As previously reported, in late 2012, the Australia Securities and Investment Commission ("ASIC") informally expressed that it does not consider RSUs and SARs the equivalent of "nil price" stock options, but instead as financial derivatives. This meant that most of the self-executing exemptions, as well as the Class Order 03/184 exemption from the prospectus disclosure requirement arguably were no longer available for RSUs/SARs.

On November 13, 2013, ASIC issued a consultation paper in which it describes its proposal for a revised Class Order exemption which would cover RSUs and SARs. The consultation period during which the public can provide comments on ASIC's proposals will close on January 31, 2014, and ASIC expects to issue the revised rules by May 2014.

We are currently reviewing the consultation paper and, together with our Sydney office, will issue a more detailed client alert describing ASIC's proposal shortly. In addition, we intend to provide comments to ASIC to lobby against certain restrictions in the proposal which we consider to be unduly restrictive for our clients.

In the meantime, for companies that will grant RSUs or SARs before May 2014 and have not yet obtained specific relief, we recommend that you speak to your GES attorney to determine the best course of action.

For companies that have already obtained specific relief for their RSU/SAR grants, no further action should be required at least until the revised rules are issued. It is likely that the specific relief will remain applicable even after issuance of the revised rules, but we can confirm this only when the revised rules are final.