Corporations Act 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

Note: This Chapter applies to a CCIV in a modified form: see Division 4 of Part 8B.7 .

PART 7.12 - MISCELLANEOUS  

Division 3 - Other matters  

SECTION 1101B   POWER OF COURT TO MAKE CERTAIN ORDERS  

Court ' s power to make orders in relation to certain contraventions

1101B(1)    
The Court may make such order, or orders, as it thinks fit if:

(a)    

on the application of ASIC, it appears to the Court that a person:

(i) has contravened a provision of this Chapter, or any other law relating to dealing in financial products or providing financial services; or

(ii) has contravened a condition of an Australian market licence, Australian CS facility licence, Australian derivative trade repository licence or Australian financial services licence; or

(iii) has contravened a provision of the operating rules, or the compensation rules (if any), of a licensed market; or

(iv) (Repealed)

(v) has contravened a condition on an exemption from the requirement to hold an Australian market licence or an Australian CS facility licence; or

(vi) is about to do an act with respect to dealing in financial products or providing a financial service that, if done, would be such a contravention; or

(aa)    

on the application of ASIC or the Reserve Bank or both, it appears to the Court that a person has contravened a provision of the operating rules of a licensed CS facility; or

(b)    on the application of a market licensee, it appears to the Court that a person has contravened the operating rules, or the compensation rules (if any), of a licensed market operated by the licensee; or

(c)    on the application of a CS facility licensee, it appears to the Court that a person has contravened a provision of the operating rules of a licensed CS facility operated by the licensee; or

(d)    

on the application of a person aggrieved by an alleged contravention by another person of subsection 798H(1) (complying with market integrity rules) or 981M(1) (complying with client money reporting rules) or a provision of the operating rules, or the compensation rules (if any), of a licensed market, or subsection 908CF(1) (complying with rules about financial benchmarks), it appears to the Court that:

(i) the other person did contravene the provision; and

(ii) the applicant is aggrieved by the contravention.

However, the Court can only make such an order if the Court is satisfied that the order would not unfairly prejudice any person.

Note: For examples of orders the Court could make, see subsection (4) .

1101B(2)    
For the purposes of paragraph (1)(d) , if a body corporate contravenes a provision of the operating rules of a licensed market, a person who holds financial products of the body corporate that are able to be traded on the licensed market is taken to be a person aggrieved by the contravention.

1101B(3)    
Subsection (2) does not limit the circumstances in which a person may be aggrieved by a contravention for the purposes of paragraph (1)(d) .

Examples of orders the Court may make

1101B(4)    
Without limiting subsection (1) , some examples of orders the Court may make under subsection (1) include:

(a)    

an order restraining a person from carrying on a business, or doing an act or classes of acts, in relation to financial products or financial services, if the person has persistently contravened, or is continuing to contravene:

(i) a provision or provisions of this Chapter; or

(ii) a provision or provisions of any other law relating to dealing in financial products or providing financial services; or

(iii) a condition on an Australian market licence, Australian CS facility licence, Australian derivative trade repository licence or Australian financial services licence; or

(iv) (Repealed)

(v) a condition of an exemption from a requirement to hold an Australian market licence or Australian CS facility licence; or

(vi) a provision of the operating rules, or the compensation rules (if any), of a licensed market or of the operating rules of a licensed CS facility; or

(b)    

an order giving directions about complying with a provision of the market integrity rules, of the derivative transaction rules, of the derivative trade repository rules or of the client money reporting rules, or a provision of the operating rules, or the compensation rules (if any), of a licensed market or of the operating rules of a licensed CS facility, or a provision of the financial benchmark rules or the compelled financial benchmark rules, to a person (or the directors of the body corporate, if the person is a body corporate) who contravened the provision; and

(c)    

an order requiring a person to disclose to the public or to specified persons, in accordance with the order, specified information that the person to whom the order is directed possesses or to which that person has access, if the person:

(i) contravened a provision of the market integrity rules, of the derivative transaction rules, of the derivative trade repository rules or of the client money reporting rules, or a provision of the operating rules of a licensed market, or a provision of the financial benchmark rules or the compelled financial benchmark rules, or a condition relating to the disclosure or provision of information; or

(ii) was involved in such a contravention; and

(d)    

an order requiring a person to publish advertisements in accordance with the order at that person ' s expense, if the person:

(i) contravened a provision of the market integrity rules, of the derivative transaction rules, of the derivative trade repository rules or of the client money reporting rules, or a provision of the operating rules of a licensed market, or a provision of the financial benchmark rules or the compelled financial benchmark rules, or a condition relating to the disclosure or provision of information; or

(ii) was involved in such a contravention; and

(e)    an order restraining a person from acquiring, disposing of or otherwise dealing with any financial products that are specified in the order; and

(f)    an order restraining a person from providing any financial services that are specified in the order; and

(g)    an order appointing a receiver of property (see subsection (9) ) of a financial services licensee; and

(h)    an order declaring a contract relating to financial products or financial services to be void or voidable; and

(i)    an order directing a person to do or refrain from doing a specified act, if that order is for the purpose of securing compliance with any other order under this section; and

(j)    any ancillary order considered to be just and reasonable in consequence of the making of an order under any of the preceding provisions of this subsection.

Interim orders

1101B(5)    
Before considering an application to the Court under subsection (1) , the Court may make an interim order of the kind applied for to apply pending the determination of the application, if in the opinion of the Court it is desirable to do so.

1101B(6)    
However, if ASIC, a market licensee or a CS facility licensee applies for an order under subsection (1) , the Court must not require the applicant, or any other person, to give any undertakings as to damages as a condition of making an interim order under subsection (5) .

Power to give notice of applications

1101B(7)    
Before making an order under subsection (1) , the Court may do either or both of the following:

(a)    direct that notice of the application be given to such persons as it thinks fit;

(b)    direct that notice of the application be published in such manner as it thinks fit.

Powers of receivers appointed under Court orders

1101B(8)    
A person appointed by order of the Court under subsection (1) as a receiver of the property (see subsection (12) ) of a financial services licensee:

(a)    may require the financial services licensee to:

(i) deliver to the person any property of which the person has been appointed receiver; or

(ii) give to the person all information concerning that property that may reasonably be required; and

(b)    may acquire and take possession of any property of which the person has been appointed receiver; and

(c)    may deal with any property that the person has acquired, or of which the person has taken possession, in any way in which the financial services licensee might lawfully have dealt with the property; and

(d)    has such other powers in respect of the property as the Court specifies in the order.

Duty to comply with order

1101B(10)    
A person must not, without reasonable excuse, contravene:

(a)    an order under this section; or

(b)    a requirement imposed under paragraph (8)(a) or (8)(d) by a receiver appointed by order of the Court under subsection (1) .

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

Power to rescind or vary order

1101B(11)    
The Court may rescind or vary an order made by it under this section or suspend the operation of such an order.

1101B(12)    

In this section:

compensation rules
(Repealed by No 76 of 2023, s 3, Sch 2 [ 564] (effective 20 October 2023).)

property
, in relation to a financial services licensee, includes:

(a) money; or

(b) financial products; or

(c) documents of title to financial products; or

(d) other property;

entrusted to, or received on behalf of, any other person by the financial services licensee or another person in the course of, or in connection with, a financial services business carried on by the financial services licensee.