{"id":"F2026L00336","name":"ASIC Corporations (Regulatory Capital Securities) Instrument 2026/88","slug":"asic-corporations-regulatory-capital-securities-instrument-2026-88","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":107894,"registerId":"commonwealth-F2026L00336-current","compilationNumber":null,"startDate":"2026-04-03","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"“Sale offer of securities issued on conv","sectionType":"section","heading":"“Sale offer of securities issued on conversion or exchange of regulatory capital securities—case 6","content":"Part 2—Declaration\n\n7 Definitions of notional underlying securities, regulatory capital security and underlying securities\n\nChapter 6D of the Act applies to all persons as if section 9 of the Act were modified or varied as follows:\n\n(a) insert the following definition:\n\n“notional underlying securities, in relation to regulatory capital securities, means securities that would be issued on conversion or exchange if the conversion or exchange occurred at the time of issue of the regulatory capital securities.”;\n\n(b) insert the following definition:\n\n“regulatory capital security means a security that satisfies all of the following:\n\n(a) the security is issued by any of the following entities:\n\n(i) an authorised deposit-taking institution, a subsidiary of an authorised deposit-taking institution or an authorised NOHC for the purposes of the Banking Act 1959;\n\n(ii) a general insurer, a subsidiary of a general insurer or an authorised NOHC for the purposes of the Insurance Act 1973;\n\n(iii) a life company, a subsidiary of a life company or a registered NOHC for the purposes of the Life Insurance Act 1995;\n\n(b) either:\n\n(i) under the terms of the security, it must or may be converted into, or exchanged for, ordinary shares in:\n\n(A) the issuer of the security; or\n\n(B) an entity that is both:\n\n(I) an authorised deposit-taking institution, a general insurer, a life company, an authorised NOHC or a registered NOHC for the purposes of any of those Acts; and\n\n(II) the ultimate holding company of the issuer; or\n\n(C) an entity (including an entity that, at the time the security is issued, does not exist) that, as a result of a restructure (however described) will be, at the time of conversion or exchange, both:\n\n(I) an authorised NOHC or a registered NOHC for the purposes of any of those Acts; and\n\n(II) the ultimate holding company of the issuer;\n\nin the circumstances permitted or required by prudential standards made for the purposes of any of those Acts; or\n\n(ii) under the terms of the security, it must or may be converted into, or exchanged for, ordinary shares in any of the entities referred to in subparagraph (i), where the proceeds from the issue of the security is to be used to acquire a regulatory capital security of a subsidiary of the issuer the terms of which satisfy subparagraph (i);\n\n(c) if, at the time the security is issued, the conversion or exchange occurred, the ordinary shares to be issued on conversion or exchange would be in a class of continuously quoted securities.”;\n\n(c) in the definition of underlying securities, after paragraph (aa) (as notionally inserted by ASIC Corporations (Offers of Convertibles) Instrument 2026/97), insert:\n\n“(ab) in relation to regulatory capital securities—the securities that are issued on conversion or exchange of the regulatory capital securities; and”.\n\n8 Offers of regulatory capital securities that are convertible or exchangeable into continuously quoted securities\n\nChapter 6D of the Act applies to all persons as if section 713 were modified or varied as follows:\n\n(a) after paragraph (1) (aa) (as notionally inserted by ASIC Corporations (Offers of Convertibles) Instrument 2026/97), insert:\n\n“(ab) regulatory capital securities; or”;\n\n(b) after paragraph (2(ca) (as notionally inserted by ASIC Corporations (Offers of Convertibles) Instrument 2026/97), insert:\n\n“(cb) if the securities are regulatory capital securities—the rights and liabilities attaching to:\n\n(i) the regulatory capital securities themselves; and\n\n(ii) the notional underlying securities; and”;\n\n(c) after subsection (2), insert:\n\n“Issuer of notional underlying securities must consent to statements\n\n(2A) To avoid doubt, and without limiting subsection 716(2), if the securities are regulatory capital securities, and the body that is to issue those securities is not the body that is to issue the notional underlying securities:\n\n(a) the body that is to issue the notional underlying securities must consent to all statements in the prospectus about the notional underlying securities and the body; and\n\n(b) the prospectus must state that that body has given this consent; and\n\n(c) that body must not have withdrawn this consent before the prospectus is lodged with ASIC.”;\n\n(d) after subsection (7), insert:\n\n“Third party acquisition scenarios\n\n(8) This section does not apply in relation to an offer of regulatory capital securities if, under the terms of the securities, they must or may be converted into, or exchanged for, ordinary shares in an entity (including an entity that, at the time the securities are issued, does not exist) that, as a result of a restructure (however described) initiated by persons other than the directors of the issuer of the securities or the ultimate holding company of the issuer, will be, at the time of exchange or conversion, the ultimate holding company of the issuer.”