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PRACTICE AND PROCEDURE - Summons for production of documents - application to set aside Summons - challenge to relevance of documents relating to banning and disqualifications orders made by ASIC against a third party - whether a real possibility that documents may assist in the resolution of the issues in the proceeding - Summons set aside

Administrative Review Tribunal Act 2024 (Cth) s. 52, 74, 79

Australian Securities and Investments Commission Act 2001 (Cth) s. 12CB

Corporations Act 2001 (Cth) ss. 206F, 911B, 916A, 920A, 920B, 1041H

Federal Court Rules 2011 (Cth) r. 20.14

Australian Securities and Investments Commission v Union Standard International Group Pty Ltd (No 3) [2022] FCA 1147

Australian Securities and Investments Commission v Union Standard International Group Pty Ltd (No 4) [2024] FCA 1481

Comcare v Maganga [2008] FCA 285

Cosco Holdings Pty Ltd v Federal Commissioner of Taxation [1997] FCA 1504

General Merchandise and Apparel Group Pty Ltd and CEO, Customs [2009] AATA 988; (2009) 114 ALD 289

Jones and National Disability Insurance Agency [2024] AATA 1142

Marnotta Pty Ltd and Secretary, Department of Health and Ageing [2004] AATA 800

Visnic v Australian Securities and Investments Commission [2007] HCA 24; (2007) 231 CLR 381

World Brand Importers Pty Ltd and Commissioner of Taxation [2025] ARTA 95

ASIC Regulatory Guide 104: AFS licensing: Meeting the general obligations

1. The substantive application for review in this proceeding[1] is concerned with the decision of the Respondent (ASIC) made on 2 May 2024 (Reviewable Decision) to ban the Applicant (Mr Sasso) for a period of 5 years under sections 920A and 920B of the Corporations Act 2001 (Cth) (Corporations Act).
2. The Reviewable Decision was based on the findings of ASIC's Delegate that:

"I. ASIC has reason to believe that Pedro Eduardo SASSO is not adequately trained, or is not competent to perform one or more functions as an officer of an entity that carries on a financial services business or control an entity that carries on a financial services business; and

II. ASIC has reason to believe that Mr Sasso is not a fit and proper person to provide one or more functions as an officer of an entity that carries on a financial services business or control an entity that carries on a financial service[s] business."

1. performing one or more functions as an officer of an entity that carries on a financial services business; and
2. Controlling, whether alone or in concert with one or more entities, an entity that carries on a financial services business."[2]

1. On 7 February 2025, the Tribunal issued a Summons to Produce Documents (Summons) addressed to ASIC.[3] The Summons was issued in response to Mr Sasso's Request to Issue Summons dated 17 January 2025 (Request) which sets out reasons for the Request in its Annexure A (Request Annexure A).
2. Mr Sasso's Request Annexure A states the following matters:

1. Mr Sasso was a director of Maxi EFX Global AU Pty Ltd (EFX), which was appointed as an authorised representative (CAR) of Union Standard International Group Pty Ltd (USG), under section 916A of the Corporations Act, to conduct a business of issuing contracts for difference (CFDs) to customers in Australia.[4]

1. USG held an Australian financial services license (AFSL) for issuing CFDs and John Martin (Mr Martin) was a director of, and the Responsible Manager for, USG.[5] 2. On 1 June 2021, ASIC banned Mr Martin from providing financial services for 10 years and disqualified him from managing corporations for 5 years. The banning and disqualification orders were based on findings by ASIC that Mr Martin was involved in the failures by USG to ensure that the financial services provided under its AFSL were provided efficiently, honestly, and fairly and to take reasonable steps to ensure that its authorised representatives, including EFX, complied with financial services laws.[6] and 3. The allegations made by ASIC against Mr Sasso, as a director of EFX, are said to be "derivative of and must be viewed in light of the findings found against Mr Martin and USG." The circumstances of the failings of Mr Martin were said to be relevant to the case brought by ASIC against Mr Sasso.[7]
2. On 19 February 2025, ASIC notified the Tribunal and Mr Sasso that it objected to the Summons on the grounds that "the documents sought are not relevant to the issues in the review."[8]
3. The present interlocutory hearing is for the purpose of determining ASIC's application to set aside the Summons.
4. ASIC relies upon its written Submissions re Application to Set Aside Summons dated 5 March 2025 (Respondent's Submissions). Mr Sasso relies upon his written Submissions re the Summons to Produce Documents dated 19 March 2025 (Applicant's Submissions). Mr Sasso has also provided an Interlocutory Hearing Bundle (Applicant's Hearing Bundle), to which reference will be made in these Reasons.
5. The Summons seeks production by ASIC of 4 categories of documents as follows:

"In respect of the banning order issued by ASIC against John Carlton Martin on or about 1 June 2021, by which ASIC banned Mr Martin from providing financial services for 10 years:

1. The Notice and Areas of Concern issued by ASIC to Mr Martin, pursuant to section 920A of the Corporations Act; and

2. The statement of reasons in respect of the banning order.

In respect of the order issued by ASIC against Mr Martin on or about 1 June 2021 disqualifying Mr Martin from managing corporations for 5 years:

[3.] the notice and any document recording the areas of concern (howsoever described) issued by ASIC to Mr Martin, pursuant to section 206F(1)(b) of the Corporations Act; and

[4.] the statement of reasons in respect of the notice of disqualification issued to Mr Martin."

1. The Summons Documents relate to the making of, and the reasons for, the banning order made against Mr Martin by ASIC and the disqualification of Mr Martin by ASIC from managing corporations.
2. On 4 April 2025, Mr Sasso's solicitors advised the Tribunal that Mr Sasso had received from Mr Martin a copy of the ASIC delegate's reasons dated 19 May 2021 for the banning order made against Mr Martin under section 920A of the Corporations Act. Accordingly, production of item 2 in the Summons was not pressed by Mr Sasso at the hearing.
3. ASIC's fundamental objection to production of the Summons Documents is that the failings of Mr Martin as director and Responsible Manager of USG are entirely irrelevant to the failings of Mr Sasso in his capacity as sole director of EFX.[9] ASIC further submits that the Summons Documents were created in relation to the administrative processes[10] conducted by ASIC against Mr Martin under sections 920A and 206F of the Corporations Act.[11] The underlying primary documents of EFX and/or USG which supported and provided the evidence for those administrative processes are not the subject of the Summons[12].
4. Further, these primary documents are documents which are known to and are otherwise available to the parties for the substantive hearing of the application for review. They are said by ASIC to be known to Mr Sasso and his legal team as they have already been admitted into evidence in earlier civil penalty litigation brought by ASIC against USG and EFX.[13]
5. The Tribunal's power to issue a summons to produce documents is set out in section 74(1)(b) of the Administrative Review Tribunal Act 2024 (Cth) (ART Act). The recipient of a summons can then object to the documents sought in the summons being produced for inspection,[14] and make an interlocutory application to have the Tribunal set aside the summons.
6. The Tribunal is not bound by the rules of evidence,[15] but those rules provide valuable guidance to the Tribunal in its receipt of evidence from the parties. As Deputy President Mischin stated in Jones and National Disability Insurance Agency[16] (Jones), the "fundamental touchstone" for the Tribunal in receiving evidence is its "... relevance to the issue or issues to be determined in the proceedings."[17]
7. The Deputy President went on to set out the relevant principles to be applied by the Tribunal, drawing upon the decisions in Comcare v Maganga[18] (Maganga), Cosco Holdings Pty Ltd v Federal Commissioner of Taxation[19] (Cosco) and Marnotta Pty Ltd and Secretary, Department of Health and Ageing[20] (Marnotta):

"15. The test of relevance is: ... whether the documents relate to the proceedings such that there is a real possibility that they may assist in the resolution of issues in the proceedings.[21] or ... that the material sought could reasonably be expected to throw light on some of the issues in the principal proceedings.[22]

