ASIC extends class order relief for litigation funding schemes
The Australian Securities and Investments Commission (ASIC) has announced it will extend the interim class order relief granted to lawyers and funders involved in legal proceeding structures as funded representative proceedings.
The regulator stated that it will also extend relief on funding claims lodged with liquidators to improve the winding up of an insolvent company.
The relief will extend until 30 September 2012 and will allow a litigation funding scheme and a proof of debt funding scheme that is defined as a managed investment scheme to temporarily operate without having to comply with the requirements of the Corporations Act 2001.
These requirements include holding an Australian financial services licence covering the provision of financial services in relation to the arrangement, preparing a product disclosure statement and providing ongoing disclosure.
The relief arrangement has been allowed in order for the Federal Government to implement legislative reform it previously announced and avoid any disruption that could adversely impact plaintiffs and the efficient running of litigation, the regulator stated.
ASIC added that following any legislative change in this area, it will consider issuing further guidance about these schemes after public consultation.
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