Australian regulator ASIC announced earlier today that it is seeking feedback on proposals to grant relief for voluntary escrow arrangements and pre-prospectus communications in connection with an initial public offer (IPO).
Currently companies that are considering undertaking an IPO must apply to ASIC for individual relief and pay application fees. The watchdog is about to reduce and simplify the regulatory costs for firms undertaking an IPO while maintaining investor protection and market integrity.
ASIC Commissioner John Price commented:
It is important that voluntary escrow arrangements and pre-prospectus communications continue to be appropriately regulated so that our market remains orderly and transparent. The proposals strike a balance between reducing red-tape for an IPO and managing the risks that might otherwise occur in the absence of regulation.
ASIC regularly grants conditional relief for voluntary escrow arrangements in connection with an IPO on a case-by-case basis. The regulator also grants relief to applicants on a case-by-case basis to allow certain types of pre-prospectus communications about an IPO.
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