ASIC puts expiry date on COVID-19 relief

ASIC will repeal its amended share and interest purchase plan and also its trading suspension relief package.

ASIC also flagged it will repeal its financial advice relief on October 15, six-months after the temporary measure was introduced.

The corporate regulator has set an expiry date for its COVID-19 support measures regarding capital raisings and financial advice rules.

The Australian Securities and Investments Commission on Friday said it will taper its relief packages implemented during the coronavirus pandemic, which altered the rules surrounding equity raisings and advice requirements.

On October 2, ASIC will repeal its amended share and interest purchase plan, and also its trading suspension relief package, saying it will continue to monitor the appropriateness of the support while a significant level of uncertainty still lingers around the timeline of the pandemic.

Both specific pieces of legislation relate to the facilitation of capital raisings, a measure used by a number publicly listed companies that have attempted to boost liquidity buffers during the downturn.

NAB, Cochlear and Flight Centre are among some of the major listed entities that turned to the ASX for additional capital injections.

ASIC during the crisis allowed companies to tap the market for extra cash even if a company did not meet normal requirements.

The “low doc” relief allowed a company to issue a rights offer, institutional placement or a share purchase plan.

ASIC also flagged it will repeal its financial advice relief on October 15, six-months after the temporary measure was introduced.

The regulator’s relief measures included financial advice providers not needing a statement of advice when providing guidance about the early release of superannuation.

It also allowed existing tax agents to provide advice on early access to super without needing to hold an Australian financial services licence.

A temporary no action position for trustees providing personal advice was also implemented as a relief measure.

“ASIC had publicly stated that these relief measures were temporary and ASIC would repeal the instruments following the COVID-19 crisis,” the regulator said.

“ASIC considers it appropriate to end the relief before the six month period or extend the relief, ASIC will give sufficient notice before any early repeal or extension is implemented.”

The regulator was prompted by a Senate committee to include specific end dates to its relief measures.