ASIC has released new guidance explaining how it makes decisions about whether to become involved in private litigation and how it can assist private litigants by providing them with non-public documents and information.

Information Sheet 180 ASIC’s approach to involvement in private court proceedings

Information Sheet 180 outlines ASIC’s approach when deciding whether to become involved in private litigation including intervening as a party or applying to appear as amicus curiae or ‘friend of the court’, and beginning or continuing litigation on behalf of a party under section 50 of the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act).

ASIC indicates that a decision to intervene will be influenced by:

  • whether the intervention would be of strategic regulatory significance;
  • a cost-benefit analysis;
  • whether issues specific to the case warrant intervention (e.g. where ASIC has information or an argument relevant to proceedings but which would not be submitted by the parties to the proceedings); and
  • whether alternatives are available.

ASIC also indicates that the factors influencing a decision to bring civil proceedings under section 50 of the ASIC Act include whether:

  • ASIC has commenced a formal investigation into suspected misconduct;
  • proceedings would be in the public interest;
  • there are alternatives for recovery of damages or property; and
  • written consent has been given by a person on whose behalf proceedings are to be brought (although consent does not need to be (but generally will be) obtained where proceedings are brought on behalf of a company).

ASIC Regulatory Guide 4 Intervention is withdrawn as a result of the publication of Information Statement 180.

Information Sheet 181 Providing information and documents to private litigants

Information Sheet 181 explains when ASIC will provide non-public information and documents to private litigants, or people contemplating litigation and covers:

  • release of transcripts and books (including books compulsorily produced or seized under a notice or warrant) and the limitations that ASIC may impose;
  • responding to a subpoena or summons;
  • responding to a notice requiring non-party discovery or  a notice to produce; and
  • limitations on release of information or documents.

ASIC’s stated policy is to generally assist litigants by providing information and documents requested, subject to:

  • avoiding potential prejudice to its investigations;
  • any legal limitations on its ability to disclose confidential or private information; and
  • the rights of third parties affected by the provision of the information.

See ASIC’s media release dated 25 June 2013.