Allens

Banks & Financial Institutions

Our experienced Banking & Financial Services legal team regularly publishes articles and updates – the full list of publications appears below. These publications provide a snapshot of the latest legislation, court cases, policy changes and contentious issues. If you'd like to be notified when we add new publications to the site, please go to our subscription page to sign up for email alerts or, alternatively, you can subscribe to our RSS feed.

For publications in other legal areas see our recent publications page.

Banks & Financial Institutions Publications

  • Client Update: The end of the unit trust monopoly - tranche 1 of the revised CCIV bill

    15 June 2018

    On 13 June 2018, the Federal Government released the first tranche of the revised exposure draft legislation for the new corporate collective investment vehicle, one of the two forms of collective investment vehicle which it pledged to develop as part of the 2016-2017 budget. We are undertaking a comprehensive review of the draft for the purpose of preparing submissions to Treasury and will provide further updates in due course. In the meantime, Partner Penny Nikoloudis, Senior Overseas Practitioner James Kanabar and Associate Mai Go provide a high-level overview of the draft.

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  • Client Update: ASIC overhauls AFS licensing relief for foreign financial service providers

    5 June 2018

    The Australian Securities and Investments Commission has released its highly anticipated consultation paper on licensing relief for foreign financial services providers. The said new licensing regime will be broadly in line with that applied to other AFS licensees, but with relief from some provisions of the Australian Corporations Act and the imposition of certain additional tailored licence conditions. Partner Penny Nikoloudis, Senior Associate Jo Ottaway and Law Graduate Tom Lawson report.

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  • Allens insights: International Comparative Legal Guide to Project Finance 2018 - Australia

    25 May 2018

    Partners Ben Farnsworth and Michael Ryan outline the main trends and significant developments in Australian project finance. Among other factors, they discuss restrictions on foreign investment, bankruptcy and restructuring proceedings, tax, and political risk in relation to changes in law.

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  • Unravelled: 2018-19 Federal Budget - superannuation

    15 May 2018

    The 2018-19 Federal Budget has introduced a number of proposed superannuation-related changes, with a focus on protecting small balances, young members and existing retirees.

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  • Unravelled: Breach reporting by AFS licensees

    15 May 2018

    In the hurly burly of the Royal Commission’s recent hearings concerning financial advice, you may have missed some very important information about breach reporting by AFS licensees contained in the witness statement prepared by Mr Peter Kell, Deputy Chair of ASIC.

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  • Unravelled: Royal Commission update

    15 May 2018

    The hearings in the Financial Services Royal Commission have been compulsory viewing, not only for financial services industry participants and their regulators and professional service providers. The hearings have exposed wide-ranging actual or alleged wrongful conduct that has captured the attention of politicians, media and the general public.

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  • Focus: Federal Government's bold vision for data availability and use

    4 May 2018

    The Federal Government's response to the Productivity Commission's report on data availability and use, released this week, outlines a bold vision but has a surprising lack of detail, suggesting implementation is likely to be some way off. If legislation is introduced, the new regime will result in a fundamental change to the way Australian consumers, businesses and government agencies interact with and think about data. Partner Gavin Smith, Senior Associate Jessica Selby and Lawyer Claudia Hall predict the key impacts.

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  • Pulse: Cyber security

    3 May 2018

    In this bulletin, we give you the rundown on proposed reforms to encryption laws; offer a practical guide to cyber insurance; look at APRA's proposal for a cross-industry framework for information security; give tips for fostering a culture of cyber awareness; examine the key findings from the OAIC's first quarterly report under the new Notifiable Data Breaches Scheme; and look at the steps that governments at home and abroad are taking to combat the growing risk of cyber attacks on critical infrastructure.

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  • Focus: ASIC's sanctions and powers to be strengthened

    23 April 2018

    The Federal Government has announced that it proposes to strengthen ASIC's powers, and to increase the severity of penalties (civil and criminal) that can be imposed on individuals and corporations, in line with the ASIC Enforcement Review Taskforce's recommendations. Partner Rachel Nicolson and Senior Overseas Practitioner Chris Kerrigan report.

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  • Unravelled: Draft code of ethics for financial advisers - in need of much more work

    9 April 2018

    You would be hard pressed to find a bigger load of nonsense than the draft code of ethics for financial advisers issued recently by the Financial Adviser Standards and Ethics Authority.

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  • Unravelled: CCIVs: lost in translation?

