Document ID: chunk:federal_register_of_legislation:C2005C00498:clause:1_1020c
Version: federal_register_of_legislation:C2005C00498
Segment Type: clause
Provision Reference: sch 1 cl 1020C
Character Range: 645801–647800

1020C  ASIC's power to prohibit short selling in certain cases

 (1) If ASIC forms the opinion that it is necessary to prohibit section 1020B products (as defined in subsection 1020B(1)), or a particular class of section 1020B products, from being sold on a licensed market in a manner that, but for paragraph 1020B(4)(e), would contravene subsection 1020B(2), in order to:
 (a) protect persons who might suffer financial loss if they were to buy or sell those products in that manner; or
 (b) protect the public interest;
ASIC may give written notice (the preliminary notice) to the operator of the market stating that it has formed that opinion and setting out the reasons for that opinion.

 (2) If, after receiving the preliminary notice:
 (a) the operator does not take action to prevent the selling on the market of the products, or class of products, specified in the preliminary notice in the manner referred to in subsection (1); and
 (b) ASIC is still of the opinion that it is necessary to prohibit the selling on that market of the products, or class of products, in that manner;
ASIC may, by a further written notice (the prohibition notice) given to the operator, prohibit the selling on the market of the products, or class of products, in that manner during a period of not more than 21 days.

 (3) As soon as practicable after giving the prohibition notice to the operator, ASIC must give to the Minister a written report setting out the reasons for the giving of the prohibition notice and send a copy of the report to the operator.

 (4) On receiving the report, the Minister may direct ASIC to revoke the prohibition notice and, if such a direction is given, ASIC must immediately revoke the prohibition notice.

 (5) While the prohibition notice is in force, the operator must not permit the selling of section 1020B products on the market in a way that contravenes the prohibition notice.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).