Following several months of public consultation, the ASX has now released the final changes to the continuous disclosure rules for listed entities. These changes relate to both the Listing Rules 3.1 – 3.1B but more substantially the ASX Guidance Note 8 on the topic.
This is the first revision of ASX Guidance Note 8 since 2005 and therefore takes into account disclosure issues which emerged during the global financial crisis and various court rulings, including High Court rulings. As all of this has resulted in such a major revision of Guidance Note 8, it has tripled in size to 78 pages. Fortunately for busy executives, the ASX has also released an abridged version of the Guidance Note with only 15 pages.
Key points to note
Importantly, these changes to the ASX continuous disclosure rules highlight:
- while the fundamental principles of continuous disclosure in Listing Rules 3.1 – 3.1B have not changed, ASX now provides much needed clarification and numerous examples of what they expect about a whole range of continuous disclosure issues stemming from these Listing Rules;
- as ASIC also regulates continuous disclosure under the Corporations Act, and acts as enforcer of the ASX listing rules, the updated ASX Guidance Note also reflects ASIC’s expectations of listed entities in this area;
- a number of (minor) consequential changes have been made to Listing Rule 3.1 – 3.1B plus other associated Listing Rules and ASX Guidance Notes; and
- the changes are due to come into effect from 1 May 2013.
What does ASIC think?
As part this ASX release, ASIC has taken the opportunity:
- to remind listed entities of the importance to market integrity of the continuous disclosure regime, which it co-regulates;
- to emphasise the need to have the “right systems” in place, particularly given the increasing prevalence of social media and the instant sharing of information; and
- to stress that this updated ASX Guidance Note be carefully considered, so that “appropriate processes” can be adopted to minimise the risk that ASIC will seek to take continuous disclosure enforcement action against non-complying entities. For more information, see ASIC welcomes updated guidance on continuous disclosure.
Action by Listed Entities
As these updated continuous disclosure rules are scheduled to start on 1 May 2013, all listed entities would be wise to review and update their continuous disclosure policies so as to ensure they have the “right systems” and “appropriate processes” in place to mitigate the risk of non-compliance. If you have not already done so, now is the time.
How can CompliSpace help?
If you require assistance with reviewing and updating your continuous disclosure policy, please contact CompliSpace via our contact details below.
CompliSpace clients who have subscribed to our ASX corporate governance policies will be receiving an update to their continuous disclosure policy.
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