    9 April 2018

    The long-awaited Exposure Draft containing the tax treatment of the proposed new corporate collective investment vehicle (CCIV) was released for consultation on 20 December 2017. The CCIV is one of two main proposed solutions to the problem that offshore investors are dissuaded from investing in Australian funds because they do not understand unit trusts. The tax treatment of CCIVs will go a long way to determining their success.

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  • Unravelled: The Royal Commission heats up

    9 April 2018

    The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry is well underway, with its first round of public hearings wrapping up less than a month ago. By reference to a number of case studies, the first round of hearings focused on consumer lending practices. In this article, we report on the key themes identified by the Commission as arising from the hearings.

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  • Client Update: Asia Region Funds Passport Bill introduced

    6 April 2018

    Nearly nine years after the Johnson Report recommended the establishment of an Asia Region Funds Passport, last week the Corporations Amendment (Asia Region Funds Passport) Bill was introduced into Parliament, delivering on Australia's commitment as set out in the Asian Region Funds Passport's Memorandum of Cooperation. Partner Penny Nikoloudis and Associate Mai Go report on this significant milestone.

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  • Focus: Trustee insolvency - the Full Federal Court weighs in to the debate

    29 March 2018

    We recently examined the implications of a Victorian Court of Appeal decision on trustee insolvency in the Amerind Appeal1. As we foreshadowed, the Full Federal Court has just released its decision on similar issues.2 It came to a similar position to the Victorian court in deciding that trust assets should be applied first in paying employees and other statutory preferred creditors (though for varied reasons). But it came to the opposite position in holding that trust assets could only go to trust creditors, not non-trust creditors. That finding will cheer lenders and others dealing with trusts, but leaves a confused landscape. Partner Philip Blaxill, Senior Finance Counsel Diccon Loxton and Associate Lucas Tan report.

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  • Client Update: Parliamentary Committee reports on the life insurance industry

    28 March 2018

    The Parliamentary Joint Committee on Corporations and Financial Services has published its report on the life insurance industry. The report includes a nice summary of previous 'inquiries, reviews, reforms and events' since 2013. The Committee appears to think that all of these previous efforts have been more or less inadequate. Senior Regulatory Counsel Michael Mathieson reports.

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  • Unravelled: Preparing a target market determination for a financial product

    21 March 2018

    As the 'design and distribution' obligations for issuers and distributors of financial products inch closer, there is a good deal of hand-wringing taking place. Much of it concerns what a target market determination should look like. Guidance from the European Securities and Markets Authority on MiFID II provides a sense of what local issuers may be in for. But first - Treasury's proposal.

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  • Unravelled: Personal advice and the best interests duty

    21 March 2018

    There has been a great deal of attention given to the meanings of 'financial product advice' and 'personal advice' in the Corporations Act and many of us are eagerly waiting to see what Justice Gleeson will say about the topic in the case ASIC has brought against the BT trustees. However, whatever Her Honour decides in that case, it is unlikely to help very much, because the line between general advice and personal advice will always turn on the facts and, where the facts change with each interaction with a customer or client, it will continue to be difficult for licensees to be confident that they and their representatives are not giving personal advice. While that is a pity, it is, in my view, a greater pity that more licensees are not prepared to take the plunge and give personal advice. If licensees assumed that their interactions with customers and clients about financial products was personal advice, the difference between general advice and personal advice would not matter much.

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  • Focus: Statutory priority of secured creditors and trustee insolvency: implications of Re Amerind appeal decision

    13 March 2018

    The recent unanimous Victorian Court of Appeal decision1 in an appeal from Re Amerind has been widely welcomed by insolvency practitioners and others, as it brought some clarity to the question of whether the statutory order of priority applies to trust creditors. However, not all aspects of the decision will be as widely welcomed. In particular, in favouring a previous controversial decision of the court suggesting that trust assets should be applied in paying non-trust creditors, the Court of Appeal has resurrected a longstanding debate. Trust creditors and beneficiaries will be concerned if it is followed. Further, though insolvency practitioners and statutory preferred creditors will be generally pleased by the court's adoption of a wide interpretation of what is a 'circulating security interest' for the purpose of determining statutory priorities, it will concern secured creditors. Partner Philip Blaxill, Senior Finance Counsel Diccon Loxton and Associate Lucas Tan reflect on the decision and its ramifications.

