Treasury instructs ASIC not to answer questions on litigation funding
The Australian Securities and Investments Commission (ASIC) has refused to reveal to a Parliamentary Committee key documentation between it and the Treasurer’s office around the Government’s decision to make class action litigation fund subject to an Australian Financial Services License (AFSL).
ASIC refused the request from a Labor member of the Parliamentary Joint Committee on Corporations and Financial Services saying it had been told not to reveal any of the relevant communications by the Treasury.
Labor Senator Deborah O’Neill had asked ASIC to provide the correspondence amid concerns that the Government, under pressure from lobbyists, had given the regulator barely 24 hours’ notice of its intention to impose AFSL conditions on class action litigation funding in similar terms to a Licensed Investment Scheme (LIS).
“For the purposes of this question, ASIC has assumed that ‘correspondence’ means written communications, including letters and emails, up to and including 22 May 2020, the date of the announcement of the Government’s decision to regulate litigation funding,” the ASIC answer said.
“There were four pieces of email correspondence between ASIC and the Treasury about the proposal.
“However, Treasury has advised ASIC that such correspondence should not be produced to the Committee because:
a) such correspondence is subject to legal privilege;
b) such correspondence is Cabinet-in-confidence; and/or
c) the release of such correspondence would be contrary to the public interest.
“In light of this advice, ASIC has not produced this correspondence. Questions about correspondence between ASIC and Treasury about the Government’s policy decisions in relation to the regulation of litigation funding should be directed to the Treasury.”
ASIC chairman, James Shipton had earlier confirmed to the committee the almost unprecedented short notice the regulator had received of the Government’s decisions.
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