ASIC Corporations (Sale Offers That Do Not Need Disclosure) Instrument 2026/94

The instrument rests on several discrete legal and market concepts carried into the Corporations Act by the textual substitutions it prescribes. These concepts are textual; the instrument itself defines or locates them within the Act rather than creating new policy language outside the Act.

• On-sale within 12 months: The instrument reworks the Act’s existing treatment of offers made “within 12 months after their issue” (see the substituted text of subsection 707(3) in s 7(1) and the parallel substitution for subsection 1012C(6) in s 7(2)). The 12-month window remains the operative temporal limit. The trigger remains an offer for sale within that period, but liability to disclosure under Chapter 6D or Part 7.9 is now made conditional on the purpose of the original issue.

• Purpose of the recipient: A central textual concept is the test that the securities were issued “with the purpose of the person to whom they were issued” selling, transferring, or granting interests in the securities or financial product (s 7(1)(b)(i)-(ii) and s 7(2)(c)). The instrument thus imports an intention-based factual element into the on-sale analysis: it is not merely the occurrence of a secondary sale within 12 months that automatically triggers disclosure; the initial issue must have been made with a purpose that contemplates the recipient reselling or transferring.

• Exempt categories: The instrument does not abolish the on-sale rule entirely. Instead it confines its application to securities or interests that are “covered by an exempt category” (s 7(3)-(4)). There are seven specific categories: share or interest purchase plans (Category 1, which expressly references ASIC Corporations (Share and Interest Purchase Plans) Instrument 2019/547 and similar individual ASIC instruments), conversion/exercise outputs (Category 2), dividend/distribution reinvestment or bonus plans (Category 3), compromises and arrangements (Category 4), deeds of company arrangement (Category 5), takeovers (Category 6), and securities of exempt public authorities (Category 7) (s 7(4) Categories 1-7). Each category has an express textual hook to existing subsection exceptions of the Act or to ASIC instruments.

• Interaction with existing disclosure exceptions: The substituted on-sale text expressly saves the operation of existing sections 708 and 708A by stating the new on-sale paragraphs apply “and section 708 or 708A does not say otherwise” (s 7(1) and note in s 7(3) context). That retains other statutory carve-outs that may operate independently to disapply disclosure obligations.

• Stapled securities as distinct quoted classes for trading and suspension: The instrument inserts model text into sections 708A and 1012DA to treat component securities that are only transferable as part of a stapled security as if they formed a distinct quoted class for market classification and to treat their trading as suspended when trading in the stapled class is suspended (s 8(1)-(2)). This is a market-operational concept: it changes how quoted-class status and suspension operate when stapling prevents component securities being traded alone.

• Temporal and transitional dimensions: The instrument sets a commencement rule (later of registration and 1 April 2026, s 2) and a sunset (repeal at start of 1 April 2031, s 9). It also expressly repeals the earlier ASIC 2016/80 instrument (Schedule 1).

These are the instrument’s core textual concepts. They are deliberate modifications to the Act’s mechanics rather than standalone regulatory policy statements. The “purpose” element, the category-based gating, and the stapled-security market mechanics are the principal substantive changes that will determine how market participants and advisers read the on-sale rules and how market operators treat stapled products.

The instrument affects a defined set of market participants by changing how the Corporations Act applies to them. Who is affected and how depends on the nature of the product, the manner and purpose of issue, and whether the market trades stapled products.

• Issuers and offerors: Corporations and other issuers who issue securities, or managed investment scheme issuers who issue interests, are directly affected because the instrument changes whether subsequent offers for sale within 12 months will attract disclosure obligations. The instrument’s categories (s 7(4)) identify common issuer activities , share/interest purchase plans, dividend reinvestment plans, conversions on exercise of options, compromises and arrangements, deeds of company arrangement, takeover-related issues, and securities of exempt public authorities , and so issuers engaged in those activities will need to consider whether their issues fall within an exempt category.

• Recipients of issues (initial holders): The substituted on-sale provisions test the purpose of the person to whom securities were issued, i.e. the initial recipient. Where securities were issued to a person with the purpose that they would sell or transfer them (s 7(1)(b), s 7(2)(c)), then the subsequent sale within 12 months may attract disclosure unless an exempt category applies. Therefore, placement participants, plan participants in share purchase plans, offerees under offers covered by ASIC instruments, and recipients under takeovers or restructuring arrangements are affected.