.\n\n9 Sale offers of underlying securities issued on conversion or exchange of regulatory capital securities\n\nChapter 6D of the Act applies to all persons as if section 708A were modified or varied by, after subsection (12)(F) (as notionally inserted by ASIC Corporations (Sale Offers: Securities Issued on Conversion of Convertible Notes) Instrument 2026/96), inserting:\n\n#### “Sale offer of securities issued on conversion or exchange of regulatory capital securities—case 6\n\n#### (12G) The sale offer does not need disclosure to investors under this Part if:\n\n    (a) the relevant securities were issued by reason of the conversion or exchange of regulatory capital securities in accordance with their terms of issue; and\n    (b) the regulatory capital securities were issued under a prospectus; and\n    (c) the conversion or exchange did not involve any further offer.\n    (12GA) Subsection (12G) does not apply in relation to relevant securities that were issued by reason of the conversion or exchange of regulatory capital securities if, under the terms of the regulatory capital securities at the time they were issued, they must or may be converted into, or exchanged for, ordinary shares in an entity (including an entity that, at the time the regulatory capital securities were issued, does not exist) that, as a result of a restructure (however described) initiated by persons other than the directors of the issuer of the regulatory capital securities or the ultimate holding company of the issuer, will be, at the time of exchange or conversion, the ultimate holding company of the issuer.\n\n#### Sale offer of securities issued on conversion or exchange of regulatory capital securities—case 7\n\n#### (12H) The sale offer does not need disclosure to investors under this Part if:\n\n    (a) the relevant securities were issued by reason of the conversion or exchange of regulatory capital securities in accordance with their terms of issue; and\n    Note: The relevant securities are the underlying securities issued on conversion or exchange of the regulatory capital securities.\n    (b) on the day on which a notice in relation to the regulatory capital securities was given under paragraph (e), there was no determination under subsection 713(6) in force in respect of either:\n      (i) the issuer of the regulatory capital securities; or\n      (ii) if the issuer of the regulatory capital securities is not the issuer of the notional underlying securities—the issuer of the notional underlying securities; and\n    (c) trading in securities in the class of notional underlying securities on the declared financial market on which they are quoted was not suspended for more than a total of 5 days during the shorter of the period during which the class of notional underlying securities were quoted, and the period of 12 months before the first day on which the regulatory capital securities were issued; and\n\n> Note: declared financial market is defined in section 9D. Until the time the first declaration is made under subsection 9D(2), a market that was prescribed as a prescribed financial market by former regulation 1.0.02A of the Corporations Regulations 2001 is taken to be a declared financial market: see section 1705F.\n\n    (d) the conversion or exchange of the regulatory capital securities did not involve any further offer; and\n    (e) a notice that complies with subsection (12I) on the same day as, or within 2 business days before, the first day on which the regulatory capital securities were issued was given to the relevant market operator:\n    (i) if the body that issued the regulatory capital securities is also the issuer of the notional underlying securities—by the body;\n      (ii) if the body that issued the regulatory capital securities is not the issuer of the notional underlying securities—jointly by both the issuer of the regulatory capital securities and the issuer of the notional underlying securities.\n  (12I) A notice complies with this subsection if:\n    (a) the notice contains the following information:\n      (i) for the regulatory capital securities—the information required by subsection 713(2); and\n      (ii) for securities in the class of notional underlying securities—the information required by subsections 713(2) to (5),\n    as if the notice were a prospectus; and\n    (b) the information in the notice is worded and presented in a clear, concise and effective manner; and\n    (c) where the notice includes a statement by a person, or a statement said in the notice to be based on a statement by a person:\n      (i) the person has consented to the statement being included in the notice in the form and context in which it is included;\n      (ii) the notice states that the person has given this consent; and\n      (iii) the person has not withdrawn this consent before the notice is given to the relevant market operator.”