Australia Lowers Bar on Public Companies' Disclosures, Extends Virtual AGMs

Australia on Tuesday eased so-called continuous disclosure laws for publicly listed companies, which will now protect companies and their officers against liabilities for misleading and deceptive statements or forecasts unless "fault" is proven, Reuters reported. The new laws come as part of a broader clamp down on the litigation funding industry following a surge in costly class action lawsuits. "These changes will mitigate the risk of companies and their officers being subject to opportunistic class actions under our continuous disclosure laws and in doing so, will support companies and their officers to release forward-looking guidance to the market," Australia's Treasurer Josh Frydenberg said in a statement. "Introducing a fault element will more closely align Australia's continuous disclosure regime with that of the United States and the United Kingdom." The new rules come as the corporate regulator pursues newly listed software company Nuix Ltd for allegedly providing misleading forecasts in its prospectus ahead of its IPO, the country's largest in 2020. The government also passed laws allowing companies to hold annual shareholder meetings or AGMs virtually, instead of in-person, and to execute documents electronically until March 31 next year. Read more.
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