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  • Contract Law Update 2017

    7 March 2018

    The phrase 'ready and willing to perform a contract' is very familiar to lawyers. But what exactly does it mean, and why is it important? The NSW Court of Appeal gave the answer last year in one of many interesting appellate decisions summarised in our annual Contract Law Update. Some other principles considered during the year include: When can a purchaser terminate a share purchase agreement following due diligence? When will illegality prevent a contract being enforced? What is the latest on the Bellgrove Principle? When does a new contract terminate an earlier contract between the same parties? We also look at the latest cases on contractual interpretation, contract formation and the penalties doctrine.

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  • Allens insights: Australia - Fund Finance 2018, 2nd Edition

    27 February 2018

    Fund financing activities in Australia remained strong in 2017, with particular focus on infrastructure, private equity funds and private debt funds, which have taken advantage of the additional liquidity and funding flexibility in this market. Allens Partner Tom Highnam, Managing Associate Rita Pang and Senior Associate Victoria Johns provide an overview of the funds landscape in Australia, key developments and the outlook for the next 12 months.

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  • Focus: Move to require big banks' participation in comprehensive credit reporting

    23 February 2018

    The Federal Government has introduced draft legislation to establish a long-awaited mandatory comprehensive credit reporting regime for the major banks from 1 July 2018. Partner Gavin Smith, Senior Associate Emily Cravigan and Lawyer Dougald Coulson report.

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  • Client Update: ACCC's Enforcement and Compliance priorities for 2018

    22 February 2018

    A number of industries and issues are in the spotlight following release of the ACCC's 2018 Enforcement and Compliance Priorities by ACCC Chairman Rod Sims on 20 February 2018. The financial services, energy, commercial construction and agriculture sectors will be a focus in 2018, as well as the post-Harper misuse of market power and concerted practices provisions, digital platforms and large franchisors.

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  • Pulse: Cyber security

    21 February 2018

    In this bulletin, we shine a light on the incoming Notifiable Data Breaches Scheme. We assume that with the scheme taking effect this week, you're now across the basics (if not, you can read about them here and here). So, this issue highlights the things you didn't know that you need to know, how to deal with data breaches involving multiple organisations, the key takeaways from the Office of the Australian Information Commissioner's just-published Data breach preparation and response guide and our quick reference guides to preparing a data breach response plan, determining when you've suffered an eligible data breach and how to notify when you have.

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  • Unravelled: Superannuation reform - the year ahead in 2018

    20 February 2018

    2017 was a busy year in superannuation. The Allens superannuation team takes stock of the legislative and regulatory reform proposals that have been mooted for 2018 and gazes into the crystal ball to see what might lie ahead this year.

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  • Unravelled: Productivity Commission releases draft report on competition in the financial system

    20 February 2018

    The Productivity Commission's draft report on competition in the financial system, released earlier in February, makes 25 draft recommendations, a key focus of which are reforms to the regulatory system. We take you through the key issues and recommendations.

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  • Focus: Federal Government review into Open Banking

    14 February 2018

    The Federal Government has released its much anticipated Review into Open Banking in Australia. The Review makes 50 sweeping recommendations to implement Open Banking, including a new regulatory framework under which the regime would operate in the broader context of a new Consumer Data Right for all sectors. Partner Gavin Smith, Senior Associate Elyse Adams, Associate Leah Wickman and Lawyer Connie Ye report on some of the key elements of the report.

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  • Client Update: Financial advice - vertically integrated institutions and conflicts of interest

    25 January 2018

    ASIC has released its report on financial advice provided by 'vertically integrated institutions', which is likely to be read with great interest by Commissioner Hayne and his team. Senior Regulatory Counsel Michael Mathieson and Partner Michelle Levy report.

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  • Pulse: Cyber security

    22 January 2018

    In this issue, we shine a light on ransomware – what it is, how it works, how much it costs, the continuing effects of recent attacks, and the key considerations to keep in mind when deciding whether to concede to a ransomware hacker’s demands. We also look at how data breaches might trigger a listed company’s continuous disclosure obligations, the OAIC’s investigation into Precedent Communications, and the Australian Cyber Security Centre’s 2017 Threat Report.

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  • Client Update: Financial products - design and distribution obligations and product intervention powers

    22 December 2017

    After a gestation period roughly one-and-a-half times as long as that of an elephant, the proposed new design and distribution obligations for financial products, and intervention powers for ASIC, took their first, tentative steps yesterday, with the release of exposure draft legislation. The consultation period is not so long - you have until 9 February 2018 to make a submission. Senior Regulatory Counsel Michael Mathieson reports.