.\n\nNote: Subsection 708A(1) of the Act is notionally modified by ASIC Corporations  \n(Non-Traditional Rights Issues) Instrument 2026/98.\n\n  \n\nPart 3—Repeal\n\n10 Repeal\n\nThis instrument is repealed at the start of 1 April 2031.\n\n  \n\nSchedule 1—Repeals\n\nASIC Corporations (Regulatory Capital Securities) Instrument 2016/71\n\n1 The whole of the instrument\n\nRepeal the instrument.","sortOrder":0},{"sectionNumber":"(12G) The sale offer does not need discl","sectionType":"section","heading":"(12G) The sale offer does not need disclosure to investors under this Part if:","content":"#### (12G) The sale offer does not need disclosure to investors under this Part if:\n\n    (a) the relevant securities were issued by reason of the conversion or exchange of regulatory capital securities in accordance with their terms of issue; and\n    (b) the regulatory capital securities were issued under a prospectus; and\n    (c) the conversion or exchange did not involve any further offer.\n    (12GA) Subsection (12G) does not apply in relation to relevant securities that were issued by reason of the conversion or exchange of regulatory capital securities if, under the terms of the regulatory capital securities at the time they were issued, they must or may be converted into, or exchanged for, ordinary shares in an entity (including an entity that, at the time the regulatory capital securities were issued, does not exist) that, as a result of a restructure (however described) initiated by persons other than the directors of the issuer of the regulatory capital securities or the ultimate holding company of the issuer, will be, at the time of exchange or conversion, the ultimate holding company of the issuer.","sortOrder":1},{"sectionNumber":"Sale offer of securities issued on conve","sectionType":"section","heading":"Sale offer of securities issued on conversion or exchange of regulatory capital securities—case 7","content":"Part 2—Declaration\n\n7 Definitions of notional underlying securities, regulatory capital security and underlying securities\n\nChapter 6D of the Act applies to all persons as if section 9 of the Act were modified or varied as follows:\n\n(a) insert the following definition:\n\n“notional underlying securities, in relation to regulatory capital securities, means securities that would be issued on conversion or exchange if the conversion or exchange occurred at the time of issue of the regulatory capital securities.”;\n\n(b) insert the following definition:\n\n“regulatory capital security means a security that satisfies all of the following:\n\n(a) the security is issued by any of the following entities:\n\n(i) an authorised deposit-taking institution, a subsidiary of an authorised deposit-taking institution or an authorised NOHC for the purposes of the Banking Act 1959;\n\n(ii) a general insurer, a subsidiary of a general insurer or an authorised NOHC for the purposes of the Insurance Act 1973;\n\n(iii) a life company, a subsidiary of a life company or a registered NOHC for the purposes of the Life Insurance Act 1995;\n\n(b) either:\n\n(i) under the terms of the security, it must or may be converted into, or exchanged for, ordinary shares in:\n\n(A) the issuer of the security; or\n\n(B) an entity that is both:\n\n(I) an authorised deposit-taking institution, a general insurer, a life company, an authorised NOHC or a registered NOHC for the purposes of any of those Acts; and\n\n(II) the ultimate holding company of the issuer; or\n\n(C) an entity (including an entity that, at the time the security is issued, does not exist) that, as a result of a restructure (however described) will be, at the time of conversion or exchange, both:\n\n(I) an authorised NOHC or a registered NOHC for the purposes of any of those Acts; and\n\n(II) the ultimate holding company of the issuer;\n\nin the circumstances permitted or required by prudential standards made for the purposes of any of those Acts; or\n\n(ii) under the terms of the security, it must or may be converted into, or exchanged for, ordinary shares in any of the entities referred to in subparagraph (i), where the proceeds from the issue of the security is to be used to acquire a regulatory capital security of a subsidiary of the issuer the terms of which satisfy subparagraph (i);\n\n(c) if, at the time the security is issued, the conversion or exchange occurred, the ordinary shares to be issued on conversion or exchange would be in a class of continuously quoted securities.”;\n\n(c) in the definition of underlying securities, after paragraph (aa) (as notionally inserted by ASIC Corporations (Offers of Convertibles) Instrument 2026/97), insert:\n\n“(ab) in relation to regulatory capital securities—the securities that are issued on conversion or exchange of the regulatory capital securities; and”.