16. There should be a legitimate forensic purpose in seeking the relevant documents which 'must be identifiable, and likely to facilitate the conduct of the proceeding, not merely to oppress a party or witness'.[23] Such legitimate forensic purpose is not limited to admission into evidence, but use in cross-examination, and includes cross-examination going to the question of credit of a witness.[24]

17. However a summons should not be issued if it serves an improper purpose, such as a "fishing expedition".[25] "

1. A detailed and frequently cited statement of the principles governing the concept of relevance as it applies when the Tribunal is considering whether to set aside a summons is to be found in General Merchandise and Apparel Group Pty Ltd and CEO, Customs (General Merchandise)[26] at paragraphs [203] and following. General Merchandise was recently cited, with Cosco, as a leading decision on the powers of the Tribunal regarding summonses, and applied, by Deputy President Thompson in World Brand Importers Pty Ltd and Commissioner of Taxation[27]. In all events, the practical tests of relevance to be applied by the Tribunal in this context are the "real possibility that that they may assist" test or the "could reasonably be expected to throw light on some of the issues" test referred to above.
2. ASIC submits that the Summons Documents are not relevant because:

1. ASIC's concerns about Mr Sasso are not "derivative" of ASIC's concerns raised against Mr Martin or USG. The latter concerns were raised under section 912A of the Corporations Act and relate to USG's conduct as the holder of an AFSL. In contrast, the ASIC concerns about Mr Sasso and EFX relate to breaches of general application, namely that EFX: 1. provided personal advice to clients, while unauthorised, in breach of section 911B(1) of the Corporations Act. 2. engaged in conduct that misled or deceived clients, or was likely to do so, in breach of section 1041H of the Corporations Act. and 3. engaged in unconscionable conduct towards clients in breach of section 12CB of the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act).[28]

b) ASIC's concerns about Mr Sasso stand independently of its concerns about Mr Martin and USG because they concern the conduct of EFX and whether Mr Sasso, in his capacity as the sole director of EFX, has properly discharged his director's duties.[29] ASIC submits on this point:

"Whether Mr Martin caused or permitted USG to supervise its CARs inadequately, such that USG also breached its own obligations under the ASIC Act and/or Corporations Act ... is not relevant to an assessment of [EFX's] conduct, nor an assessment of the conduct of [EFX's] sole director."[30]

1. the Summons Documents were, and are, documents prepared by ASIC's employees in conducting the administrative processes against Mr Martin which record statements as to the opinions of those ASIC employees. ASIC contends on this point:

"There is no real possibility that the opinions of an ASIC delegate in relation to a different banning decision, based on different materials, could assist in the resolution of issues in the present administrative review application."[31]

1. The Respondent's Submissions refer to the decision of Wigney J in Australian Securities and Investments Commission v Union Standard International Group Pty Ltd (No 3)[32] (USG (No 3)). In that case, EFX sought discovery, under rule 20.14 of the Federal Court Rules 2011 (Cth) of the same documents as the Summons Documents. Wigney J refused EFX's application for discovery on the basis that the approach taken by ASIC in the administrative proceedings against Mr Martin and USG was almost certain to be irrelevant in the civil penalty proceedings brought by ASIC against EFX which was before the Court.[33]
2. In response to the Respondent's Submissions, Mr Sasso submits that the Tribunal should uphold the Summons because the documents sought "have a real possibility of assisting the Tribunal in determining whether a banning order ought to have been made against the Applicant, and if so, whether the sanction imposed was appropriate."[34] Mr Martin's conduct is said to be relevant to understanding the alleged conduct of Mr Sasso and EFX.[35] Mr Sasso further contends that the documents to be produced in answer to the Summons are relevant "...to the issue of the objective seriousness of the alleged conduct (if established) and the appropriate sanction (if any) to be imposed on the Applicant."[36]
3. Mr Sasso says that he will contend at the substantive hearing of the application for review that USG retained oversight of compliance related matters in respect of the financial services and products provided by USG under its AFSL,[37] and that he "... as a director of [EFX] was reliant on USG's discharge of the Section 912A Obligations."[38] Mr Sasso contends that ASIC's allegations against him, in his capacity as director of EFX, must be viewed in light of the failings found against Mr Martin and USG.[39]
4. Mr Sasso submits that ASIC's statement to the effect that the Summons Documents merely record the opinions of ASIC officers, seeks to downplay the significance of those opinions because they are "... the concluded and reasoned view of an ASIC delegate", and, as such, those opinions in fact represent ASIC's position.[40]
5. Mr Sasso accepts that the parties already have access to the documents comprising the primary evidence in the ASIC administrative processes against Mr Martin and USG, but:

"... what the Summons seeks and what ASIC resists are the documents recording ASIC's state of mind in respect of the same or similar documents with respect to Mr Martin. The fact of ASIC having recorded conclusions in respect of the conduct of Mr Martin is relevant and has the potential to be highly probative in aid of the Applicant's case."[41]

1. Finally, Mr Sasso rejects the decision in USG (No 3) as irrelevant, because he was not a party to those civil penalty proceedings, which dealt with different legal questions.[42]
2. At the substantive hearing, the Tribunal will be examining the conduct of Mr Sasso as sole director and the controlling mind of EFX in the context of EFX acting as a CAR of USG. Mr Sasso had obligations and duties in his capacity as a director of EFX to ensure that EFX was compliant with the law. Mr Sasso will have an opportunity at the final hearing of his application for review to fully develop his argument that ASIC's concerns about Mr Sasso and EFX are "derivative" of the concerns raised by ASIC against Mr Martin and USG.
3. The parties agree that Mr Sasso has available to him the primary documentary evidence relating to the conduct of Mr Martin and USG which grounded the ASIC concerns, which will enable Mr Sasso to run his "derivative" liability argument at the substantive hearing. The Tribunal agrees with ASIC's submission that it is unlikely that documents which go to the subjective state of mind of the ASIC delegates in 2021 about possible breaches of the law by USG, as the holder of an AFSL, and about Mr Martin's involvement in USG's breaches, will shed any further light on the issues concerning Mr Sasso and EFX than the available primary documentary evidence as to the conduct of Mr Martin and USG already do. The Tribunal agrees with ASIC's submission that even if the Tribunal were to be persuaded on the evidence at the final hearing that Mr Martin's conduct is of relevance to ASIC's concerns about the conduct of Mr Sasso and EFX, it is difficult to see how the subjective views of ASIC officers in 2021 as to the conduct of Mr Martin and USG can assist the Tribunal in its review.
4. The Tribunal agrees with Mr Livingston's submission that the issues identified by Mr Sasso in paragraph [28 (a) - (c)] of the Applicant's Submissions as falling for determination by the Tribunal at the substantive hearing, will not necessarily arise at all for the purpose of determining the central issues as to whether Mr Sasso was adequately trained and/or was a fit and proper person to fulfill the functions as an officer in control of an entity conducting a financial services business.
5. Counsel for Mr Sasso, Mr Tao, made submissions seeking to tie the conduct of USG and Mr Martin on the one hand, and EFX and Mr Martin on the other, closely together. In broad terms he sought to contrast the rigour imposed by the statutory provisions on the holder of the AFSL with the comparative lack of rigour imposed on the CAR, which contrast would give rise to an expectation that the license holder would take positive steps to ensure that Mr Sasso was providing proper services as the person in control of the licensee's authorised representative.
6. Mr Tao went on to say that this would give rise to a contest of fact at the hearing about the appropriate division of responsibility between the licensee and the authorised representative. The Tribunal was taken by counsel to several provisions in ASIC Regulatory Guide 104: AFS licensing: Meeting the general obligations[43] (RG 104), which were said to illustrate the high expectations imposed by ASIC on licensees in respect of their representatives in relation to matters including supervision, training and competence.[44]
7. The matters raised by Mr Sasso's counsel can all be put to the Tribunal in due course at the final hearing, supported, as is appropriate, by primary evidence. The Tribunal is not persuaded that not having the Summons Documents will detract from Mr Sasso's ability to present any of his arguments at the final hearing. Nor am I persuaded that having the Summons Documents will assist the Tribunal in determining the application for review.
8. On the latter point, the Tribunal agrees with ASIC's counsel that an exploration of the thinking or state of mind of ASIC's delegates in 2021 about Mr Martin and USG is more likely to be a distraction for the parties and Tribunal rather than of assistance. The Tribunal will have the benefit of considerably more material before it in 2025 than was available to ASIC in 2021. The Summons Documents will likely provide no more than a considered but subjective snapshot of the ASIC delegates' views in 2021 about the conduct of Mr Martin and USG, in circumstances where things have otherwise moved on.
9. It was also submitted by Mr Tao that ASIC's position in relation to Mr Martin and USG, as recorded in the Summons Documents, should be considered by the Tribunal at the substantive hearing for the purpose of seeking to avoid inconsistent factual findings being reached in its merits review of the Reviewable Decision.
10. The Tribunal accepts that there is always a risk of some inconsistency in the findings in separate matters when parties who share some common facts find themselves in different hearings in different settings at different times. That is a risk which the Tribunal manages, with the assistance of the parties, in the normal course. That risk will not be abated, in my view, by the Tribunal and the parties having access to the Summons Documents. I note in this context the statement in USG (No 3), where the Court said of the possible inconsistencies of approach in the administrative proceedings involving Mr Martin and the subsequent civil penalty proceedings involving USG and EFX:

