13 Mar 2013

Continuous Disclosure: all to change on 1 May (or thereabouts)

Listed companies have six weeks to prepare for the new reality of continuous disclosure.

ASX today released the final version of its new guidance on Listing Rule 3.1, along with a raft of amendments to the Listing Rules. ASX hopes to put the guidance and Listing Rule changes into effect on or around 1 May.

Clayton Utz is preparing a detailed analysis of both the revised guidance and the new Listing Rules. This will explain what the changes are and what listed companies have to do to comply with them.

The changes

ASX first released its proposed rewrite of Guidance Note 8 in October last year.

Since that time, it has conducted roadshows and consultations on the proposals. Clayton Utz provided its own client briefings on the changes and, following discussions with clients, made its own submissions to ASX.

The documents released today reflect that consultation process. Although the big picture hasn't changed, ASX has taken on board many of the suggestions for clarifying or fleshing out the details in its guidance. New or additional revised guidance has been included on:

  • what ASX means by “delay” (when it says that “immediately” means “promptly and without delay”);
  • trading halts;
  • when ASX treats media and analyst reports and market rumours as evidencing a loss of confidentiality under Listing Rule 3.1A.2;
  • the “reasonable person” test in Listing Rule 3.1A.3;
  • ASX’s expectations around the monitoring of social media; and,
  • "earnings surprises", and the role played by consensus estimates in setting market expectations for earnings.


Overall, ASX has provided a sensible interpretation of the continuous disclosure regime that recognises and accommodates the complexities that listed entities face in the day-to-day application of the rule to their businesses. However, the corollary of increased flexibility in the interpretation of the rules is increased need for entities to consider each potential disclosure issue on the basis of all the relevant facts and circumstances and exercise judgment and experience in order to ensure that the market for the entity's securities does not trade uninformed.

Along with the revised guidance, ASX is proposing a number of related changes to the Listing Rules. Because those changes require government approval, ASX does not expect the whole package to come into effect until around 1 May this year. This will also give listed entities time to take the changes on board. Although, as we suggested back in October, market participants would be wise to take many of these proposals into account when considering compliance with their continuous disclosure obligations as indicative of both ASX's and ASIC's interpretation of those obligations even before they are officially adopted.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.