\n\n8 Offers of regulatory capital securities that are convertible or exchangeable into continuously quoted securities\n\nChapter 6D of the Act applies to all persons as if section 713 were modified or varied as follows:\n\n(a) after paragraph (1) (aa) (as notionally inserted by ASIC Corporations (Offers of Convertibles) Instrument 2026/97), insert:\n\n“(ab) regulatory capital securities; or”;\n\n(b) after paragraph (2(ca) (as notionally inserted by ASIC Corporations (Offers of Convertibles) Instrument 2026/97), insert:\n\n“(cb) if the securities are regulatory capital securities—the rights and liabilities attaching to:\n\n(i) the regulatory capital securities themselves; and\n\n(ii) the notional underlying securities; and”;\n\n(c) after subsection (2), insert:\n\n“Issuer of notional underlying securities must consent to statements\n\n(2A) To avoid doubt, and without limiting subsection 716(2), if the securities are regulatory capital securities, and the body that is to issue those securities is not the body that is to issue the notional underlying securities:\n\n(a) the body that is to issue the notional underlying securities must consent to all statements in the prospectus about the notional underlying securities and the body; and\n\n(b) the prospectus must state that that body has given this consent; and\n\n(c) that body must not have withdrawn this consent before the prospectus is lodged with ASIC.”;\n\n(d) after subsection (7), insert:\n\n“Third party acquisition scenarios\n\n(8) This section does not apply in relation to an offer of regulatory capital securities if, under the terms of the securities, they must or may be converted into, or exchanged for, ordinary shares in an entity (including an entity that, at the time the securities are issued, does not exist) that, as a result of a restructure (however described) initiated by persons other than the directors of the issuer of the securities or the ultimate holding company of the issuer, will be, at the time of exchange or conversion, the ultimate holding company of the issuer.”.\n\n9 Sale offers of underlying securities issued on conversion or exchange of regulatory capital securities\n\nChapter 6D of the Act applies to all persons as if section 708A were modified or varied by, after subsection (12)(F) (as notionally inserted by ASIC Corporations (Sale Offers: Securities Issued on Conversion of Convertible Notes) Instrument 2026/96), inserting:\n\n#### “Sale offer of securities issued on conversion or exchange of regulatory capital securities—case 6\n\n#### (12G) The sale offer does not need disclosure to investors under this Part if:\n\n    (a) the relevant securities were issued by reason of the conversion or exchange of regulatory capital securities in accordance with their terms of issue; and\n    (b) the regulatory capital securities were issued under a prospectus; and\n    (c) the conversion or exchange did not involve any further offer.\n    (12GA) Subsection (12G) does not apply in relation to relevant securities that were issued by reason of the conversion or exchange of regulatory capital securities if, under the terms of the regulatory capital securities at the time they were issued, they must or may be converted into, or exchanged for, ordinary shares in an entity (including an entity that, at the time the regulatory capital securities were issued, does not exist) that, as a result of a restructure (however described) initiated by persons other than the directors of the issuer of the regulatory capital securities or the ultimate holding company of the issuer, will be, at the time of exchange or conversion, the ultimate holding company of the issuer.\n\n#### Sale offer of securities issued on conversion or exchange of regulatory capital securities—case 7\n\n#### (12H) The sale offer does not need disclosure to investors under this Part if:\n\n    (a) the relevant securities were issued by reason of the conversion or exchange of regulatory capital securities in accordance with their terms of issue; and\n    Note: The relevant securities are the underlying securities issued on conversion or exchange of the regulatory capital securities.\n    (b) on the day on which a notice in relation to the regulatory capital securities was given under paragraph (e), there was no determination under subsection 713(6) in force in respect of either:\n      (i) the issuer of the regulatory capital securities; or\n      (ii) if the issuer of the regulatory capital securities is not the issuer of the notional underlying securities—the issuer of the notional underlying securities; and\n    (c) trading in securities in the class of notional underlying securities on the declared financial market on which they are quoted was not suspended for more than a total of 5 days during the shorter of the period during which the class of notional underlying securities were quoted, and the period of 12 months before the first day on which the regulatory capital securities were issued; and\n\n> Note: declared financial market is defined in section 9D. Until the time the first declaration is made under subsection 9D(2), a market that was prescribed as a prescribed financial market by former regulation 1.0.02A of the Corporations Regulations 2001 is taken to be a declared financial market: see section 1705F.