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  • Unravelled: A Commission of Inquiry - of the Royal, not the Parliamentary, kind

    19 December 2017

    Since the announcement of the Royal Commission into, ahem, financial services, much has been written and said – a lot of which suggests that little attention is being paid to the terms of reference. In this article I take a look at those terms.

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  • Client Update: Attorney-General announces class action inquiry

    18 December 2017

    The Attorney-General has announced that he has asked the Australian Law Reform Commission to inquire into class action proceedings and third party litigation funders. The inquiry presents an important opportunity to take stock of how the class actions landscape has evolved, particularly whether entrepreneurialism among promoters is inappropriately traversing on the rights of class members. Partner Jenny Campbell and Lawyer Jerome Squires report.

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  • Client Update: Strengthening member outcomes in superannuation - APRA's proposals

    15 December 2017

    APRA this week released a discussion paper and draft prudential standards and practice guides. The standards and guides will apply to all RSE licensees from 1 January 2019. As Partner Michelle Levy and Senior Regulatory Counsel Michael Mathieson report, they will lead to significant changes across the superannuation industry.

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  • Client Update: Infrastructure investment in Australia - the road ahead for institutional investors

    11 December 2017

    With large-scale privatisations slowing and intense competition for assets that do come to market, institutional investors are looking to non-traditional assets to provide similar long-term, stable and predictable returns.

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  • Client Update: Updated guidance on conflicted remuneration and other banned benefits

    7 December 2017

    Earlier today, ASIC released an updated version of Regulatory Guide 246, concerning conflicted remuneration and other banned benefits such as volume-based shelf-space fees. The changes are largely to address the life insurance remuneration reforms, which take effect on 1 January 2018. But there are other changes too, some of them reasonably significant. Partner Michelle Levy and Senior Regulatory Counsel Michael Mathieson report.

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  • Focus: Unitranche financing in the Australian market

    4 December 2017

    As regulatory and political pressure increases on the major banks in Australia, alternative credit providers are entering the market with a variety of products to attract borrowers. The unitranche loan is an example of one such product. Partner Warwick Newell, Senior Overseas Practitioner Alex Tonkin and Associate Hamish McCormack examine what makes unitranche loans unique – and what role they could play in the increasingly competitive Australian acquisition financing market.

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  • Client Update: BEAR Bill implementation date likely to change

    24 November 2017

    This afternoon, the Senate Standing Committee on Economics released their report on the Treasury Laws Amendment (Banking Executive Accountability and Related Measures) Bill 2017 (BEAR Bill). The Economics Committee recommends that the BEAR Bill be passed but recommends the commencement date be pushed out for 12 months from the date of enactment.

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  • Unravelled: The BEAR has dropped, where to from here?

    9 November 2017

    The commencement date of the BEAR legislation is fast approaching and institutions should start planning how to comply with the regime. We look at the changes made to the BEAR legislation following industry submissions, the timing for implementation and key steps to take.

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  • Unravelled: The beginning of the end of the unit trust's monopoly? CCIV legislation and ASIC guidance

    9 November 2017

    Avid readers of Unravelled over the past few years cannot have failed to notice that there are moves afoot to introduce two new forms of collective investment vehicle, each promising a shiny, tax-neutral alternative to the unit trust and, hopefully, saving Australian lawyers a lot of sleepless nights and migraines attempting to explain the finer points of trust law to overseas counterparties and their advisers.

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  • Client Update: First civil penalty order for breach of FOFA duties

    6 November 2017

    The Federal Court recently imposed a $1 million civil penalty on a licensee for breaches by its representatives of the best interests and appropriate advice duties. The penalties were the same amount that was agreed between ASIC and the licensee. The decision is a reminder to financial services licensees that they are responsible for their advisers' advice and that ASIC can and will take enforcement action against licensees when it identifies breaches of personal advice duties. Partner Michelle Levy, Associate Katie Gardiner and Lawyer Jamil Diu report.

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  • Client Update: ASIC publishes draft funds management guidance

    27 October 2017

    ASIC has released draft updates to four existing Regulatory Guides and drafts of two new Regulatory Guides for managed investment schemes, corporate collective investment vehicles and passport funds, and announced a consultation period which will run until 8 December. Partners Marc Kemp and Penny Nikoloudis and Senior Overseas Practitioner James Kanabar provide a high-level summary of the draft guidance.

