ASIC has released consultation papers and draft
regulatory guides aimed at improving disclosure to retail investors by
unlisted mortgage schemes and unlisted property schemes.
Consultation Paper 99 Mortgage schemes – improving disclosure for retail investors(including the draft regulatory guide)
Consultation Paper 100 Unlisted property schemes – improving disclosure for retail investors (including the draft regulatory guide)
ASIC will be producing companion investor guides for both
sectors to assist investors in understanding the enhanced disclosure
and make better informed investment decisions.
ASIC encourages responsible entities to communicate
the enhanced disclosure information to investors in the most effective
way possible and using existing effective investor communication
channels (e.g. by the scheme’s website and regular reports).
ASIC has also included draft guidance for
advertising of these products and its expectations of compliance plans,
compliance committees and compliance plan auditors.
Unlisted mortgage schemes
ASIC’s draft regulatory guide proposes a
benchmark-based disclosure model for unlisted mortgage schemes. The
eight benchmarks differ from the ones introduced for debentures to
reflect the different risk profile of unlisted mortgage schemes and the
different legal structures and rights associated with this type of
investment.
ASIC is proposing that responsible entities for
existing mortgage schemes report against benchmarks to existing
investors by 31 October 2008. From this date, new fundraising documents
for new and existing mortgage schemes need to comply with the ‘if not,
why not’ benchmarks.
Unlisted property schemes
The new proposals centre on eight disclosure
principles that are designed to give issuers guidance on key areas that
need to be prominently disclosed to existing and potential retail
investors.
Clear and prominent disclosure of information
referred to in the disclosure principles will allow retail investors to
compare the relative risk and return of unlisted property scheme
investments.
ASIC does not currently propose to extend the ‘if
not, why not’ approach to unlisted property schemes.
ASIC is proposing that responsible entities for
existing unlisted retail property schemes provide updated disclosure to
existing investors applying in the new disclosure principle by 31
October 2008. From this date, responsible entities of all unlisted
retail property schemes will need to apply the disclosure principles to
PDSs and ongoing disclosures.