• Regulated persons under Part 7.9: The instrument explicitly modifies the equivalent Part 7.9 on-sale provisions for “regulated persons” (as defined in s 1011B of the Act) by substituting new subsections 1012C(6)-(7) (s 7(2)). Therefore financial services businesses that are regulated persons offering or issuing financial products must apply the new text when assessing product disclosure requirements for on-sales within 12 months.

• Investors and secondary-market buyers: Investors who acquire securities or interests that were issued within the previous 12 months, particularly where those securities were issued under one of the exempt categories, will find that the availability of disclosure for the on-sale depends on the exempt-category status and the purpose test. This affects the information environment for those buyers because an offer for sale may not automatically be accompanied by disclosure mandated under Chapter 6D or Part 7.9.

• Market operators and operators of declared financial markets: The stapled-securities modification (s 8(1)-(2)) directly references trading on a declared financial market and the concept of trading suspension. Market operators that list or trade stapled securities will be affected because the instrument prescribes how a component security is to be taken to be in a distinct quoted class and how suspension of trading is to operate.

• Advisers, lawyers, accountants and compliance officers: Because the instrument injects an intention-based “purpose” test and uses specific exempt categories often reliant on other ASIC instruments (for example, ASIC Corporations (Share and Interest Purchase Plans) Instrument 2019/547 is expressly referenced, s 7(4) Category 1), advisers will need to document and advise on whether the purpose test is met, whether the instrument relied on is the designated ASIC instrument or an individual ASIC instrument, and whether the conversion/exercise criteria are satisfied (Category 2(b)-(c)). They will also need to advise on stapling market mechanics and the practical consequences for trading and suspensions.

• ASIC and its delegates: The instrument is made by an ASIC delegate under ss 741(1) and 1020F(1) of the Act (s 3). It also contemplates ASIC-made individual instruments that may provide relief similar to ASIC Corporations (Share and Interest Purchase Plans) Instrument 2019/547 (s 7(4) Category 1(b)). ASIC’s role in issuing individual instruments and declaring financial markets remains implicated by the instrument’s cross-references.

• Holders and administrators of managed investment schemes and notified foreign passport funds: The instrument explicitly applies to “interests in a managed investment scheme or interests in a notified foreign passport fund” where those interests are offered for sale or a recommendation to acquire is made by way of transfer (s 7(3)). Trustees, responsible entities and administrators must apply the new text.

Who bears costs or processes? The practical compliance cost will fall primarily on issuers and their advisers in documenting purpose and qualifying for categories; market operators will need to adjust market-classification and suspension processes; investors may face reduced disclosure in certain secondary transactions. The instrument establishes who decides key legal questions (whether an issue is within an exempt category, whether the purpose test is met) through statutory wording that will be interpreted against factual records and surrounding market documentation.

This instrument adjusts duties and rights by altering the circumstances in which statutory disclosure duties arise and by clarifying market treatment of stapled securities. The instrument does not itself introduce new duties outside the Act; rather it changes how existing duties in the Corporations Act apply.

• Duty to provide disclosure on an on-sale within 12 months: Under the substituted text, an offer of a body’s securities for sale within 12 months after issue “needs disclosure to investors under this Part” only if the body issued the securities without disclosure and with the purpose that the recipient would sell, transfer, or grant interests/options over them, and provided section 708 or 708A does not say otherwise (s 7(1)). Mechanical effect: the disclosure duty that would otherwise follow an on-sale within 12 months is now conditional on the nature of the initial issue and the purpose attributed to the original recipient.

• For regulated persons and product disclosure statements: The parallel substitution for subsection 1012C(6) in s 7(2) provides that, for regulated persons, the product will attract the Part 7.9 on-sale coverage only if (a) the offer is within 12 months, (b) the product was issued without a Product Disclosure Statement (PDS), and (c) the issuer issued the product with the purpose that the person would sell or transfer it or grant interests/options/warrants over it. This defines the circumstances in which regulated persons need to prepare or rely on a PDS for secondary offers. It places a duty on regulated persons to assess (and be able to evidence) whether the product was issued with such a purpose.