\n\n    (d) the conversion or exchange of the regulatory capital securities did not involve any further offer; and\n    (e) a notice that complies with subsection (12I) on the same day as, or within 2 business days before, the first day on which the regulatory capital securities were issued was given to the relevant market operator:\n    (i) if the body that issued the regulatory capital securities is also the issuer of the notional underlying securities—by the body;\n      (ii) if the body that issued the regulatory capital securities is not the issuer of the notional underlying securities—jointly by both the issuer of the regulatory capital securities and the issuer of the notional underlying securities.\n  (12I) A notice complies with this subsection if:\n    (a) the notice contains the following information:\n      (i) for the regulatory capital securities—the information required by subsection 713(2); and\n      (ii) for securities in the class of notional underlying securities—the information required by subsections 713(2) to (5),\n    as if the notice were a prospectus; and\n    (b) the information in the notice is worded and presented in a clear, concise and effective manner; and\n    (c) where the notice includes a statement by a person, or a statement said in the notice to be based on a statement by a person:\n      (i) the person has consented to the statement being included in the notice in the form and context in which it is included;\n      (ii) the notice states that the person has given this consent; and\n      (iii) the person has not withdrawn this consent before the notice is given to the relevant market operator.”.\n\nNote: Subsection 708A(1) of the Act is notionally modified by ASIC Corporations  \n(Non-Traditional Rights Issues) Instrument 2026/98.\n\n  \n\nPart 3—Repeal\n\n10 Repeal\n\nThis instrument is repealed at the start of 1 April 2031.\n\n  \n\nSchedule 1—Repeals\n\nASIC Corporations (Regulatory Capital Securities) Instrument 2016/71\n\n1 The whole of the instrument\n\nRepeal the instrument.","sortOrder":2},{"sectionNumber":"(12H) The sale offer does not need discl","sectionType":"section","heading":"(12H) The sale offer does not need disclosure to investors under this Part if:","content":"#### (12H) The sale offer does not need disclosure to investors under this Part if:\n\n    (a) the relevant securities were issued by reason of the conversion or exchange of regulatory capital securities in accordance with their terms of issue; and\n    Note: The relevant securities are the underlying securities issued on conversion or exchange of the regulatory capital securities.\n    (b) on the day on which a notice in relation to the regulatory capital securities was given under paragraph (e), there was no determination under subsection 713(6) in force in respect of either:\n      (i) the issuer of the regulatory capital securities; or\n      (ii) if the issuer of the regulatory capital securities is not the issuer of the notional underlying securities—the issuer of the notional underlying securities; and\n    (c) trading in securities in the class of notional underlying securities on the declared financial market on which they are quoted was not suspended for more than a total of 5 days during the shorter of the period during which the class of notional underlying securities were quoted, and the period of 12 months before the first day on which the regulatory capital securities were issued; and\n\n> Note: declared financial market is defined in section 9D. Until the time the first declaration is made under subsection 9D(2), a market that was prescribed as a prescribed financial market by former regulation 1.0.02A of the Corporations Regulations 2001 is taken to be a declared financial market: see section 1705F.\n\n    (d) the conversion or exchange of the regulatory capital securities did not involve any further offer; and\n    (e) a notice that complies with subsection (12I) on the same day as, or within 2 business days before, the first day on which the regulatory capital securities were issued was given to the relevant market operator:\n    (i) if the body that issued the regulatory capital securities is also the issuer of the notional underlying securities—by the body;\n      (ii) if the body that issued the regulatory capital securities is not the issuer of the notional underlying securities—jointly by both the issuer of the regulatory capital securities and the issuer of the notional underlying securities.\n  (12I) A notice complies with this subsection if:\n    (a) the notice contains the following information:\n      (i) for the regulatory capital securities—the information required by subsection 713(2); and\n      (ii) for securities in the class of notional underlying securities—the information required by subsections 713(2) to (5),\n    as if the notice were a prospectus; and\n    (b) the information in the notice is worded and presented in a clear, concise and effective manner; and\n    (c) where the notice includes a statement by a person, or a statement said in the notice to be based on a statement by a person:\n      (i) the person has consented to the statement being included in the notice in the form and context in which it is included;\n      (ii) the notice states that the person has given this consent; and\n      (iii) the person has not withdrawn this consent before the notice is given to the relevant market operator.”