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  • Client Update: ASIC recommends tougher corporate penalties

    24 October 2017

    The ASIC Enforcement Taskforce's latest consultation paper pushes for a tougher penalty regime for corporate and financial sector misconduct, which has been key focus of the Taskforce's Terms of Reference, and indeed of ASIC's reform agenda for some time. Partner Belinda Thompson, Senior Associate Michela Agnoletti and Associate Katie Gardiner look at what the consultation paper proposes.

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  • Allens insights: Getting the deal through: Project Finance 2018

    20 October 2017

    Allens Partners Michael Ryan and Ben Farnsworth discuss some of the issues relevant to project finance in an Australian context (including security packages, navigating the Personal Property Security Register, and foreign investment issues) in their contribution to this global project finance roundup.

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  • Allens insights: Multisource financing: making multiple options work

    19 October 2017

    In an environment where Australian issuers, especially from the infrastructure sector, are actively seeking diversified funding options, two Allens Partners – James Darcy and Scott McCoy – discuss the key structuring considerations for issuers and sponsors wishing to establish debt platforms to access longer-term financing options.

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  • Focus: The Asia Region Funds Passport begins to take shape

    17 October 2017

    It's been a busy few months for the development of the Asia Region Funds Passport. In late August, the Federal Government released exposure draft legislation to accommodate the introduction of the Passport in Australia. Once implemented, the Passport will allow fund managers from participating economies to market and sell interests in qualifying funds to retail investors in other passport jurisdictions within a streamlined regulatory framework. Partner Penny Nikoloudis, Senior Associate Rebecca Sheehy and Associate Mai Go report on the proposed multilateral regulatory framework for the Passport and some of the issues arising from the exposure draft legislation. 

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  • Pulse: Cyber security

    16 October 2017

    In this issue we look at how to create a cyber resilient supply chain, ASIC's renewed focus on cyber resilience, how the incoming GDPR could affect you, medical device cyber security and patient safety, lessons learnt from Yahoo's data breach disaster and Australia and the EU's new cyber security plans.

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  • Client Update: Federal Court sheds new light on public benefit test in Tatts/Tabcorp merger appeal

    11 October 2017

    The Federal Court's decision about the proposed Tabcorp/Tatts merger has provided significant clarification about the public benefit test for authorisations. This is timely in light of the legislation before the Senate that proposes to combine the Tribunal authorisation process with the formal ACCC merger clearance process. Partner Jacqueline Downes and Lawyer Hanna Kaci look at the key lessons from the decision.

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  • Unravelled: Pseudo-investments and mobile apps - a new frontier for regulators

    4 October 2017

    It is hardly surprising that the Australian Securities and Investments Commission (ASIC) has taken an interest in the mobile app market, given that there has been an aggressive expansion into the mobile space by financial services providers. ASIC has recently cracked down on web and mobile based OTC derivative providers, and apps that facilitate binary options trading (BOT apps). In this article, we focus on issues that arise in connection with BOT apps.

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  • Unravelled: FX global code update

    4 October 2017

    The FX Global Code was launched in Australia earlier this year and applies to 'market participants', including most financial institutions, bank asset managers, brokers and E-trading platforms. The Code sets out 55 best practice principles and, although compliance is voluntary, it is expected that these principles will become the standard for the FX market industry.

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  • Unravelled: Spring overhaul of Australia's market licensing regime

    4 October 2017

    Australia's market licensing regime has long been crying out for an overhaul, with regulatory guidance that largely dates back to the early 2000s struggling in the face of significant developments in financial markets since then. Fortunately, ASIC has taken heed and is due to release an updated market licensing regulatory guide this month. If the draft guidance is anything to go by, we should soon see a much more modern and flexible approach to market licensing.

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  • Client Update: Blockchain reaction update - ASIC joins chorus on ICO regulation

    3 October 2017

    While ASIC has published information on the issue of coins or tokens in initial coin offerings, other regulators around the world have also been issuing guidance, with some taking a much more restrictive approach. Although Australia remains a relatively friendly regulatory environment for such offerings, there are a number of potential regulatory traps, both here and overseas, that issuers should carefully consider before launch. Managing Associate Simun Soljo, Senior Associate David Rountree and Lawyer Chris Walsh report.

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