The corporate regulator released its submission to the Senate Economic References Committee inquiry into forestry MISs on Friday.
The submission lays out the actions ASIC has taken on the schemes, many of which were wound up in the years following the GFC.
The regulator also pointed to its Regulatory Guide 232, which recommended requiring agribusiness schemes to have sufficient cash flow and capital maintained to meet ongoing financial obligations; structure payments for leases to protect investors’ interests in land and other assets required to operate the scheme; and enable the more effective transfer of viable schemes away from a responsible entity in external administration.
ASIC also provided its views on potential areas for reform with reference to proposals in a July 2012 Corporations and Markets Advisory Committee report.
The regulator’s proposals include the potential for a prospective ban on agribusiness MISs; governance and risk management arrangements that apply to MISs; and a more flexible regulatory toolkit.
ASIC also canvassed the potential for the introduction of a statutory compensation scheme.
ASIC commissioner Greg Tanzer said any reforms should be considered within the broad work that has been done “developing potential refinements to the regime as a whole”.
“As a result, we have identified some potential areas for reform that relate to the specific business model of common enterprise schemes, and forestry schemes in particular, as well as potential areas for reform across the broader managed investment scheme sector,” Mr Tanzer said.
