On 10 June 2025, ASIC announced two initiatives as part of a two-year trial designed to shorten the IPO process:
- ASIC will informally review pathfinder disclosure documents on a confidential basis two weeks prior to public lodgement, in order to reduce the risk of exposure period extension; and
- ASIC has provided a no-action position, allowing issuers to accept applications during the exposure period.
Both initiatives are open to entities listing on the ASX via the ASX fast-track process, and in combination should allow issuers a period of approximately 2 weeks between lodgement and listing. The other conditions of the trial are discussed further below.
These changes mark a very positive development in ASIC’s efforts to improve the attractiveness of public markets and have been implemented in response to the recent decline in Australian IPOs and ASIC’s ‘concern’ for public equity markets more generally (see ‘ASIC Public and Private Markets Discussion Paper – Our submission’). Given most Australian IPOs occur by way of ‘front end bookbuild’, by shortening the IPO timetable, these changes will reduce the period of time that institutional IPO investors are ‘on risk’ between the bookbuild and trading commencing. The shorter the period of risk where the overall market may decline, the lower the likely discount IPO investors may require when committing to acquire shares in the IPO, which will support valuations and the attractiveness of public markets. The shorter process also means the underwriting agreement will be on foot for a shorter period, decreasing deal execution risk.
In addition to the immediate benefits identified above, it also signals ASIC’s seriousness about improving regulatory settings for public markets, and its willingness to act on actionable ideas where it is within ASIC’s power. This was a theme evident in comments from ASIC Chair Joe Longo at the ASIC Symposium: Australia’s Public and Private Markets, which was held in Sydney on 10 June 2025.
The above positive step from ASIC makes ASX’s recent changes to Guidance Note 1, restricting the availability of the fast-track process for certain entities, more unfortunate (discussed further in our ‘ASX Guidance Note 1 update’). The effect is that while the fast-track process is becoming increasingly valuable for larger issuers without mandatory escrow, its restricted availability means smaller issuers or those with mandatory escrow will be at a more pronounced disadvantage from others seeking to list on ASX.
Conditions of trial
The conditions of the trial are:
- The entity must be eligible for the ASX Fast Track application process.
- Entities must email the Pathfinder to prelodgement@asic.gov.au at least 14 days prior to formal lodgement.
- The Pathfinder must not differ in any material respect from the lodged prospectus / PDS other than for final pricing, offer amount and related metrics / financial information and as otherwise agreed with ASIC.
- Normal ASIC review processes may apply in situations where there is an extended delay between the informal review completing and formal lodgement.
- A Pathfinder review by ASIC does not endorse the contents of the Pathfinder or preclude ASIC or a third party from taking action in respect of the lodged prospectus / PDS or the offer it contains.
- ASIC will monitor the effectiveness of the trial period and reserves the right to modify or withdraw the trial at any time.
ASIC no-action position
ASIC will take no regulatory action where an eligible entity accepts a retail investor application during the exposure period.
ASIC’s no action position will only apply to non-quoted securities offered under a disclosure document made during the trial period.
Further, ASIC’s general policy on ‘no action’ will also apply.1 Notably, an ASIC no-action letter:
- is an expression of regulatory intention and provides an indication as to the future regulatory position that ASIC might take;
- does not necessarily preclude third parties from taking legal action in relation to the same conduct, nor does it prevent a court from holding that particular conduct infringes the relevant legislation; and
- is not a guarantee that ASIC will not take action in the future.
Footnotes
- See ASIC Regulatory Guide 108 No-action letters.
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