Reporting misconduct to ASX FAQs

Matters to do with how brokers perform their services, including the quality of their advice, are regulated by the Australian Securities and Investments Commission (ASIC) under the Corporations Act and the ASIC Market Integrity Rules, rather than by ASX.

Brokers are required by law to have a two-step complaint handling process. The first step is an internal complaints handling procedure and, if that does not lead to an acceptable resolution, the second step is the right to have your complaint adjudicated by an external independent complaint handling service.

If you are not happy with something your broker has done, in the first instance, you should ask for details from your broker on how to make a complaint under the broker's complaint handling process.

Once you have gone through the complaints handling process, if you are still not satisfied with the outcome, you should direct your concern or complaint to ASIC via its complaint portal.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

Matters to do with how brokers perform their services, including whether they have acted in accordance with their client's instructions, are regulated by the Australian Securities and Investments Commission (ASIC) under the Corporations Act and the ASIC Market Integrity Rules, rather than by ASX.

Brokers are required by law to have a two-step complaint handling process. The first step is an internal complaints handling procedure and, if that does not lead to an acceptable resolution, the second step is the right to have your complaint adjudicated by an external independent complaint handling service.

If you are not happy with something your broker has done, in the first instance, you should ask for details from your broker on how to make a complaint under the broker's complaint handling process.

Once you have gone through the complaints handling process, if you are still not satisfied with the outcome, you should direct your concern or complaint to ASIC via its complaint portal.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

Matters to do with how brokers perform their services, including how they handle conflicts of interests, are regulated by the Australian Securities and Investments Commission (ASIC) under the Corporations Act and the ASIC Market Integrity Rules, rather than by ASX.

Brokers are required by law to have a two-step complaint handling process. The first step is an internal complaints handling procedure and, if that does not lead to an acceptable resolution, the second step is the right to have your complaint adjudicated by an external independent complaint handling service.

If you are not happy with something your broker has done, in the first instance, you should ask for details from your broker on how to make a complaint under the broker's complaint handling process.

Once you have gone through the complaints handling process, if you are still not satisfied with the outcome, you should direct your concern or complaint to ASIC via its complaint portal.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

Matters to do with how brokers perform their services, including how they handle the competing interests of their clients, are regulated by the Australian Securities and Investments Commission (ASIC) under the Corporations Act and the ASIC Market Integrity Rules, rather than by ASX.

Brokers are required by law to have a two-step complaint handling process. The first step is an internal complaints handling procedure and, if that does not lead to an acceptable resolution, the second step is the right to have your complaint adjudicated by an external independent complaint handling service.

If you are not happy with something your broker has done, in the first instance, you should ask for details from your broker on how to make a complaint under the broker's complaint handling process.

Once you have gone through the complaints handling process, if you are still not satisfied with the outcome, you should direct your concern or complaint to ASIC via its complaint portal.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

Matters to do with how brokers perform their services, including if they are front running client orders, are regulated by the Australian Securities and Investments Commission (ASIC) under the Corporations Act and the ASIC Market Integrity Rules, rather than by ASX.

Brokers are required by law to have a two-step complaint handling process. The first step is an internal complaints handling procedure and, if that does not lead to an acceptable resolution, the second step is the right to have your complaint adjudicated by an external independent complaint handling service.

If you are not happy with something your broker has done, in the first instance, you should ask for details from your broker on how to make a complaint under the broker's complaint handling process.

Once you have gone through the complaints handling process, if you are still not satisfied with the outcome, you should direct your concern or complaint to ASIC via its complaint portal.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

ASX does not impose a minimum order size or value. Securities can be bought or sold on ASX in any number or for any value.

However, the ASX Settlement Operating Rules prohibit brokers from initiating a transfer of securities in CHESS if the transfer will result in the registration of a holding that is less than a “marketable parcel”. In general, a marketable parcel is a parcel of securities whose value is $500 or more.

The marketable parcel requirement exists so that listed entities do not have large numbers of very small holdings, to help them avoid unreasonable costs in running their register and communicating with their security holders.

Mindful of this requirement, many brokers impose a rule that their clients can only place an order to buy or sell at least $500 worth of shares. These types of restrictions are imposed at the discretion of the broker and are not prescribed by ASX.

