Ann: Placement, page-46

WHO ARE THEY SOPHISTICATED INV?

What do the regulations prescribe in relation to net assets and gross income?

Regulation 6D.2.03 of the Corporations Regulations (2001)(Cth) (Regulations) provide that a person is eligible to receive a certificate if they have:

• assets of at least $2.5 million; or
• a gross income of $250,000 or more per annum in each of two previous years.

ASIC Guidance on requirements for issuers of sophisticated investor certificates

On its website, the Australian Securities and Investments Commission (ASIC) provides guidance on sophisticated investors.[1] Only qualified accountants can issue sophisticated investor certificates. ASIC expands on the definition of ‘qualified accountant’ as contained in s 88B of the Act, and states that a person is a qualified accountant if they:

• belong to one of the following professional bodies at the declared membership classification; and
• comply with that body’s continuing professional education requirements.

The guidelines contain a list of the professional bodies in Australia as well as the eligible foreign professional bodies. With respect to foreign bodies, ASIC provides that foreign investors and some Australians working overseas may be able to access Australian financial products without triggering significant additional disclosure obligations on the issuer. ASIC provides a further regulatory guide with additional details explaining why and how only these specific bodies are recognised.
Sophisticated investors: precisely what are they? (dundaslawyers.com.au)