Proposed ASX Listing Rule amendment - directors of new listed entities to be of 'good fame and chara

ASX plan to amend the requirements for listing from 1 January 2012 to include a condition that the directors of an entity seeking listing on ASX must be of 'good fame and character'.  The requirement will also apply where a listed entity has to re-comply with the admission requirements pursuant to ASX Listing Rule 11.1.3 (change to nature or scale of activities). (A good 'fame and character' test is applied in other contexts including in relation to admission as a market participant of the ASX and AFS licensing under the Corporations Act.)

ASX propose that listing applications include the following for each director or proposed director:

1. a police/CrimTrac national criminal history check (or its overseas equivalent);
2. an ITSA Bankruptcy check (or its overseas equivalent); and
3. a completed statutory declaration as at listing date affirming (amongst other things) that the director has not been the subject of relevant disciplinary or enforcement action by an exchange or securities market regulator.

ASX will primarily have regard to the above documents to determine if the 'good fame and character' condition has been met, but may also have regard to any other information ASX has about the director or proposed director and may required further information to be provided.

The new requirement will not apply to directors appointed following admission (on the basis that ASX expects appropriate checks to be undertaken on proposed new directors and all material information to be put to shareholders are part of the usual director election process).

Entities contemplating applying for listing on ASX after 1 January 2012 should allow sufficient time for obtaining criminal history and bankruptcy checks as part of their listing process.