Relief that was previously in existence for business
introduction services in relation to managed investment schemes has
now expired. ASIC's position is that the relief was relied on
by only a small number of entities and when ASIC sought feedback on
their plan to expire the relief, only two (2) submissions were
received. Earlier versions of the relief had also applied to
securities, however those have long since expired.
Business introduction services (in their most recent form) were services that enable information sharing between potential investors, issuers and sellers of products through various channels including meetings and publications such as brochures and bulletins. ASIC Corporations (Business Introduction Services) Instrument 2022/805 (the Instrument) provided relief from provisions of the Corporations Act which dealt with:
- financial product disclosure,
- anti-hawking; and
- advertising requirements.
Importantly, the Instrument did not provide relief from holding a financial services licence.
The relief targeted managed investment schemes which have less than 20 members and are seeking to raise funds of up to $5 million, but also applied to:
- operators of business introduction services;
- issuers or sellers of scheme interests through the use of business introduction services;
- persons who endorse or verify information which appears in business introduction service publications ('endorsers'); and/or
- publishers of business introduction service publications;
where they were engaged in the following activities;
- offering interests in a scheme;
- advertising an offer or intended offer of scheme interests;
- recommending that a person acquire those scheme interests; and/or
- publishing a statement that refers to the offer or intended offer or is reasonably likely to induce people to apply for a scheme interest.
ASIC has withdrawn Regulatory Guide 129 and all entities which were previously relying on the relief in the Instrument will now be subject to the provisions in the Corporations Act dealing with disclosure, anti-hawking and advertising financial products.
If you need assistance with your obligations, please contact us.
Further Reading
ASIC to allow instrument for business introduction and matching services relief to expire
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
