Aggregated News From Investment Management Regulators

ASIC restricts Smiles Inclusive Ltd from issuing a reduced-content prospectus


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ASIC has restricted Smiles Inclusive Limited (Smiles) from eligibility to issue a reduced-content prospectus until 19 October 2021.

The decision means Smiles will not be able to rely on reduced-disclosure rules and instead must issue a full prospectus if it wishes to raise funds from retail investors.

ASIC’s decision was based on Smiles’ failure to lodge a financial report, directors’ report and auditor’s report for the half-year of the company, ended 31 December 2019, within 75 days, as required under the Corporations Act 2001.

ASIC considers the ability to use a reduced-disclosure prospectus a privilege, dependent on compliance with other aspects of the law, including that companies meet their on-going disclosure obligations.

Where a company fails to comply with its periodic disclosure obligations in a full, accurate and timely manner, ASIC will intervene to ensure that retail investors are protected. In such circumstances, subsequent fundraisings should occur only with the benefit of a full prospectus so that there is adequate disclosure of a company’s prospects and financial position.

Smiles has the right to appeal to the Administrative Appeals Tribunal for review of ASIC’s decision.


A listed company is allowed to offer securities using a reduced-content prospectus containing information relating only to the particular offer itself.

ASIC has the power to prevent a company from relying on these rules if the company breaches its continuous disclosure or financial reporting obligations.

Smiles’ half-year financial report, directors’ report and auditor’s report were required to be lodged with ASIC by 15 March 2020.

On this basis ASIC made a determination under section 713(6) of the Corporations Act 2001, excluding Smiles from relying on section 713 of the Act for 12 months, until 19 October 2021.

Smiles’ securities are currently suspended from being traded on the Australian Securities Exchange.

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Regulator Information

Abbreviation: ASIC
Jurisdiction: Australia

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