gotta laugh, page-11

re: asic taking action against cmq thereit is in black and white the markets not going to like this

04-426 ASIC takes action against Chemeq

Thursday 23 December 2004


The Chairman of the Australian Securities and Investments Commission (ASIC), Mr Jeffrey Lucy today announced that ASIC had filed proceedings in the Federal Court in Perth against listed company Chemeq Ltd.

ASIC alleges that Chemeq, a pharmaceutical company based in Bentley, Western Australia contravened the continuous disclosure provisions of the Corporations Act 2001 (the Act) on seven occasions between February 2003 and 6 October 2004.

In particular, ASIC alleges that Chemeq:

failed to inform the market of the increased costs of constructing and commissioning its manufacturing facility at East Rockingham in Western Australia from February 2003 to August 2004;
failed to inform the market that purchase orders it received from South Africa were subject to a 'sunset' condition that they must be filled by 30 June 2004, and failed to inform the market that the orders would not be filled by this time prior to 30 July 2004;
failed to inform the market of its further funding requirements from 8 June 2004, when it announced it had raised $10m from an issue of shares, to 27 August 2004; and
failed to inform the market that a US patent had been granted during the period 28 September 2004 to 6 October 2004.
ASIC is seeking court declarations that Chemeq failed to comply with its continuous disclosure obligations in accordance with the Corporations Act 2001 (the Act) and the Australian Stock Exchange (ASX) listing rules.
ASIC is also seeking pecuniary penalties against Chemeq. Under the Act, the court may impose a penalty of up to $200,000 for each contravention prior to 1 July 2004. Following the commencement of the CLERP 9 legislation, this penalty has increased to $1 million for a contravention by a body corporate that occurs after 1 July 2004.

'The CLERP 9 law reforms demonstrate that a company's continuous disclosure obligations are significant. ASIC is committed to taking action, where appropriate, when it considers that a listed entity has not complied with its continuous disclosure obligations', Ms Jan Redfern, Executive Director of Enforcement said.

ASIC commenced an investigation following referrals made by the ASX.