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Law Council of Australia

Business Law Section

Proposal to remake managed investment scheme legislative instruments

This submission is made by the Financial Services Committee of the Business Law Section of the Law Council of Australia (the Committee) and relates to a “News” announcement made by the Australian Securities and Investments Commission (ASIC) on 18 January 2024, entitled “ASIC proposes to remake managed investment scheme legislative instruments” (the Proposal).

The Committee thanks ASIC for providing the opportunity and a reasonable timeframe to comment on the Proposal, which involves ASIC remaking each of the following legislative instruments (which are due to sunset on 1 April 2024) for a period of five years:

  1. ASIC Class Order [CO 13/1200] Periodic statements relief for AQUA quoted and listed managed investment scheme manager.
  2. ASIC Class Order [CO 13/1406] Land holding for primary production schemes.
  3. ASIC Class Order [CO 13/1409] Holding assets: Standards for responsible entities.
  4. ASIC Class Order [CO 13/1410] Holding assets: Standards for providers of custodial and depository services.
  5. ASIC Class Order [CO 13/1621] Exemption and declaration for the operation of mFund (the mFund Instrument).

In principle, the Committee agrees with ASIC’s observation that these legislative instruments are “generally operating effectively and efficiently and continue to form a necessary and useful part of the legislative framework”. The Committee also considers it appropriate for ASIC to monitor the appropriateness of these legislative instruments having regard to its regulatory experience, feedback from relevant stakeholders, and outcomes from the Review of the Regulatory Framework for Managed Investment Schemes.

However, the Committee notes the Australian Securities Exchange’s publicly stated intention to close the mFund Settlement Service with effect from 31 May 2026,1 and encourages ASIC to consider whether the mFund Instrument might in fact become redundant upon the cessation of the mFund Settlement Service (which would be earlier than the other proposed sunset date of 1 April 2029).

Read the full submission below.

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