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 7.10 - MARKET MISCONDUCT AND OTHER PROHIBITED CONDUCT RELATING TO FINANCIAL PRODUCTS AND FINANCIAL SERVICES  

Division 2 - The prohibited conduct (other than insider trading prohibitions)  

SECTION 1041H   MISLEADING OR DECEPTIVE CONDUCT (CIVIL LIABILITY ONLY)  

1041H(1)    
A person must not, in this jurisdiction, engage in conduct, in relation to a financial product or a financial service, that is misleading or deceptive or is likely to mislead or deceive.

Note 1: Failure to comply with this subsection is not an offence.

Note 2: Failure to comply with this subsection may lead to civil liability under section 1041I . For limits on, and relief from, liability under that section, see Division 4 .

1041H(2)    
The reference in subsection (1) to engaging in conduct in relation to a financial product includes (but is not limited to) any of the following:

(a)    dealing in a financial product;

(b)    

without limiting paragraph (a) :

(i) issuing a financial product;

(ii) publishing a notice in relation to a financial product;

(iii) making, or making an evaluation of, an offer under a takeover bid or a recommendation relating to such an offer;

(iv) applying to become a standard employer-sponsor of a superannuation entity;

(v) permitting a person to become a standard employer-sponsor of a superannuation entity;

(vi) a trustee of a superannuation entity dealing with a beneficiary of that entity as such a beneficiary;

(vii) a trustee of a superannuation entity dealing with an employer-sponsor or an associate (within the meaning of the Superannuation Industry (Supervision) Act 1993 ) of an employer-sponsor, of that entity as such an employer-sponsor or associate;

(viii) applying, on behalf of an employee (within the meaning of the Retirement Savings Accounts Act 1997 ), for the employee to become the holder of an RSA;

(ix) an RSA provider dealing with an employer (within the meaning of the Retirement Savings Accounts Act 1997 ), or an associate (within the meaning of that Act) of an employer, who makes an application, on behalf of an employee (within the meaning of that Act) of the employer, for the employee to become the holder of an RSA, as such an employer;

(x) carrying on negotiations, or making arrangements, or doing any other act, preparatory to, or in any way related to, an activity covered by any of subparagraphs (i) to (ix) .

1041H(3)    

If a person engages in conduct:

(a)    

that contravenes:

(i) section 670A (misleading or deceptive takeover document); or

(ii) section 728 (misleading or deceptive fundraising document); or

(iia) section 738Y (other liabilities relating to defective CSF offer documents); or

(iii) section 1021NA or 1021NB ; or

(b)    in relation to a disclosure document or statement within the meaning of section 953A ; or

(c)    in relation to a disclosure document or statement within the meaning of section 1022A ;

the person ' s engaging in that conduct does not contravene subsection (1) of this section.

1041H(4)    

If a disclosing entity engages in conduct that:

(a)    does not contravene subsection 674A(2) , but would contravene that subsection if paragraph 674A(2)(d) contained the same text as paragraph 674(2)(d) ; or

(b)    does not contravene subsection 675A(2) , but would contravene that subsection if paragraph 675A(2)(b) contained the same text as paragraph 675(2)(b) ; or

the disclosing entity ' s engaging in that conduct does not contravene subsection (1) of this section.

Note: The subsections mentioned in paragraphs (a) and (b) deal with continuous disclosure of information by disclosing entities.

1041H(5)    

For the purposes of subsections (3) and (4) , a person or disclosing entity engages in conduct that contravenes a provision even if engaging in the conduct does not constitute an offence, or lead to a liability, because of the availability of a defence.