"... In any event, ASIC is not in any relevant sense bound by the approach it took in an entirely different proceeding at a different point in time based on different materials."[45]

1. The Tribunal is not persuaded on the material before it that there is a real possibility that the Summons Documents may assist it in the resolution of the issues in the substantive proceedings, or that the Summons Documents could reasonably be expected to throw light on some of the issues at the substantive hearing. It follows that the Tribunal has decided that ASIC's objection to the Summons is well founded and the Summons should be set aside.

Solicitors for the Applicant: Mr T Woodford and Ms M Pakchury, Piper Alderman

Counsel for the Respondent: Mr L Livingston SC and Mr David Birch

Solicitors for the Respondent: Ms G Wong and Ms A Rees, Legal Services ASIC

[1] Application for Review of Decision dated 8 May 2024 - Applicant's Hearing Bundle, pages 22 - 27.

[2] Applicant's Hearing Bundle, pages 28 - 46, at page 29.

[3] Applicant's Hearing Bundle, pages 1 - 2.

[8] Email dated 19 February 2025 from Gloria Wong to the Tribunal's Sydney Registry.

[10] The processes are administrative rather than judicial processes: Visnic v Australian Securities and Investments Commission [2007] HCA 24; (2007) 231 CLR 381, 388 - 389, [28].

[12] Respondent's Submissions, [14] - [17].

[13] Australian Securities and Investments Commission v Union Standard International Group Pty Ltd (No 4) [2024] FCA 1481, [758] - [759], [1366] - [1368], [1372], [1407], [1421]; Respondent's Submissions, [29].

[16] [2024] AATA 1142.

[17] [2024] AATA 1142, [14].

[18] [2008] FCA 285.

[19] [1997] FCA 1504.

[20] [2004] AATA 800.

[22] Citing Cosco, [11] and Marnotta, [42].

[24] Citing Maganga, [32], [34], [36], [38].

[26] [2009] AATA 988; (2009) 114 ALD 289.

[27] [2025] ARTA 95, [11] - [12].

[28] Respondent's Submissions, [21] - [24].

[32] [2022] FCA 1147; Respondent's Submissions, [30].

[33] [2022] FCA 1147, [37].

[35] Applicant's Submissions, [2(g)].

[36] Applicant's Submissions, [2(h)].

[37] Applicant's Submissions, [19(b)]

[43] Applicant's Hearing Bundle, pages 190 - 226.

[44] RG 104.67, RG 104.70, RG 104.71, RG 104.73, RG 104.75, RG 104.81; Applicant's Hearing Bundle, pages 210 - 212.

[45] [2022] FCA 1147, [36].