In brief — List­ed com­pa­nies now need a trad­ing policy

From 1 Jan­u­ary 2011 list­ed com­pa­nies are required under ASX List­ing Rule 12.9 to adopt a trad­ing pol­i­cy. Trad­ing poli­cies are designed to reduce the poten­tial for con­flicts of inter­est and insid­er trading.


Black­out periods 

Dur­ing a black­out peri­od, direc­tors and senior staff are pre­vent­ed from trad­ing in their com­pa­ny’s stock. They are per­mit­ted to trade this stock at any time out­side the des­ig­nat­ed black­out peri­od. The time out­side the black­out peri­od is known as a trad­ing win­dow.

Accord­ing to the ASX, the typ­i­cal black­out peri­od is the peri­od between the close of the com­pa­ny’s finan­cial books and the release to the mar­ket of the com­pa­ny’s half year­ly or annu­al accounts. How­ev­er, many organ­i­sa­tions also have black­out peri­ods for oth­er occasions. 

What you need to consider 

There are var­i­ous ques­tions you need to ask your­self when for­mu­lat­ing a trad­ing pol­i­cy for your cor­po­ra­tion. These include:

  • Who with­in the com­pa­ny will the pol­i­cy apply to?
  • When will there be black­out periods?
  • Which class­es of secu­ri­ty will the black­out peri­ods apply to?
  • Will any excep­tions be grant­ed? If so, to whom?
  • Is the trad­ing pol­i­cy in breach of the Cor­po­ra­tions Act or ASX List­ing Rules?
Com­mu­ni­cate the policy 

The imple­men­ta­tion of a trad­ing pol­i­cy was until very recent­ly a vol­un­tary process. How­ev­er, as it is now com­pul­so­ry, it is impor­tant that all list­ed com­pa­nies cre­ate and imple­ment such a pol­i­cy and ensure that it is effec­tive­ly com­mu­ni­cat­ed to all direc­tors and senior staff. 

As insid­er trad­ing attracts severe penal­ties, includ­ing impris­on­ment, it is imper­a­tive that this new require­ment is not treat­ed as a mere formality.

For fur­ther infor­ma­tion please contact:

If you would like to repub­lish this arti­cle, it is gen­er­al­ly approved, but pri­or to doing so please con­tact the Mar­ket­ing team at marketing@​swaab.​com.​au. This arti­cle is not legal advice and the views and com­ments are of a gen­er­al nature only. This arti­cle is not to be relied upon in sub­sti­tu­tion for detailed legal advice.

Publications

Which edi­tion of Build­ing Code of Aus­tralia applies to devel­op­ments in NSW?

The Build­ing Code of Aus­tralia (BCA) is part of the the Nation­al Con­struc­tion Code (NCC). The NCC is updat­ed every 3 years…

Meta’s AI law­suit in the USA & what it could mean for the future of AI & copyright

Recent­ly, Meta appeared in a US fed­er­al court to defend one of the most close­ly watched copy­right chal­lenges of the AI…

Match­ing Par­ent­ing Orders to Risk: Craft­ing orders to prop­er­ly address the dan­gers in a fam­i­ly law matter

The focus of any par­ent­ing mat­ter being dealt with in the Fed­er­al Cir­cuit and Fam­i­ly Court of Aus­tralia is what…

In the News

Press Release | Swaab’s James Skel­ton Appoint­ed Chair of Glob­al Emerg­ing Lead­ers Advi­so­ry Board at Mer­i­tas AGM in Mex­i­co City

In this piv­otal lead­er­ship role, James will guide ini­tia­tives to strength­en rela­tion­ships among Emerg­ing Lead­ers across Mer­i­tas’ 175 glob­al mem­ber…

Press Release | New Part­ner Appoint­ment — Mark Glynn

With over two decades in the indus­try, Mark is a recog­nised front-end con­struc­tion lawyer spe­cial­ist with­in the build­ing and con­struc­tion indus­try. Mark…

Press Release | New Asso­ciate Appoint­ment — Hugo Mahony

“As we con­tin­ue to expand in line with our strate­gic vision, Hugo’s deep knowl­edge and expe­ri­ence in Com­mer­cial, Cor­po­rate, IP…

Sign up for our Newsletter

*Mandatory information