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

When is a loan real­ly an Option Fee? And when is an Option a Contract?

It cer­tain­ly is not news to those of us who deal in the prop­er­ty devel­op­ment space that Rev­enue NSW now…

Dis­missal and Dam­ages for Psy­chi­atric Injury: A Con­trac­tu­al Trap

In the recent deci­sion of Elisha v Vision Aus­tralia Ltd [2024] HCA 50 the High Court of Aus­tralia held that dam­ages for…

Valen­tine’s Day in the Work­place (2025 Edition)

Valen­tine’s Day, the cel­e­bra­tion of romance and roman­tic love, takes place annu­al­ly on Feb­ru­ary 14.While many assid­u­ous­ly avoid what they con­sid­er…

In the News

Michael Byrnes appeared on Break­fast with Ron Wil­son on 2SM on 19 Feb­ru­ary 2025 to dis­cuss the NSW rail dis­pute and the cur­rent appli­ca­tion before the FWC

Michael Byrnes appeared on Break­fast with Ron Wil­son on 2SM on 19 Feb­ru­ary 2025 to dis­cuss the NSW rail dis­pute and…

Michael Byrnes appeared on Break­fast with Ron Wil­son on 2SM on 13 Feb­ru­ary 2025 to dis­cuss legal issues relat­ed to Valen­tine’s Day in the workplace

Michael Byrnes appeared on Break­fast with Ron Wil­son on 2SM on 13 Feb­ru­ary 2025 to dis­cuss legal issues relat­ed to…

Michael Byrnes appeared on Nights with John Stan­ley on 2GB and 4BC on 11 Feb­ru­ary 2025 to dis­cuss legal issues relat­ed to Valen­tine’s Day in the workplace

Michael Byrnes appeared on Nights with John Stan­ley on 2GB and 4BC on 11 Feb­ru­ary 2025 to dis­cuss legal issues…

Sign up for our Newsletter

*Mandatory information