Financial Markets Conduct Regulations 2014

7 Offeror must not breach $2 million aggregate limit

(1)

A must not breach the $2 million aggregate limit under subclause (2), whether before or after—

(a)

the offer; or

(b)

the issue of the financial products.

(2)

The $2 million aggregate limit is breached if the amount that is raised by A from the issue or transfer of financial products of the issuer under 1 or more relevant offers exceeds $2 million in any 12-month period.

Example

ABC Limited offers debt securities through a peer-to-peer lending facility in June 2015. ABC Limited raises $700,000 under this offer.

ABC Limited also offers ordinary shares through a crowd funding facility in November 2015. ABC Limited raises a further $400,000 under this offer.

ABC Limited also offers ordinary shares through a small offer under clause 12 of Schedule 1 of the Act in February 2016. ABC Limited raises a further $1.5 million under this offer.

In total, ABC Limited has raised $2.6 million from relevant offers. ABC Limited does not breach the small offer requirements in clause 12 of Schedule 1 of the Act. However, the $2 million aggregate limit condition under this clause has been breached and, accordingly, there may be consequences under Part 8 of the Act.

(3)

In this clause,—

financial products of the issuer, in relation to an offer of a financial product (product A), means equity securities and debt securities issued by the issuer of product A (regardless of whether those products are of the same class or kind as those under the offer)

relevant offer means an offer made in reliance on either of the following:

(a)

clause 6 of Schedule 1 of the Act (whether or not it is the same as or separate from the offer to B):

(b)

clause 12 of Schedule 1 of the Act (small offers).