If you feel you have been disadvantaged by any minimum order size or value that a broker has imposed, you should discuss that with your broker and see what options may be available to you.

ASX can only take action against a listed company if it is doing or failing to do something that breaches ASX's Listing Rules.

If a listed company is established in Australia (as most ASX listed companies are), issues to do with whether its directors are complying with their statutory duties under the Corporations Act are regulated by the Australian Securities and Investments Commission (ASIC), rather than by ASX. Any concerns or complaints about a suspected breach of duties by the directors of the listed company should be directed to ASIC via its complaint portal.

If a listed company is established elsewhere, issues to do with whether its directors are complying with their statutory duties will be regulated by the ASIC-equivalent regulator in the place where it is established. Any concerns or complaints about a suspected breach of duties by the directors of the listed company should be directed to that regulator.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

ASX can only take action against a listed company if it is doing or failing to do something that breaches ASX's Listing Rules.

There are provisions in the Listing Rules that prevent a major shareholder from acquiring a substantial asset from, or disposing of a substantial asset to, or taking up an issue of shares by, a listed company without shareholder approval. The major shareholder and its associates are not allowed to vote on the resolution approving the transaction. If that type of conduct is occurring, ASX can and will take action to enforce the Listing Rule requirements for shareholder approval.

The directors of a listed company generally are subject to a statutory duty to act in the best interests of the company and not to favour the interests of one particular shareholder over others. However, that statutory requirement is not one that ASX can enforce.

If a listed company is established in Australia (as most ASX listed companies are), issues to do whether its directors are complying with their statutory duties under the Corporations Act are regulated by the Australian Securities and Investments Commission (ASIC), rather than by ASX. Any concerns or complaints about a suspected breach of duties by the directors of the listed company should be directed to ASIC via its complaint portal.

If a listed company is established elsewhere, issues to do with whether its directors are complying with their statutory duties will be regulated by the ASIC-equivalent regulator in the place where it is established. Any concerns or complaints about a suspected breach of duties by the directors of the listed company should be directed to that regulator.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

The ASX Corporate Governance Council (CGC) publishes recommended corporate governance practices for ASX listed entities. These recommendations are not binding but rather operate on an “if not, why not” basis. Each ASX listed entity is required to report, at the time of its listing and thereafter on an annual basis, whether or not it follows the CGC's recommendations. If it does not, it must explain why not and what alternative governance practices it has adopted instead.

One of the CGC's recommendations is that a majority of the board of a listed company should be independent. However, that recommendation is not binding and a listed company may choose not to have a majority of independent directors, provided it explains in its annual corporate governance statement why it has done so.

Shareholders of a listed company get to vote on an election of directors each year. Directors have to stand for re-election after being in office for 3 years or at their third AGM (whichever is the longer). Shareholders as a group, therefore, get the ultimate say on who should be on the board and whether a majority of directors should be independent.

The ASX Corporate Governance Council (CGC) publishes recommended corporate governance practices for ASX listed entities. These recommendations are not binding but rather operate on an “if not, why not” basis. Each ASX listed entity is required to report, at the time of its listing and thereafter on an annual basis, whether or not it follows the CGC's recommendations. If it does not, it must explain why not and what alternative governance practices it has adopted instead.

One of the CGC's recommendations is that the Chairman of the board of a listed company should be an independent director and, in particular, should not be the same person as the CEO of the company. However, that recommendation is not binding and a listed company may choose to have the same person in the role of Chairman and CEO, provided it explains in its annual corporate governance statement why it has done so.

ASX can only take action against a listed company if it is doing or failing to do something that breaches ASX's Listing Rules.

There are provisions in the Listing Rules that prevent a listed company from issuing shares to a director or an associate of a director in certain circumstances without shareholder approval. This includes issues under an employee incentive plan or otherwise as part of the director's remuneration. The director and their associates are not allowed to vote on the resolution approving the issue.

If:

• the CEO or other executive you are concerned about is a director;
• part of their remuneration comes in the form of an issue of shares, whether under an employee incentive plan or otherwise; and
• the requisite shareholder approval has not been obtained,

then ASX can and will take action to enforce the Listing Rule requirements for shareholder approval.

Beyond that, how much the CEO and other executives of a listed company get paid is a matter for the board of directors of the company.

