ASIC is seeking feedback from companies, Australian financial services licensees (including responsible entities), members, creditors and insolvency practitioners on the proposals in Consultation Paper 223 - Relief for externally administered companies and registered schemes being wound up – RG 174. The proposals are designed to reduce business costs for insolvent or financially distressed companies or schemes, while recognising the information needs of members and creditors. Comments on the proposals are due by 20 October 2014, with the new guidance and relief due to be finalised by February 2015.
ASIC has released Consultation Paper 223 Relief for externally administered companies and registered schemes being wound up – RG 174 update and draft updated Regulatory Guide 174 Relief for externally administered companies and registered schemes being wound up, which propose changes to ASIC’s existing approach in granting relief to externally administered companies from certain financial reporting obligations and extending the time in which an externally administered public company must hold an AGM.
Key proposals on which ASIC is consulting include:
- providing a class order exemption from financial reporting obligations under the Corporations Act 2001 (Cth) (Act) for certain ‘insolvent’ registered schemes being wound up;
- providing a class order exemption from the obligation to hold an AGM to public companies that have a liquidator appointed;
- clarifying that the ASIC class order exemption for companies that have a liquidator appointed applies to providing outstanding financial reports as well as current obligations;
- providing a class order extension of time for the reporting obligations of Australian financial services licensees in Division 6 of Part 7.8 of the Act, subject to conditions;
- amending current class order exemptions to remove the ASIC notification condition for extensions of time under class order financial reporting relief and exclude AFS licensees from relying on class order exemptions for companies with a liquidator appointed;
- replacing individual exemptions with individual deferrals where it is not clear whether the company will continue in business; and
- providing guidance about a number of other potential relief applications, including relief for previously deferred financial reporting obligations and, for registered schemes, compliance plan audit relief.
Comments on CP 223 and the draft updated RG 174 are due on 20 October 2014. ASIC has indicated that it hopes to finalised the updated RG 147 and Class Order [CO 03/392] in February 2015.
See media release dated 25 August 2014.