.\n\nNote: Subsection 708A(1) of the Act is notionally modified by ASIC Corporations  \n(Non-Traditional Rights Issues) Instrument 2026/98.\n\n  \n\nPart 3—Repeal\n\n10 Repeal\n\nThis instrument is repealed at the start of 1 April 2031.\n\n  \n\nSchedule 1—Repeals\n\nASIC Corporations (Regulatory Capital Securities) Instrument 2016/71\n\n1 The whole of the instrument\n\nRepeal the instrument.","sortOrder":3}],"analysis":{"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"},"summary":{"content_quality":"ok","complexity_score":3,"scope_assessment":{"changed":false,"description":"This is a narrow instrument providing specific relief for regulatory capital securities without broader changes to the Act."},"complexity_factors":["detailed modifications to sections 9, 713 and 708A of the Corporations Act","conditional exemptions based on specific criteria","definitions tailored to prudential capital instruments"],"plain_english_summary":"This instrument amends the Corporations Act to ease disclosure for regulatory capital securities (issued by ADIs, general insurers, life companies, their subsidiaries or NOHCs) and the ordinary shares that may result on conversion or exchange, defining “regulatory capital securities” and “notional underlying securities.” It permits simplified prospectuses addressing both securities and, in two limited scenarios, exempts secondary offers of the underlying shares from disclosure where specified notice, timing and trading conditions are met.\n\nIt repeals ASIC 2016/71 and itself expires 1 April 2031."},"kimi_summary":{"content_quality":"ok","complexity_score":7,"scope_assessment":{"changed":false,"description":"This instrument appears to be a straightforward replacement/update of the 2016 instrument (ASIC Corporations (Regulatory Capital Securities) Instrument 2016/71), which is explicitly repealed in Schedule 1. The scope remains focused on regulatory capital securities issued by prudentially regulated financial institutions. While the text contains some duplication/errors in the provided extract, the substantive provisions align with the original purpose of facilitating capital raising by banks and insurers while maintaining investor protections."},"complexity_factors":["Multiple nested definitions with cross-references to other legislation (Banking Act 1959, Insurance Act 1973, Life Insurance Act 1995)","Complex conditional logic in the definition of 'regulatory capital security' with multiple tiers of subparagraphs (i), (ii), (A), (B), (C), (I), (II)","Notional modifications to the Corporations Act (Chapter 6D, sections 9, 713, 708A) requiring readers to understand the base text and the modifications simultaneously","Cross-references to other ASIC instruments (2026/97, 2026/96, 2026/98) that notionally modify the same sections","Multiple exceptions and carve-outs, including the third-party acquisition scenario in section 8(8) and the exclusion in subsection 12GA","Timing and procedural requirements with multiple conditions (e.g., 'within 2 business days before', 'shorter of the period')","Dual issuer scenarios requiring joint notices and consents when the regulatory capital security issuer differs from the underlying securities issuer","Defined terms used within definitions (e.g., 'authorised NOHC', 'registered NOHC', 'continuously quoted securities', 'declared financial market')","Sunset provision and repeal of prior instrument creating temporal complexity"],"plain_english_summary":"This legislation is an ASIC (Australian Securities and Investments Commission) instrument that creates special rules for how banks, insurers, and life insurance companies can issue and sell certain types of financial instruments called \"regulatory capital securities.\"\n\n**What are regulatory capital securities?**\nThese are special investments (like bonds or hybrid securities) issued by financial institutions that can be converted into ordinary shares (company stock) under certain conditions. Banks and insurers use these to meet their regulatory capital requirements—the money they must hold to stay financially stable.\n\n**What does this instrument do?**\n\n1. **Defines key terms**: It creates definitions for:\n   - **Regulatory capital security**: A security issued by banks, insurers, or life companies that converts into ordinary shares\n   - **Notional underlying securities**: The hypothetical shares that would be issued if conversion happened immediately\n   - Updates the definition of \"underlying securities\" to include these converted shares\n\n2. **Prospectus requirements**: When banks issue these securities, they must provide a prospectus (a legal document explaining the investment) that includes:\n   - Information about the regulatory capital security itself\n   - Information about the shares it converts into\n   - If the shares are issued by a different company, that company must consent to statements made about it\n\n3. **Exemptions from disclosure**: Normally, when you sell securities, you need to