Stop orders

A stop order is an administrative mechanism that allows ASIC to prevent offers being made under a disclosure document where we believe any of the following situations exist:

• the disclosure document contains a misleading or deceptive statement
• the disclosure document contains an omission of information required to be provided under the legislation, or
• a new circumstance has arisen since the disclosure document was lodged.

To use a stop order, we must also believe that the situation is materially adverse from the point of view of the investor. For more information see Regulatory Guide 254 Offering securities under a disclosure document (RG 254).

If we impose a stop order on your disclosure document, your company is not allowed to offer, issue, sell or transfer securities offered under the disclosure document while that order is in force. An interim stop order may be made for up to 21 days, during which time a hearing must be held to give your company a chance to put its views to an independent delegate. After the hearing we may lift the interim stop order or place a final stop order on the disclosure document.

More information about how ASIC conducts administrative hearings.