ASIC Corporations (Conditional Costs Schemes) Instrument 2020/38
I, Grant Moodie, delegate of the Australian Securities and Investments Commission, make the following legislative instrument.
Grant Moodie
ASIC Corporations (Conditional Costs Schemes) Instrument 2020/38
I, Grant Moodie, delegate of the Australian Securities and Investments Commission, make the following legislative instrument.
Grant Moodie
Contents
1 Name of legislative instrument
5 Definition of managed investment scheme
8 Financial product disclosure
1 Name of legislative instrument
This is the ASIC Corporations (Conditional Costs Schemes) Instrument 2020/38.
This instrument commences on the day after it is registered on the Federal Register of Legislation.
Note: The register may be accessed at www.legislation.gov.au.
This instrument is made under subsections 601QA(1), 926A(2), 992B(1) and 1020F(1) of the Corporations Act 2001.
In this instrument:
Act means the Corporations Act 2001.
conditional costs agreement means an agreement of the kind defined as a conditional costs agreement in section 181 of Schedule 1 (Legal Profession Uniform Law) to the Legal Profession Uniform Law Application Act 2014 of the State of Victoria as in force on 17 January 2020 whether or not in that State or for the purposes of that Act.
5 Definition of managed investment scheme
Chapter 5C of the Act applies to all persons as if section 9 of the Act were modified or varied as follows:
(a) after the definition of condition, insert:
“conditional costs agreement means an agreement of the kind defined as a conditional costs agreement in section 181 of Schedule 1 (Legal Profession Uniform Law) to the Legal Profession Uniform Law Application Act 2014 of the State of Victoria as at 17 January 2020 whether or not in that State or for the purposes of that Act.”;
(b) in the definition of managed investment scheme, after paragraph (ma) insert:
“(maa) a scheme for participating in and conducting legal proceedings where the members of the scheme:
(i) have or may have an entitlement to a remedy arising out of the same or similar circumstances; and
(ii) wholly or substantially fund their legal costs under conditional costs agreements;
(mab) a scheme for proving claims against a company under Division 6 of Part 5.6 (including the preparation and lodgement of the proofs) where the members of the scheme:
(i) have or may have claims against the company arising out of the same or similar circumstances; and
(ii) wholly or substantially fund their legal costs under conditional costs agreements;”.
A person does not have to comply with subsection 911A(1) or 911B(1) of the Act for the provision of a financial service in relation to:
(a) an interest in a managed investment scheme (a conditional cost litigation scheme) that is a scheme for participating in and conducting legal proceedings, where the members of the scheme:
(i) have or may have an entitlement to a remedy arising out of the same or similar circumstances; and
(ii) wholly or substantially fund their legal costs under conditional costs agreements; or
(b) an interest in a managed investment scheme (a conditional cost proof of debt scheme) that is a scheme for proving claims against a company under Division 6 of Part 5.6 of the Act (including the preparation and lodgement of the proofs) where the members of the scheme:
(i) have or may have claims against the company arising out of the same or similar circumstances; and
(ii) wholly or substantially fund their legal costs under conditional costs agreements; or
(c) an arrangement (a funding product), or an interest (a funding product) in an arrangement of either of the following kind, to the extent that the arrangement or interest is a financial product other than an interest in a conditional cost litigation scheme or conditional cost proof of debt scheme:
(i) an arrangement for participating in and conducting legal proceedings brought by or on behalf of a person where the person’s legal costs are wholly or substantially funded under a conditional cost agreement;
(ii) an arrangement for proving claims made by a person against a company under Division 6 of Part 5.6 of the Act (including the preparation and lodgement of the proofs) where the person’s legal costs are wholly or substantially funded under a conditional cost agreement.
A person does not have to comply with subsection 992A(1) or (3), or subsection 992AA(1), of the Act in relation to:
(a) an interest in a conditional cost litigation scheme; or
(b) an interest in a conditional cost proof of debt scheme; or
(c) a funding product.
8 Financial product disclosure
A person does not have to comply with Part 7.9 of the Act in relation to:
(a) an interest in a conditional cost litigation scheme; or
(b) an interest in a conditional cost proof of debt scheme; or
(c) a funding product.
Part 4—Application and transitional
For the avoidance of doubt, the declaration in section 5 does not have effect for the purposes of section 601MB of the Act in relation to a contract entered into before the commencement of this instrument by a person to subscribe for an interest in:
(a) a conditional cost litigation scheme; or
(b) a conditional cost proof of debt scheme.
This instrument has effect until 31 January 2023.