Corporations Act 2001

CHAPTER 6D - FUNDRAISING  

PART 6D.4 - ASIC'S POWERS  

SECTION 739   ASIC STOP ORDERS  
Power to make orders

739(1)    

This section applies if ASIC is satisfied that:

(a)    information in a disclosure document lodged with ASIC is not worded and presented in a clear, concise and effective manner (see section 715A ); or

(b)    an offer of securities under a disclosure document lodged with ASIC would contravene section 728 ; or

(c)    an advertisement or publication of a kind referred to in subsection 734(5) or (6) that relates to securities is defective (see subsection (6) of this section); or

(d)    

an offer of securities under a CSF offer document, or the publication of a CSF offer document on a platform of a CSF intermediary, contravenes subsection 738Y(1) (which relates to defective CSF offer documents); or

(e)    

a CSF offer document does not comply with section 738K (other requirements for CSF offer documents); or

(f)    

an advertisement or publication of a kind referred to in subsection 738ZG(6) is defective (see subsection (6) of this section); or

(g)    

an offer of securities that is expressed to be made under Part 6D.3A is not eligible to be made under that Part.

739(1A)    

ASIC may order that:

(a)    

if paragraph (1)(a), (b), (d), (e) or (g) applies - no offers, issues, sales or transfers of the securities be made while the order is in force; or

(b)    

if paragraph (1)(c) or (f) applies - specified conduct in respect of the securities to which the advertisement or publication relates must not be engaged in.

739(1B)    

An order under paragraph (1A)(b) may include a statement that specified conduct engaged in contrary to the order will be regarded as not complying with the requirements of a specified provision of this Chapter.

739(2)    

Before making an order under subsection (1A), ASIC must:

(a)    hold a hearing; and

(b)    give a reasonable opportunity to any interested people to make oral or written submissions to ASIC on whether an order should be made.

739(3)    

If ASIC considers that any delay in making an order under subsection (1A) pending the holding of a hearing would be prejudicial to the public interest, ASIC may make an interim order that no offers, issues, sales or transfers of the securities be made while the interim order is in force. The interim order may be made without holding a hearing and lasts for 21 days after the day on which it is made unless revoked before then.

739(4)    

At any time during the hearing, ASIC may make an interim order that no offers, issues, sales or transfers of the securities be made while the interim order is in force. The interim order lasts until:

(a)    ASIC makes an order under subsection (1A) after the conclusion of the hearing; or

(b)    the interim order is revoked;

whichever happens first.

739(5)    

An order under subsection (1A), (3) or (4) must be in writing and must be served on the person who is ordered not to offer, issue, sell or transfer securities under the disclosure document.

Defective advertisements or statements

739(6)    

For the purposes of this section, an advertisement or publication of a kind referred to in subsection 734(5) or (6) , or 738ZG(6) , is defective if:

(a)    there is a misleading or deceptive statement in the advertisement or publication; or

(b)    there is an omission from the advertisement or publication of material required by the relevant subsection to be included in the advertisement or publication; or

(c)    

in the case of an advertisement or publication of a kind referred to in subsection 734(5) that relates to an offer of securities in a class that is not already quoted, and is published before a disclosure document in relation to the offer is lodged - the advertisement or publication includes material that is not referred to in paragraph 734(5)(b) .

Forecasts and other forward-looking statements

739(7)    

For the purposes of the definition of defective in subsection (6), a person is taken to make a misleading statement about a future matter (including the doing of, or refusing to do, an act) if they do not have reasonable grounds for making the statement.

739(8)    

Subsection (7) does not limit the circumstances in which a statement may be misleading.

SECTION 740   ANTI-AVOIDANCE DETERMINATIONS  

740(1)    
ASIC may determine in writing that a number of different bodies are closely related and that their transactions should be aggregated for the purposes of this Chapter. If ASIC does so:

(a) an issue, sale or transfer of securities in any other bodies is taken to also be an issue, sale or transfer of the securities of each of the other bodies by those bodies; and

(b) any money received from an issue, sale or transfer of securities in any of the bodies is taken to also be received by each of the other bodies from an issue, sale or transfer of its own securities; and

(c) for the purpose of subsection 738H(2) , assets or revenue of any of the bodies are taken also to be assets or revenue of each of the other bodies.

ASIC must give written notice of the determination to each of the bodies.

740(2)    
ASIC may determine in writing that the transactions of a body and of a person who controls the body should be aggregated for the purposes of this Chapter. If ASIC does so:

(a) an issue of securities in the body is taken to also be the transfer of the securities by the controller; and

(b) any money received from an issue of securities in the body is taken to also be received by the controller from a transfer of the securities; and

(c) a sale or transfer of securities in the body by the controller is taken to also be the issue of the securities by the body; and

(d) any money received from a sale or transfer of securities in the body by the controller is taken to also be received by the body from an issue of the securities; and

(e) for the purpose of subsection 738H(2) , assets or revenue of the body are taken also to be assets or revenue of the controller.

ASIC must give written notice of the determination to the body and the controller.

SECTION 741   ASIC'S POWER TO EXEMPT AND MODIFY  

741(1)    
ASIC may:

(a) exempt a person from a provision of this Chapter; or

(b) declare that this Chapter applies to a person as if specified provisions were omitted, modified or varied as specified in the declaration.

741(2)    
The exemption or declaration may do all or any of the following:

(a) apply to all or specified provisions of this Chapter;

(b) apply to all persons, specified persons or a specified class of persons;

(c) relate to all securities, specified securities or a specified class of securities;

(d) relate to any other matter generally or as specified.

741(3)    
An exemption may apply unconditionally or subject to specified conditions. A person to whom a condition specified in an exemption applies must comply with the condition. The Court may order the person to comply with the condition in a specified way. Only ASIC may apply to the Court for the order.

741(4)    
The exemption or declaration must be in writing and ASIC must publish notice of it in the Gazette .

741(5)    
For the purposes of this section, the provisions of this Chapter include:

(a) regulations made for the purposes of this Chapter; and

(b) definitions in this Act or the regulations as they apply to references in:

(i) this Chapter; or

(ii) regulations made for the purposes of this Chapter; and

(c) the old Division 12 of Part 11.2 transitionals.