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ASIC Class Order [CO 04/523]

Authoritative Version
CO 04/523 Orders/ASIC Class Orders as amended, taking into account amendments up to ASIC Class Order [CO 04/613]
This Class Order modifies section 609 of the Corporations Act 2001 so that the operator, and persons involved in the operation, of an investor directed portfolio service (IDPS) do not have a relevant interest in securities held through the IDPS. This Class Order only applies where the relevant persons are able to rely on the relief in ASIC Class Order [CO 02/294] in relation to the IDPS.
Administered by: Treasury
Registered 13 Dec 2006
Start Date 09 Jun 2004
End Date 30 Jun 2013
Date of repeal 15 Dec 2015
Repealed by ASIC Corporations (Amendment and Repeal) Instrument 2015/1079

ASIC Class Order [CO 04/523]

Investor directed portfolio services takeovers relief

This instrument was made under subsections 655A(1) and 673(1) of the Corporations Act 2001.

This compilation was prepared on 2 August 2006 taking into account amendments up to [CO 04/613].

Prepared by the Australian Securities and Investments Commission.

Australian Securities and Investments Commission
Corporations Act 2001 — Subsections 655A(1) and 673(1) — Declaration

Under subsections  655A(1) and  673(1) of the Corporations Act 2001 (the “Act”) the Australian Securities and Investments Commission declares that Chapters 6 and 6C of the Act apply to the class of persons described in Schedule A, in the case referred to in Schedule B, as if section  609 of the Act were modified or varied by inserting after subsection 609(10) the following subsections:

“(11)       A person does not have a relevant interest in securities merely because the person:

(a)   is the operator of an IDPS; or

(b)   is involved in the operation of an IDPS and is a financial services licensee or a representative of a financial services licensee;

         and under the terms of the IDPS:

(c)   holds the securities; or

(d)   has a discretion in relation to the disposal of the securities.

 (12) Subsection (11) does not apply to:

(a)   the operator of an IDPS where it is unable to rely on an exemption granted under the IDPS Class Order because it has failed to comply with, failed to take reasonable steps to comply with, or has reasonable grounds to believe that it has not complied with, a condition of that Class Order as the circumstances require; or

(b)   a person referred to in paragraph (11)(b) if the person has knowingly caused or procured the operator or any person who holds property to which the IDPS relates to breach a condition of the IDPS Class Order.

(13) In subsections (11) and (12) and in this subsection:

          IDPS means an investor directed portfolio service, consisting of a number of functions including a custody, settlement and reporting system and service with the following features:

(a)        the clients of the service have the sole discretion to decide what (but not necessarily when) assets will be acquired or disposed of, except where:

(i)         there are any prior written directions to acquire or dispose of a particular asset in particular circumstances that the client has agreed not to vary (other than on the exercise of any discretion on the part of an operator); or

(ii)        the client has authorised the operator or another person to give directions on their behalf, for the purpose of the other person receiving or securing payment of moneys owing by the client to the person; and

(b)        subject to any prior contrary directions in order to ensure payment of moneys for which the client is liable, a client may direct the operator to:

(i)         take reasonable steps to transfer assets to or to the order of the client;

(ii)        realise assets held on account for the client and either:

(A)       pay the proceeds to or to the order of the client; or

(B)       if the operator and the client agree, hold the proceeds under the service in an account with an Australian ADI designated as a trust account,

                unless the assets cannot be transferred or realised under law or the terms of their issue; and

(c)        except where otherwise mentioned in paragraph (a) or (b), any discretion of the holder of assets held through the service may be exercised only in accordance with the directions from time to time of the relevant client; and

(d)        the service is provided in such a way that clients are led to expect, and are likely to receive, benefits in the form of:

(i)         access to investments that the client could not otherwise access directly; or

(ii)        cost reductions by using assets contributed by the client or derived directly or indirectly from assets contributed by the client with assets contributed by other clients or derived directly or indirectly from assets contributed by other clients.

                IDPS Class Order means the instrument issued under paragraphs 601QA(1)(a), 741(1)(a), 922B(1)(a) and 1020F(1)(a) dated 11 March 2002 known as ASIC Class Order [CO 02/294] or any instrument that replaces that Class Order.

                operator means a holder of a financial services licence that includes a condition requiring the holder to comply with the requirements of the IDPS Class Order who contracts with a client for the provision of the IDPS or a function that forms part of the IDPS.”.

SCHEDULE A

An operator, or a person involved in the operation, of an IDPS.

SCHEDULE B

The calculation of the relevant interests, voting power or substantial holdings of a person in the class of persons described in Schedule A.

Interpretation

In this instrument, IDPS and operator have the meanings given by notional subsection  609(13) set out above.

 

 

Notes to ASIC Class Order [CO 04/523]

Note 1

ASIC Class Order [CO 04/523] (in force under subsections 655A(1) and 673(1) of the Corporations Act 2001) as shown in this compilation comprises that Class Order amended as indicated in the Tables below.

Table of Instruments

Instrument number

Date of making or FRLI registration

Date of commencement

Application, saving or transitional provisions

[CO 04/523]

17/5/2004

17/5/2004

-

[CO 04/613]

9/6/2004

9/6/2004

-

Table of Amendments

ad. = added or inserted     am. = amended     rep. = repealed     rs. = repealed and substituted

Provision affected

How affected

Para (11)(b)

am. [CO 04/613]

Paras (11)(c) and (d)

ad. [CO 04/613]