The Australian Securities and Investment Commission (ASIC) has released a new legislative instrument on horse schemes, replacing three class orders on horse racing syndicates and horse breeding schemes that were due to expire (‘sunset’).
The new instrument follows a public consultation “Consultation Paper 242 Remaking ASIC class orders on horse racing syndicates and horse breeding schemes”, in which ASIC proposed to remake the class orders without any fundamental changes.
The existing class orders have effectively been combined into a single instrument with no fundamental changes, as proposed, so that the effect of the relief provided by them will be preserved without any disruption to those who rely on them.
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The key changes made to the terms of the relief for horse racing syndicates are:
- raising the investment limit for a horse racing syndicate from $250,000 to $500,000
- increasing the maximum number of members for a horse racing syndicate from 20 to 50
- formalising the co-regulatory arrangements between ASIC and the lead regulators
- imposing additional content requirements for a product disclosure statement for a horse racing syndicate
ASIC has also updated Regulatory Guide 91 (Horse racing and breeding) to reflect the terms of the new legislative instrument.
Under the Legislation Act 2003, all class orders sunset after a specified period of time, usually 10 years, unless ASIC takes action to exempt or preserve them. This ensures that legislative instruments such as class orders are kept up to date and only remain in force while they are fit for purpose and relevant.
As Australia’s corporate, markets and financial services regulator, ASIC contributes to Australia’s economic reputation and wellbeing by ensuring that the country’s financial markets are fair, transparent and supported by confident and informed investors and consumers.
The release of the new instrument follows the publication of guidance on providing digital financial product advice for retail investors (RG 255) yesterday, and is part of ASIC’s wide ranging and expanding oversight responsibilities.