08-146 ASIC accepts enforceable undertaking from TZ...

08-146 ASIC accepts enforceable undertaking from TZ Limited

Friday 4 July 2008


ASIC has accepted an enforceable undertaking (EU) from TZ Limited, a listed intellectual property and technology development company.

The EU relates to an alleged failure by TZ Limited to disclose price sensitive information to the Australian Securities Exchange (ASX) in September 2007.

On 20 September 2007, TZ Limited received purchase orders for its technology from a global automotive supplier and a global aircraft manufacturer but did not inform the ASX until 26 September 2007.

TZ Limited’s problem arose because it did not consider that the information was price sensitive and therefore, prior to making an announcement, it sought its customers’ consent under confidentiality agreements with them. The agreements required the customers’ consent before TZ Limited could make a market announcement about the contracts. The company took steps to seek to obtain consent. ASIC alleges that the market was uninformed during the six days between the orders being received and the announcement being made.

ASX Listing Rule 3.1 states that such a confidentiality agreement does not remove the obligation for companies to disclose material information to the market. ASIC was also concerned that TZ Limited did not have formal written policies or procedures regarding its continuous disclosure obligations.

The EU requires TZ Limited to improve compliance with its disclosure obligations through the engagement of an external consultant to review its policies and procedures and to implement subsequent recommendations in accordance with industry best practice. ASIC will receive a six month progress report to monitor the implementation and effectiveness of the recommendations.