give buyers detailed disclosure documents. This instrument creates two exemptions (ways to skip full disclosure) when selling shares that result from converting these regulatory capital securities:\n\n   - **Case 6**: No disclosure needed if the original regulatory capital security was issued under a prospectus and the conversion didn't involve a new offer\n   - **Case 7**: No disclosure needed if specific conditions are met, including:\n     - No suspension of trading in the underlying shares for more than 5 days in the relevant period\n     - A notice was given to the stock exchange with specific information\n     - The notice was clear, concise, and effective\n\n4. **Third-party acquisition carve-out**: The special rules don't apply if the conversion involves shares in a company that becomes the ultimate holding company through a restructure initiated by outsiders (not the company's own directors).\n\n**Who does this affect?**\n- Banks (authorised deposit-taking institutions)\n- General insurers\n- Life insurance companies\n- Their holding companies\n- Investors who buy these securities\n- Anyone selling shares received from converting these securities\n\n**Why does it matter?**\nThis makes it easier and cheaper for financial institutions to raise capital while still protecting investors. Without these exemptions, every conversion of these securities into shares would require expensive disclosure documents, making these financial products less practical to use.\n\n**Sunset clause**: This instrument automatically expires on 1 April 2031 and replaces an earlier 2016 instrument."},"flash_summary":{"complexity_score":7,"scope_assessment":{"changed":true,"description":"This instrument changes scope by expressly extending Chapter 6D to cover 'regulatory capital securities' and their notional underlying securities, and by creating new, conditional exemptions to prospectus/disclosure obligations for sale offers of converted shares (see Part 2, ss 7–9). It also adds procedural constraints (issuer consent, market notices, suspension tests) and excludes scenarios involving third‑party initiated restructures, thereby narrowing the situations in which the disclosure exemption applies compared with a simple conversion‑linked exemption (see ss 8(2A), 8(8), 9(12G)–(12I), 9(12GA))."},"complexity_factors":["Multiple new definitions and reclassifications (notional underlying securities; regulatory capital security; underlying securities) that alter foundational meaning across Chapter 6D (see Part 2, s 7).","Layered conditional disclosure exemptions tied to three separate tests (12G, 12H, 12I) with different procedural and timing requirements (see Part 2, s 9).","Consent requirement where issuer of notional underlying securities differs from issuer of regulatory capital securities — adds a third‑party document signoff and non‑withdrawal timing constraint (see Part 2, s 8(2A)).","Carve‑out for restructures initiated by third parties (excludes certain situations from the exemption) — requires factual enquiry about the initiator of a restructure (see Part 2, ss 8(8), 9(12GA)).","Operational market test: trading suspension cap (not more than 5 days in a specified period) introduces a market‑monitoring compliance check (see Part 2, s 9(12H)(c)).","Notice content and form must mirror prospectus requirements for multiple subsections and include consent statements; notice timing is strict (on the day or within 2 business days before issue) (see Part 2, s 9(12I) and 9(12H)(e)).","Heavy cross‑instrument interaction: references to prudential standards, declared financial markets and other ASIC instruments modifying sections of the Act increase interpretive complexity (see ss 7, 8, 9 and notes).","Temporal/repeal element: instrument is time‑limited (repealed 1 April 2031) and repeals a prior ASIC instrument, affecting transitional and long‑term compliance planning (see Part 3, s 10 and Schedule 1)."],"plain_english_summary":"This instrument amends Chapter 6D disclosure rules to treat certain \"regulatory capital securities\" (issued by ADIs, insurers, life companies and their NOHCs) and the shares they convert or exchange into as \"underlying securities\", and creates limited circumstances where sale offers of those converted shares do not require a prospectus. It adds issuer-consent and market-notice requirements, carve-outs for restructures initiated by third parties, and timing and suspension tests that change who must provide disclosure and when — affecting issuers, market operators and investors."}},"importantCases":[],"_links":{"self":"/api/acts/asic-corporations-regulatory-capital-securities-instrument-2026-88","history":"/api/acts/asic-corporations-regulatory-capital-securities-instrument-2026-88/history","analysis":"/api/acts/asic-corporations-regulatory-capital-securities-instrument-2026-88/analysis","conflicts":"/api/acts/asic-corporations-regulatory-capital-securities-instrument-2026-88/conflicts","importantCases":"/api/acts/asic-corporations-regulatory-capital-securities-instrument-2026-88/important-cases","documents":"/api/acts/asic-corporations-regulatory-capital-securities-instrument-2026-88/documents"}}