Part 3: When must the Promoter of Interests in a Horse Racing Scheme be Licensed?

3.1 Part Summary

This part deals with:

  1. the statutory provisions that require any person who is in the business of dealing in interests in managed investment schemes to be licensed and the kind of activity that constitutes “dealing” in interests in such schemes; and<
  2. the ARR that require any person who promotes an “offer of interests” in a horse racing scheme to be licensed, and to be an approved promoter.

Conclusion

Under the Act:

    1. if the scheme falls OUTSIDE of the requirement for registration under section 601ED [because it qualifies as a “private” scheme], then the person who established it WILL NOT require an AFS Licence. To qualify as a “private” scheme, it MUST NOT require registration under section 601ED. In other words, the scheme MUST NOT have more than 20 members and the person who established it MUST NOT be in the business of dealing in interests in such schemes; and
    2. if the scheme falls WITHIN the requirement for registration under section 601ED [because it has more than 20 members or the person (promoter) who established it is in the business of dealing in interests in such schemes], then the promoter MUST hold an AFSL Licence or be an Authorized Representative of a licensee before engaging in the activity.
    There is no statutory exemption or ASIC Instrument relief from this requirement for a “promoter” to be licensed, regardless of whether or not a specific scheme may be relieved by statutory exemption or the terms of the ASIC Instrument from the requirement to be registered.
  1. the manager (and responsible entity) of a horse racing scheme that is:

    1. a registered managed investment scheme;
    2. a personal offer scheme; or
    3. a wholesale scheme;

    MUST be an AFS Licensee.

Under the ASIC Instrument, the members of a syndicate resulting from a lead regulator approved PDS may with the approval of the lead regulator, appoint a manager who is not licensed.

Under the ARR, any person wishing to make an “offer of interests” MUST:

  1. hold an appropriate AFS Licence;
  2. be on the register of approved promoters of a lead regulator; and
  3. obtain approval of a PDS for each offer of interests prior to making the offer.