If the listed company is incorporated in Australia (as many are), its shareholders will get the opportunity to have their say on the level of executive remuneration by voting on its remuneration report at its AGM. There are “two-strike” provisions in the Corporations Act that require the directors to stand for re-election if the remuneration report is voted down by shareholders at two consecutive AGMs. These “two-strike” provisions are regulated by ASIC rather than ASX.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

Chapter 7 of the ASX Listing Rules establishes the framework for listed companies to conduct placements, rights issues, share purchase plans, dividend reinvestment plans and the like.

As far as placements are concerned, in broad terms, the directors of a listed company are allowed under Listing Rule 7.1 to issue up to 15% of the company's issued capital every 12 months at whatever price they consider appropriate. If the entity is outside the ASX300 and has a market capitalisation of less than $300m, it can also obtain shareholder approval under Listing Rule 7.1A to increase this by an extra 10% of the entity's issued capital (although any issues under this extra placement capacity must be at a price which is not less than 75% of the volume-weighted average price near the time of the placement).

These rules reflect the general principle that matters to do with the management of a listed company are matters for the board rather than shareholders. It is only if the directors seek to place more shares than they are permitted to issue under their placement capacity in Listing Rules 7.1 and 7.1A that they need to seek shareholder approval.

The ASX Listing Rules impose continuous disclosure obligations on listed entities. Specifically, under Listing Rule 3.1, when a listed entity is or becomes aware of any information that a reasonable person would expect to have a material impact on the price or value of its securities (usually referred to as “market-sensitive information”), it has an obligation to immediately inform the market of that information, unless it falls within certain prescribed exceptions set out in Listing Rule 3.1A.

A listed entity is not required to disclose information about a breach of law under Listing Rule 3.1 if the information is not market-sensitive (ie it would not have a material impact on the price or value of its securities). Many minor breaches of law would fall within this category.

Under Listing Rule 3.1A, a listed entity may also not be required to disclose information about a breach of law if the information is a matter of supposition or insufficiently definite to warrant disclosure.

The ASX Listing Rules impose continuous disclosure obligations on listed entities. Specifically, under Listing Rule 3.1, when a listed entity is or becomes aware of any information that a reasonable person would expect to have a material impact on the price or value of its securities (usually referred to as “market-sensitive information”), it has an obligation to immediately inform the market of that information, unless it falls within certain prescribed exceptions set out in Listing Rule 3.1A.

A listed entity is not required to disclose information about a dispute under Listing Rule 3.1 if the information is not market-sensitive (ie it would not have a material impact on the price or value of its securities). Many disputes with employees, suppliers, or customers are run of the mill and would fall within this category.

Under Listing Rule 3.1A, a listed entity may also not be required to disclose information about a dispute if the information is a matter of supposition or insufficiently definite to warrant disclosure.

ASX can only take action against a listed trust if it is doing or failing to do something that breaches ASX's Listing Rules.

If the listed trust is a managed investment scheme established in Australia (as almost all ASX listed trusts are), issues to do with whether its responsible entity is complying with its statutory duties under the Corporations Act are regulated by Australian Securities and Investments Commission (ASIC) under the Corporations Act, rather than by ASX. Any concerns or complaints about a suspected breach of duties by the responsible entity of the listed trust should be directed to ASIC via its complaint portal.

If the listed trust is established elsewhere, issues to do with whether its responsible entity is complying with its statutory duties to unitholders will be regulated by the ASIC-equivalent regulator in the place where it is established. Any concerns or complaints about a suspected breach of duties by the responsible entity of the listed trust should be directed to that regulator.

More information about the types of matters that are regulated by ASIC under the Corporations Act and the ASIC Market Integrity Rules, and those that are regulated by ASX under ASX's Operating Rules, is available here.

The ASX Listing Rules impose continuous disclosure obligations on listed entities. Specifically, under Listing Rule 3.1, when a listed entity is or becomes aware of any information that a reasonable person would expect to have a material impact on the price or value of its securities (usually referred to as “market sensitive information”), it has an obligation to immediately inform the market of that information, unless it falls within certain prescribed exceptions set out in Listing Rule 3.1A.

ASX monitors market activity in the securities of listed entities for the purpose of detecting instances of abnormal trading that could indicate there has been a leak of market sensitive information yet to be announced under Listing Rule 3.1.

