Modifications to Continuous Disclosure Requirements and the Role of Corporate Knowledge, Intent, Recklessness and Negligence in Breaches: A Discussion

On 25 May 2020 the continuous disclosure provisions in Chapter 6CA of Australia's Corporations Act 2001 (Cth) (‘the Corporations Act) were temporarily modified by a Determination of the Federal Treasurer made pursuant to a package of measures intended to deal with the Coronavirus pandemic. The changes import a requirement of knowledge, recklessness or negligence into s674, s675 and s677 of the Act, and will affect future regulatory actions as well as private actions, including the increasingly common area of ‘shareholder class actions’. This follows a proposal by the Australian Law Reform Commission for a review of the economic impact of the continuous disclosure obligations of entities listed on public stock exchanges and more recent concerns about the effects of the Coronavirus on business and share prices. This article reviews and assesses those changes and how they might change the existing law in this area.