Australian Securities Exchange amends listing rules

Maria Nikolova

The new rules envisage an extension of ASX’s ‘good fame and character’ listing condition to include non-director CEOs and CFOs.

The Australian Securities Exchange (ASX) is reforming its listing rules in order to boost market quality. Today, the Exchange published its final response to submissions to its November 2018 consultation paper “Simplifying, clarifying and enhancing the integrity and efficiency of the ASX listing rules”. The response includes a range of rule amendments and new and updated guidance.

ASX Chief Compliance Officer, Kevin Lewis, explained that the changes aim to improve disclosures to the market, make the listings rules easier to understand and comply with, and enable ASX to better monitor and enforce compliance with the listing rules.

The new rules include more guidance and direction on the information that should be given to shareholders in notices of meetings. There is also additional guidance and direction on the voting processes that should be followed at shareholder meetings and more consistent reporting of voting outcomes.

The new rules spell out simpler and clearer processes and forms to announce a proposed issue of shares and to seek their quotation.

Further, there are changes to ASX’s quarterly reporting regime to provide a more robust disclosure framework for start-up entities.

There will also be new measures to address breaches of the listing rules.

In addition, there are further enhancements to ASX’s admission rules and processes, including:

  • a simplification of ASX’s escrow rules and guidance to make the escrow process less burdensome for listed entities
  • an extension of ASX’s ‘good fame and character’ listing condition to include non-director CEOs and CFOs
  • measures to address inappropriate behaviours by promoters and professional advisers in new and back door listings.

Finally, in order to improve the quality and consistency of market disclosures and information, from July 1, 2020, any person appointed responsible for communicating with ASX about listing rule matters will have to complete an approved education course and examination covering listing rule compliance.

Subject to the receipt of the necessary regulatory approvals, the listing rule amendments and new and updated guidance notes will become effective on December 1, 2019.

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