If ASX identifies any abnormal trading in a listed entity's securities which raises a potential continuous disclosure issue, it will generally contact the entity to discuss the situation. In that conversation, ASX will usually ask the entity if it is aware of any information concerning the entity which has not been announced to the market and which, if known, could explain the abnormal trading in its securities. Typically, these discussions will have one of two conclusions – the entity will tell ASX that:

• it is not aware of any such information – in which case, depending on the circumstances, ASX may issue a price query letter asking the entity to confirm that fact in writing; or
• it is aware of such information – in which case, this will generally lead to a discussion about whether the information needs to be announced under Listing Rule 3.1.

Not all situations where security prices move significantly over a short period will result in ASX issuing a price query letter. Examples of where ASX will not issue a price query letter include:

• where ASX does not consider the price movement to be abnormal;
• where ASX considers that the price movement can be readily explained by information already known by the market (eg because it has been included in a previous announcement by the entity or is widely known); or
• where the entity has released, either of its own volition or after discussions with ASX, an announcement that explains the likely cause of the movement.

It is not uncommon for a listed entity's securities to experience a prolonged downturn. Sometimes this can be caused by market-wide factors (such as depressed economic conditions or a downturn in sentiment affecting all listed entities), sector-wide factors (such as a deterioration in commodity prices affecting mining or oil & gas entities) or entity-specific factors (such as a loss of confidence in the entity's management).

ASX can only take action against a listed entity if it is doing or failing to do something that breaches ASX's Listing Rules. The fact that the price of its securities has trended down over a prolonged period, of itself, is not a breach of the Listing Rules.

ASX does not issue a price query letter to a listed entity just because the price of its securities has trended down over a prolonged period. ASX only issues a price query letter when it identifies abnormal trading in a listed entity's securities which raises a potential continuous disclosure issue.

The ASX Listing Rules impose continuous disclosure obligations on listed entities. Specifically, under Listing Rule 3.1, when a listed entity is or becomes aware of any information that a reasonable person would expect to have a material impact on the price or value of its securities (usually referred to as “market-sensitive information”), it has an obligation to immediately inform the market of that information, unless it falls within certain prescribed exceptions set out in Listing Rule 3.1A.

Not all news reports are accurate and even an accurate news report may not be disclosable if it is not market-sensitive (ie it would not have a material impact on the price or value of the entity's securities). This may explain why the entity's securities are trading despite no announcement being made.

Registries are appointed by listed entities to run their register of security holders. They are not appointed by or answerable to ASX (although to the extent they participate in the CHESS settlement system, they do have to comply with the ASX Settlement Operating Rules).

ASX can't help you with any queries involving tax file numbers (TFNs) or tax withholding.

If you have an issue involving your TFN or tax withholding, in the first instance you should raise that with the registry itself and try to reach a resolution. If that is not successful, you should raise the issue with the listed entity involved and see if they can help, since the registry is answerable to the listed entity for the running of its register.

Registries are appointed by listed entities to run their register of security holders. They are not appointed by or answerable to ASX (although to the extent they participate in the CHESS settlement system, they do have to comply with the ASX Settlement Operating Rules).

ASX can't help you with any queries involving dividends or distributions.

If you are haven't received a dividend or distribution statement from a registry, you can usually download a copy from their website. If you're not sure how to do this, you should contact the registry for assistance.

Short selling is regulated in Australia under the Corporations Act. Under that Act, clients are required to report short sales to their broker, and the broker is then obliged to report this information, as well as any information about any short sales the broker may execute on its own account, on a gross basis to ASX. ASX publishes the aggregated gross short sale information on ASX Online. 

Separately, persons with a short position in a particular security above a certain threshold are required to report their net short positions to ASIC. ASIC publishes the aggregated net short position information here.

The difference between the two reporting requirements is that the data reported to ASX is on a gross basis and the data reported to ASIC is on a net basis.

More information on Australia's short-selling regime can be found in ASIC Regulatory Guide 196.

ASX charges people to have access to real-time information about market prices.

If you want access to real-time information about market prices, your broker can usually provide it to you.

No. Credit cards and insurance are regulated by the Australian Securities and Investments Commission (ASIC). Any concerns or complaints related to credit cards or insurance should be directed to ASIC via its complaint portal.