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High Court ruling expands concept of market manipulation
3 hours ago
• Markets
• ASX
By a staff reporter
The High Court of Australia has unanimously ruled that the buying and selling of shares on the Australian Securities Exchange to create or maintain a share price is an offence of market manipulation, in a decision likely to offer the Australian Securities and Investments Commission more power.
"Today the High Court unanimously held that buying or selling shares on the securities exchange operated by ASX Limited, for the sole or dominant purpose of creating or maintaining a particular price, created or maintained an "artificial price" for those shares for the purposes of the offence of market manipulation under s 1041A of the Corporations Act 2001," the High Court said in its judgment summary.
Robert Austin, a Minter Ellison consultant told The Australian Financial Review the ruling expands the concept of market manipulation "significantly".
"It gives ASIC a powerful tool as the principle market regulator," he said.
The case stemmed from an appeal by the Commonwealth Director of Public Prosecutions from the Victorian Court of Appeal over an unnamed person facing 39 counts of market manipulation.
Concerns over the manipulation of the futures market originally led to the introduction of the "artificial price" rule in 1986.