On 31 March 2020, ASIC and the ASX announced temporary capital raising relief measures to assist ASX-listed entities affected by the COVID-19 pandemic to undertake emergency capital raisings (please see our March article on these measures). These measures were updated with effect from 23 April 2020 (please see our April article on these updates) and extended until 30 November 2020 by the ASX on 13 July 2020.

On 15 September 2020, the ASX released Compliance Update no. 09/20 to announce further changes to these measures as a result of the ongoing stabilisation in market conditions since these measures were extended in July, and to announce a number of other compliance updates, as summarised below:

Changes to the temporary emergency capital raising relief

• From 16 September 2020, any listed entity wishing to take advantage of the ASX temporary emergency capital raising relief measures must satisfy the ASX that it is raising capital predominantly for the purposes of addressing the existing or potential future financial effects on the entity resulting from the COVID-19 pandemic and/or its economic impact, along with satisfying the other existing conditions.
• Where a capital raising appears to the ASX to have inequitable features for existing security holders, the ASX may withhold the benefit of the relief measures from the listed entity, even if the capital raising is specifically COVID-19 related and urgently needed.

Ratification of issues of securities under the increased placement capacity relief

• Under the temporary emergency capital raising relief measures, the 15% limit on placements by listed entities without shareholder approval in listing rule 7.1 has been increased to 25%.
• Following a number of queries from listed entities and their advisers, the ASX has reiterated in Compliance Update no. 09/20 that listed entities that have utilised the temporary extra 10% placement capacity under listing rule 7.1 cannot subsequently ratify or replenish the used up extra 10% placement capacity.
• Listed entities that have relied on the temporarily increased placement capacity in listing rule 7.1 are only able to approve or ratify issues made from their normal 15% placement capacity under listing rule 7.1 but not from the 10% temporary extra placement capacity.

Updates to ASX listing rule Guidance Notes

In Compliance Update no. 09/20, the ASX announced the release of updates to listing rule Guidance Notes 3, 4, 12 and 19, as follows:

• Guidance Note 3 (Co-operatives and Mutuals Listing on the ASX) has been updated to add a new section 7.6 addressing the ‘mutual capital instruments’ that mutual entities are now able to issue under Part 2B.8 of the Corporations Act and the similar ‘co-operative capital units’ that co-operatives are able to issue under Division 2 of Part 3.4 of the Co-operatives National Law.
• Guidance Note 4 (Foreign Entities Listing on the ASX) has been amended to add the Tel Aviv Stock Exchange as an acceptable listing venue for foreign exempt listings and to reflect the relief ASIC has recently granted to US-incorporated listed companies to allow them to prepare and file accounts under section 601CK of the Corporations Act using US GAAP rather than Australian IFRS.
• A number of changes have been made to Guidance Note 12 (Significant Changes to Activities) including to clarify the preliminary steps an entity should take before announcing a proposed significant transaction under listing rule 11.1.
• Guidance Note 19 (Performance Securities) has been substantially amended to address emerging areas of concern with performance securities, including by expanding this Guidance Note to cover performance options and performance rights, as well as performance shares.

Compliance requirements for draft notices of meeting

• On 1 December 2019, a number of substantial amendments were made to the listing rules relating to the requirements for notices of meeting and voting exclusions.
• In Compliance Update no. 09/20, the ASX reminds listed entities to ensure that draft notices of meeting submitted to the ASX for review reflect these amendments.

Changes to operating hours during daylight saving

• Daylight saving commences in New South Wales, the Australian Capital Territory, Victoria, Tasmania and South Australia at 2:00 a.m. EST on Sunday, 4 October 2020, and will end at 3:00 a.m. on Sunday, 4 April 2021.
• As Western Australia will be 3 hours behind Sydney time during daylight saving, ASX Market Announcements will stay open until 8.30 p.m. EST (5.30 p.m. WST) starting on Monday, 5 October 2020.

A copy of Compliance Update no. 09/20 can be found here.