative Instruments Act 2003, all class orders are repealed automatically or ‘sunset’ after a specified period of time (mostly 10 years) unless we take action to exempt or preserve them.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.
Where an instrument is considered to be operating effectively and efficiently and still serves a regulatory purpose we will consult on remaking it even if there will be no significant changes.