iSignthis (ASX:ISX), a payments identity company, has published the Supplementary Independent Expert Report by Clayton Utz regarding the suspension and termination of the arrangements between ISX and Visa.
As Finance Magnates reported, on 16th July 2020, Clayton Utz published its Independent Expert Report, as ordered by the Australian Securities Exchange (ASX). The review found that while iSignthis is ‘largely compliant with the Regulatory Recommendations’ it did identify a number of areas where the company could improve in regards to Listing Rule 3.1, which covers Continuous Disclosures.
In the supplementary report, dated on 4th September 2020 and published via the ASX earlier this week on Monday, Clayton Utz has taken a look into iSignthis’ disclosures regarding Visa.
iSignthis: report vindicates our position
According to a statement from ISX today, the report “vindicates the position adopted by ISX in relation to disclosure of its dispute with Visa” and “ends ASX’s baseless campaign to portray ISX as non-compliant with the continuous disclosure regime.”
Taking a look at the report, Clayton Utz outlines that iSignthis received a formal response from the European regulator, the Central Bank of Cyprus, on Thursday 21st May, and that its arrangements with Visa had been terminated.
iSignthis then sought to formally announce the termination to the market via a letter to shareholders dated on Sunday 24th May 2020. This was released by the ASX to the market the next day on 25th May 2020.
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ISX delay was a technical breach of ASX Listing Rule 3.1
In summary, Clayton Utz said in its report: “We therefore consider that there was a technical breach of the ASX Listing Rule 3.1 arising from this delay[…] However, we also observe that given trading in ISX’s shares was suspended during this period, ISX did not have the ability to use a trading halt to assist it to manage its continuous disclosure obligations, which it may have otherwise done[…]”
Speaking to Finance Magnates, the CEO of iSignthis, John Karantzis said: “The supplementary independent expert report on iSignthis’ continuous disclosure further demonstrates that ISX adheres to best practice. Dealing with complex regulatory matters across multiple timezones is never straight forward, and in particular when the matter is likely to result in litigation or regulatory intervention.
“iSignthis and Visa have been arguing over Visa network access and termination since April following spurious claims about how iSignthis runs its e-money business and amid hostile press briefings.
“iSignthis had been given a clean bill of health by financial intelligence units and independent audits, and Visa’s actions were designed to protect its own position, not that of consumers.
“Visa’s anticompetitive conduct and its new rules for ‘digital wallet operators’ are already the subject of a European Commission Directorate General of Competition investigation.”
ASX declined to comment.