The Australian Securities and Investments Commission has published information to better inform investors in frozen funds about their rights in relation to the freezing of funds and to confirm which entities have received relief to assist in the redemption of funds.
The term frozen fund is often used to describe a registered managed investment scheme, originally marketed on the basis that investors had an ongoing or periodic right to redeem their investments on request, a right which has since been suspended.
ASIC recognises there is some confusion among investors about the freezing of funds, which funds are affected and how they can access funds which have been frozen.
ASIC is continuing to working with responsible entities of frozen funds to explore options for affected investors and, where possible, facilitate access to funds.
One of the steps ASIC has taken in response to the issues arising from the freezing of funds has been to provide modifications to the law (relief) to facilitate partial investor access to funds in cases of hardship and subsequently, to simplify the procedure for periodic withdrawal offers out of available cash (called rolling relief). In both cases, the relief is subject to conditions and the responsible entities need to apply to ASIC to rely on this relief.
The information published in Information Sheet 111 identifies which responsible entities have applied for relief (and for which funds) in relation to both the hardship relief and rolling withdrawal relief. It also contains some explanation about why the funds are frozen, the different types of relief that ASIC has granted, the roles of both the responsible entities and ASIC in relation to frozen funds, and member rights.