• Right to rely on exempt categories: The instrument creates an entitlement to treat certain classes of issues as “covered by an exempt category” (s 7(3)-(4)). When an issue clearly fits within one of the seven categories, parties can treat an on-sale within 12 months in the specified way. For example, for Category 1 (share or interest purchase plans), if the initial issue was covered by ASIC Corporations (Share and Interest Purchase Plans) Instrument 2019/547 (or an ASIC individual instrument providing similar relief), then the securities are within the exempt category and the on-sale substitutions apply in the defined manner (s 7(4) Category 1(a)-(b)).

• Burden of proof and documentation: While the instrument does not prescribe evidentiary mechanics, the insertion of an intention-based “purpose” test implies that parties relying on the substitution must have documentary or factual support to justify the asserted purpose. The substituted text makes the purpose of the recipient a statutory element; in practice that will require issuers, intermediaries and advisers to document offer terms, subscription agreements, board minutes or other contemporaneous records demonstrating the purpose at issue.

• Trading and suspension rights for stapled securities: The inserted paragraph in 708A (and parallel in 1012DA) treats component securities or products that are only transferable as part of a stapled bundle as being in a distinct quoted class for the times they are so transferred, and also treats trading in that class as suspended when trading in the stapled class is suspended (s 8(1)-(2)). Operationally this affects who has the right to trade and when: a component security’s quoted-class identity and its trading status depend on the stapled structure’s trading status.

• Limits and saving provisions: The substituted on-sale text explicitly preserves the operation of other statutory exceptions by stating the new on-sale condition applies “and section 708 or 708A does not say otherwise” (s 7(1)). The instrument therefore does not override all other statutory carve-outs; rights and duties continue to be shaped by the wider statutory regime.

• Time-limited effect and repeal: The instrument itself is time-limited, repealing on 1 April 2031 (s 9). Parties’ rights to rely on the instrument therefore have a temporal boundary: transactions effected after repeal will not benefit from these textual modifications unless replaced or extended by further legislative action.

In summary, the instrument alters the duty to provide disclosure on an on-sale within 12 months by making that duty contingent on the type of original issue (categorised) and on an intention/purpose element, while conferring a market-operational right to treat stapled components as distinct quoted classes for the purposes of suspension and trading classification.

The legislative instrument itself does not create new offences or specify distinct penalty regimes; it operates by altering how existing parts of the Corporations Act are to be read and applied. The instrument is authorised by subsections 741(1) and 1020F(1) of the Corporations Act (s 3), which are the statutory powers that permit ASIC to make such instruments; it does not include any standalone criminal, civil penalty, or administrative enforcement provisions within its text.

Because the instrument modifies the application of Chapter 6D and Part 7.9 of the Corporations Act, enforcement of the duties and obligations that it affects remains a matter of applying the Act as so modified. For example, the substituted text in s 7(1) and s 7(2) changes when an offer “needs disclosure to investors under this Part” or when the Part 7.9 coverage applies, which will in turn affect whether later contraventions of disclosure duties can be established under the Act’s general enforcement provisions. The instrument does not itself set evidentiary standards or penalty amounts; those continue to be supplied by the bodies of the Act that govern breaches of disclosure obligations, civil liability and criminal sanctions.

Practical enforcement implications that flow from the instrument’s text include:

• Shifts in trigger points for enforcement: Enforcement authorities and private plaintiffs must now assess whether an initial issue falls within one of the exempt categories in s 7(4), whether the issuance was “without disclosure” or “without a PDS” as applicable, and whether the issuer’s purpose was that the recipient would sell or transfer within 12 months (s 7(1)-(2)). If an enforcement action arises from a secondary offer, these factual elements will determine whether the statutory disclosure duty was engaged.

• Evidence of purpose: Because the substituted on-sale rule includes a purpose-based element, enforcement bodies will need to grapple with evidence of the issuer’s or recipient’s purpose at the time of issue. The instrument does not itself prescribe how purpose is proved. This increases emphasis on contemporaneous documentation, communications, offer terms and any ASIC instrument relied upon (for example, the ASIC 2019/547 instrument referenced in Category 1).

• Market-operation consequences for stapled securities: The changes to s 708A and 1012DA (inserted paragraph (13) in s 8) create a statutory rule on quoted-class identity and suspension for stapled components. Compliance and enforcement as to trading suspension will be governed by market rules and the Act’s provisions concerning declared financial markets; the instrument does not create new direct offences but changes the legal characterisation that market operators and regulators must apply in suspension situations.

