Companies Take Heed: The Misleading or Deceptive Conduct Provisions Are Gaining Prominence

Abstract

Provisions that prohibit misleading or deceptive conduct are included in several Australian statutes. The article considers these provisions, with a particular focus on company disclosure matters. It reviews the regulation, empirical research, case law, class actions, and the links and connections across the provisions and with the continuous disclosure obligations. It argues that listed company directors and managers ought to carefully review their public disclosure processes and cultures. The focus and balance of the company disclosure regulatory framework appears to be shifting and the misleading or deceptive conduct provisions are becoming more prominent. Recent high-profile litigation by the Australian Securities and Investments Commission against listed companies alleging misleading or deceptive conduct and contravention of the continuous disclosure provisions has succeeded. Moreover, a growing number of class actions founded on misleading or deceptive conduct and a failure to disclose are being launched and settled.