Corporations (Coronavirus Economic Response) Determination (No. 2) 2020 (the Determination) has been made to temporarily modify the scope for civil proceedings for breaches of the continuous disclosure obligations in circumstances relating to COVID-19.
It is designed to encourage disclosing entities to continue to disclose information to markets or to ASIC in circumstances where it is significantly more challenging for disclosing entities to know whether a given piece of information will have a material effect on the price or value of its securities and therefore forecast the entity’s future earnings or prospects.
The Determination modifies the operation of the civil penalty provisions in subsections 674(2), 674(2A), 675(2) and 675(2A) of the Corporations Act to establish a temporary test based on a disclosing entity or its officers’ knowledge, recklessness or negligence with respect to whether certain information would have a material effect on the price or value of its enhanced disclosure (ED) securities and therefore should be disclosed under section 674 or 675 of the Act.
The Determination commenced on 26 May 2020 and expires on 25 November 2020.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