• ASIC’s instruments and discretion: Category 1 expressly references individual ASIC instruments that provided relief in terms similar to the 2019/547 instrument (s 7(4) Category 1(b)). Enforcement questions may therefore involve determining whether an individual ASIC instrument was in force and whether the relief it provided matches the textual conditions referenced in the instrument.

The instrument’s repeal date (s 9) also creates an enforcement horizon: after repeal (from 1 April 2031) the substituted text will no longer shape the Act, and enforcement assessments for transactions after repeal will apply whatever regime replaces it. The instrument does not address transitional enforcement arrangements; duties and enforcement for transactions occurring during the instrument’s operative period must be determined against the Act as modified while it is in force.

This instrument operates by amending how specified sections in the Corporations Act 2001 are to be read; its interactions are therefore textual and depend on cross-references to specific Act provisions and to other ASIC instruments.

• Amendments to specified Act provisions: The instrument substitutes new text into subsection 707(3) of the Corporations Act (and by textual instruction treats Chapter 6D as if those subsections were omitted and substituted), and substitutes new text into subsections 1012C(6)-(7) for Part 7.9 (s 7(1)-(2)). It also modifies sections 708A and 1012DA by inserting a new paragraph (13) dealing with stapled securities (s 8(1)-(2)). Therefore the instrument’s primary interactions are with those sections and with the broader bodies of law that they sit within (Chapter 6D for disclosure, Part 7.9 for product disclosure).

• Interaction with sections 708 and 708A: The substituted on-sale wording expressly preserves the operation of sections 708 and 708A by providing that the on-sale conditionality applies “and section 708 or 708A does not say otherwise” (s 7(1)). This means the instrument nests inside the Act’s existing exception framework; any other statutory exemption in 708/708A will prevail where applicable.

• Reference to ASIC instruments: Category 1 expressly references ASIC Corporations (Share and Interest Purchase Plans) Instrument 2019/547 and also allows for reliance on individual ASIC instruments providing similar relief (s 7(4) Category 1(a)-(b)). That means the instrument operates in concert with, and depends upon, ASIC rule-making and individual instrument activity. Where an individual ASIC instrument exists that provides relief similar to 2019/547, the exempt category is available. The instrument therefore relies on, and interacts with, ASIC’s own instrument-making powers.

• Declared financial market concept and previous regulatory definitions: The stapled-securities insertion references a “declared financial market” (s 8). The instrument includes a note referencing section 9D of the Act and section 1705F for the transitional treatment of prescribed financial markets. This ties the stapled-security treatment to the Act’s statutory regime for market declarations and to the historic transitional rule for pre-existing prescribed markets. The interaction will therefore require concurrence between market rules, market operator processes, and the statutory definition of a declared financial market.

• Managed investment schemes and notified foreign passport funds: The instrument narrows the types of products to which the substituted on-sale text applies (s 7(3)). It expressly applies to “offers of securities, interests in a managed investment scheme or interests in a notified foreign passport fund for sale; and recommendations to acquire interests in a managed investment scheme or interests in a notified foreign passport fund by way of transfer.” That places the instrument’s changes in direct interaction with the Act’s provisions that govern offers and recommendations for scheme interests and foreign passport funds.

• Repeal of prior ASIC instrument: The Schedule 1 repeal removes ASIC Corporations (Sale Offers That Do Not Need Disclosure) Instrument 2016/80 in full (Schedule 1, item 1). The 2026 instrument therefore replaces or supersedes the earlier instrument’s effect for the period it is in force. Any rights, relief or interpretation that relied on the old instrument will need to be re-examined against the text of the 2026 instrument.

• Temporal interaction with Act amendments: The instrument commences on the later of registration and 1 April 2026 (s 2) and is repealed at the start of 1 April 2031 (s 9). It therefore interacts with whatever legislative or regulatory framework exists before commencement and after repeal. It does not itself specify transitional arrangements beyond its commencement and repeal dates.

In practical terms, the instrument is a textual modifier of the Act rather than a standalone new statute; understanding its operation requires reading it into the Act’s relevant sections and considering how those sections operate with other statutory exemptions, ASIC instruments, market rules and the declared financial market framework.

