Round up of other ASIC related matters

Change in control of an AFS licensee 

ASIC has reiterated that a change in control of an AFS licensee is to be notified to ASIC.  Control means having more than 50% of the voting rights or issued share capital, the capacity to control the composition of the Board or governing body, or the capacity to determine the outcome of decisions about the licensee’s financial and operating policies. 

To notify ASIC of a change in control, an AFS licensee is required to write to ASIC within 10 business days with information of the name and number of the AFS licensee, the effective date of the change in control, the capacity of the person lodging the notification of the change in control (e.g. director or secretary), the identity of the person who acquired control, the effects of the change in control on the capacity to control the composition of the Board or governing body, and the effects of the change in control on the capacity to determine the outcome of the financial and operating policies of the licensee.

First civil penalty under the National Consumer Credit Protection Act

The first civil penalty proceeding under the National Consumer Credit Protection Act was brought by ASIC against a director of an unlicensed credit provider company.  The director was ordered to pay a penalty of $7,500 after the company was found to have advertised that it could provide credit despite repeated warnings from ASIC.  The advertisement was removed only after ASIC commenced court action.  

ASIC stated that where a possible breach of the consumer credit laws has been identified, ASIC’s first step will often be to require the company to take action to ensure the contravention ceases.  Where it does not, ASIC is prepared to commence civil penalty proceedings as part of its approach to enforcement.