The instrument contains its own short amendment and repeal history within its text; it both repeals an earlier ASIC instrument and is drafted to operate for a defined period.

• Repeal of prior ASIC instrument: Schedule 1 repeals ASIC Corporations (Sale Offers That Do Not Need Disclosure) Instrument 2016/80 in its entirety (Schedule 1, item 1). The effect is to remove the earlier instrument from the statute book when this instrument commences and has effect according to its own commencement rule (s 2). The new instrument therefore functions as the governing ASIC instrument on sale-offer disclosure relief for its operative period, replacing the framework previously contained in the 2016/80 instrument.

• Commencement and operative period: The instrument commences on the later of the day after it is registered on the Federal Register of Legislation and 1 April 2026 (s 2). The instrument is expressly repealed at the start of 1 April 2031 (s 9). Consequently, its statutory effect is time-limited to the window between commencement and repeal. The instrument therefore creates a five-year definitive window for the modified on-sale and stapling rules, unless earlier repealed or later extended by further legislative action.

• Authority for amendment-making: The instrument is made under subsections 741(1) and 1020F(1) of the Corporations Act (s 3). Those sub-sections provide the statutory power by which ASIC may make legislative instruments altering application of specified parts of the Act. The instrument itself records that authority; it does not summarize or reproduce the content of those subsections.

• Internal structure and textual substitutions: The instrument operates by instructing that Chapter 6D and Part 7.9 “apply to all persons as if” specified subsections were omitted and substituted (s 7(1)-(2)), and as if sections 708A and 1012DA were modified by inserting paragraph (13) (s 8). These are not standalone amendments but textual substitutions instructing how the Act should be read for the relevant periods.

• No intermediate amending history recorded within instrument: The instrument does not record prior amendments to itself (it is a new instrument replacing a previous instrument via Schedule 1) and contains no schedules amending other instruments apart from the repeal of 2016/80. The instrument’s scheduled repeal in 2031 constitutes an embedded sunset clause and is the only forward-looking amendment-history element in the text.

Those are the factual amendment-history elements recorded in the instrument: repeal of the 2016/80 instrument, commencement timing, five-year operative window, and the statutory authority under the Corporations Act.

The instrument text contains no references to litigation, court decisions, or submissions in ongoing proceedings. It does not cite or endorse any cases. There is therefore no litigation history recorded within this instrument itself.

Practical implications of that absence:

• No precedent within the instrument: Because the instrument does not reference judicial decisions, there is no internal guidance as to how courts have interpreted similar text. Interpretation questions raised by the instrument , for example, what precisely constitutes the issuer’s or recipient’s “purpose” that securities were issued to enable a sale or transfer, or how to adjudicate whether an issue is “covered by an exempt category” , will need to be resolved through application of statutory interpretation principles to the text and through future case law, if litigation arises.

• Potential for future litigation on factual constructs: The instrument introduces factual elements (for example the “purpose” test and the categorical rules in s 7(4)) that invite fact-sensitive disputes. Litigation, if it occurs, is likely to focus on factual matters (e.g. contemporaneous documentation of purpose, the applicability of an ASIC individual instrument, the characterisation of conversions/exercises under Category 2, or market practice for stapled securities). The instrument itself does not indicate preferred evidentiary approaches or thresholds.

• Market practice and administrative determinations: Absent judicial guidance in the instrument, parties will look to ASIC’s administrative practice and to market operators’ implementation to reduce litigation risk. The instrument references ASIC-made instruments (for example Category 1’s reliance on ASIC 2019/547 or individual instruments), so ASIC’s own administrative records and rulings about the use of those instruments will likely shape dispute resolution pathways outside of formal litigation.

• No transitional or declaratory litigation references: The instrument does not provide transitional arrangements or declaratory guidance about past transactions. Whether existing deals that were structured under the old instrument (2016/80) will be treated consistently under the new instrument is a factual and legal question that could give rise to disputes; the instrument does not itself resolve such questions.

Because the instrument contains no litigation history, practitioners must assume that the text is untested and that disputes will require courts or tribunals to provide interpretive guidance on the factual elements and statutory interactions the instrument introduces.

The instrument introduces several textual and practical issues that advisers, issuers, market operators and investors should watch closely. These are mechanical and contextual risks emerging from the instrument’s wording.

• The “purpose” element is fact-based and may be difficult to prove: The substituted on-sale wording conditions the need for disclosure on whether the securities “were issued with the purpose of the person to whom they were issued” selling, transferring, or granting interests/options over them (s 7(1)(b), s 7(2)(c)). “Purpose” is not defined in the instrument. In practice that means contemporaneous documents like offer terms, subscription agreements, placement letters, board minutes, internal emails and communications will be vital. Parties who do not contemporaneously record and preserve evidence of purpose risk later disputes about whether the on-sale disclosure duty applied.

• Category definitions rely on other instruments and Act subsections: Category 1 depends on ASIC Corporations (Share and Interest Purchase Plans) Instrument 2019/547 or similar individual ASIC instruments (s 7(4) Category 1). Category 2 depends on the original options or convertible securities having been issued under a disclosure document or PDS and on exercise/conversion not involving a further offer (s 7(4) Category 2(a)-(c)). Categories 3-7 each reference particular subsections (708(13), 708(17), 708(17A), 708(18), 708(21) and 1012D(3), 1012D(7) as applicable). The gotcha is that reliance on a category requires precise matching to the textual conditions; minor differences in the structure of an issue or in the terms of an ASIC instrument may mean a security is not “covered by an exempt category.”

• Narrow product scope: The substituted on-sale text applies only to “offers of securities, interests in a managed investment scheme or interests in a notified foreign passport fund for sale; and recommendations to acquire interests in a managed investment scheme or interests in a notified foreign passport fund by way of transfer” (s 7(3)). Offers or products that fall outside these categories (for example other forms of unlisted financial products not captured by the instrument’s text) are not covered. Practitioners must check product taxonomy carefully.

• Interaction with sections 708 and 708A may create surprises: The substituted text explicitly leaves room for sections 708 and 708A to “say otherwise” (s 7(1)). That means a party cannot assume the substituted on-sale limitation will always shield them from disclosure needs. They must check whether a particular statutory exemption in 708 or 708A still applies or conversely disapplies the substitution’s effect.

• Stapled securities classification and suspension effects: The new stapled securities paragraph treats a component security as being in a distinct quoted class when it is only transferable as part of a stapled product, and treats its trading as suspended when the stapled class is suspended (s 8(1)-(2)). Market operators and issuers should anticipate operational consequences: trading halts of stapled securities will now statutorily carry suspension effects across component classes, and class-of-quoted-securities records must reflect stapled vs non-stapled states. If market infrastructure or documentation does not align with the new classification approach, errors in suspension or trading status could occur.

• Temporal boundary and expiry risk: The instrument is repealed at the start of 1 April 2031 (s 9). Transactions taking place near that date may be exposed to uncertainty about transitional treatment post-repeal. Parties relying on the instrument’s relief should consider exit planning and whether extensions or alternative compliance approaches are necessary.

• Reliance on ASIC individual instruments: Category 1 allows coverage via an “individual instrument made by ASIC” that provided similar relief (s 7(4) Category 1(b)). That requires care: the phrase “in terms similar to that legislative instrument” introduces interpretive uncertainty. Practitioners must verify the exact terms of any individual ASIC instrument to ensure it provides the relief needed for the category to apply.

• No express evidentiary standard for “covered by an exempt category”: The instrument does not supply a mechanics clause stating how a party is to establish that securities are “covered by an exempt category.” That omission leaves proof questions open and increases the importance of record-keeping and documentary evidence.

• Potential gap for hybrid or novel instruments: The categories are specific and tied to existing Act subsections and ASIC instruments. Novel hybrid products or structures that do not fit neatly into Category 1-7 could fall outside the instrument’s relief while still resembling covered products. Issuers of novel instruments must not assume the relief applies without careful textual matching.

These “gotchas” are factual and legal frictions created by the instrument’s reliance on purpose, categorical matching, cross-references to other instruments and a market-operational stapling rule. They create compliance and evidentiary costs that parties must manage through documentation, market process alignment and legal advice.

To rely on the relief, issuers, regulated persons, trustees and market operators should adopt concrete compliance steps that reflect the instrument’s textual requirements. The following practical checklist aligns to the instrument’s primary provisions (s 2-9 and Schedule 1) and the categories in s 7(4).

1. Determine whether the instrument applies to the product and offer type

   • Confirm the product is an offer of securities, interests in a managed investment scheme, or interests in a notified foreign passport fund, or a recommendation to acquire such interests by transfer (s 7(3)). If not, do not rely on the instrument for on-sale relief.

2. Check the timing of the on-sale

   • Confirm any subsequent offer for sale is within 12 months of issue (s 7(1) and s 7(2)(a)). The instrument’s relief only concerns offers within that 12-month window.

3. Identify the applicable exempt category and document conformity

   • For Category 1 (share/interest purchase plans): confirm the initial issue was covered by ASIC Corporations (Share and Interest Purchase Plans) Instrument 2019/547 or by an individual ASIC instrument providing similar relief (s 7(4) Category 1(a)-(b)). Keep a copy of the ASIC instrument relied upon and document the mechanics tying the issue to that instrument.
   • For Category 2 (options/convertible securities): document that the securites were issued by reason of exercise or conversion, that the original options or convertible securities were issued under a disclosure document or with a PDS, and that exercise/conversion did not involve any further offer (s 7(4) Category 2(a)-(c).
   • For Category 3: rely on the textual hooks to subsections 708(13) or 1012D(3); document dividend/distribution reinvestment or bonus plan terms demonstrating the statutory connection (s 7(4) Category 3).
   • For Categories 4-7: ensure the circumstances match the referenced Act subsections (708(17), 708(17A), 708(18)/1012D(7), 708(21)) and preserve records showing the issue fits the legislative description (s 7(4) Categories 4-7).

4. Evidence and contemporaneous documentation of “purpose”

   • Because the substituted on-sale provision turns on whether the securities were issued “with the purpose” that the recipient would sell or transfer (s 7(1)(b), s 7(2)(c)), contemporaneously record the issuer’s intent. Use subscription agreements, placement letters, board resolutions, offering memoranda, emails and client-facing communications to create a documentary trail that supports whatever position you will assert concerning purpose. Where the issuer wishes to rely on the absence of such a purpose, document evidence to support that as well.

5. For regulated persons and PDS considerations

   • Regulated persons must apply the substituted test in s 7(2): verify that (a) the offer is within 12 months, (b) the product was issued without a PDS, and (c) the issuer issued the product with the purpose that the recipient would sell/transfer or grant interests/options/warrants (s 7(2)(a)-(c)). If the conditions are met and the product is within an exempt category, adjust PDS preparation and distribution practices accordingly.

6. Stapled securities: update market classifications and suspension procedures

   • If a security or product is only transferable as part of a stapled security on a declared financial market, put in place procedures to treat the component as a distinct quoted class when it is in that stapled state and to treat its trading as suspended when trading in the stapled class is suspended (s 8(1)-(2)). Coordinate with the market operator to ensure class-of-quoted-securities records, market notices and suspension mechanisms reflect the statutory approach.

7. Retain evidence of reliance on ASIC individual instruments

   • If relying on an ASIC individual instrument to qualify for Category 1 or other relief (s 7(4) Category 1(b)), retain the text of that instrument and proof that it was in force at the relevant time. Document the correspondence with ASIC and ensure the individual instrument’s terms match the textual conditions in the instrument.

8. Monitor the instrument’s operative period and plan for expiry

   • Note the commencement (later of registration and 1 April 2026, s 2) and the repeal at the start of 1 April 2031 (s 9). For multi-year transactions or structures that fall across the repeal date, plan for the instrument’s expiry and any necessary transitional steps (for example, consider whether disclosure obligations will re-emerge after repeal and whether fresh PDSs or prospectuses will be required).

9. Review and align internal compliance policies

   • Update issuer and adviser compliance manuals, client engagement letters and transaction checklists to incorporate the instrument’s categories, the purpose test, and the stapled-securities rules. Train deal teams and compliance officers on documenting purpose, qualifying categories, and market suspension implications.

10. Seek legal advice on borderline cases

    • For newer or hybrid instruments, or where the facts are ambiguous (for example, where an ASIC individual instrument’s terms are not clearly similar to the 2019/547 instrument), obtain legal advice and consider obtaining ASIC relief or a class order if necessary.

Following these steps will not eliminate all uncertainty, but it aligns transactional processes with the instrument’s textual requirements and produces the documentary evidence required to justify reliance on the instrument’s relief.