In this edition, we discuss announcements from the Australian Securities and Investments Commission (ASIC) regarding its proceedings against Electro Optic Systems Holdings Limited (ASX: EOS) (EOS) and its former CEO and director for breaches of continuous disclosure obligations and director’s duties, as well as a new process for engagement with scheme of arrangement proponents. We also discuss the application received by the Takeovers Panel in relation to the affairs of Emu NL (ASX: EMU) (Emu) and the passing of draft legislation seeking to reform Australia’s beneficial ownership disclosure regime.
In Over the Horizon, we consider the Consumer Price Index (CPI) figures released for the 12 months to October 2025 and what they might mean for domestic interest rates.
This is the last edition of Boardroom Brief for 2025.
Regulatory
ASIC commences proceedings against EOS and its former CEO and director for breaches of continuous disclosure obligations and director’s duties
On 26 November 2025, ASIC announced that it has commenced proceedings in the Federal Court of Australia against EOS, a manufacturer of space, communications and defence systems, for breaching its continuous disclosure obligations under the Corporations Act 2001 (Cth) (Corporations Act) and ASX Listing Rule 3.1. EOS has admitted that it failed to disclose a significant decline in its 2022 annual revenue forecasts to the ASX for at least 14 weeks after becoming aware that the guidance was overstated. ASIC further announced that it had commenced proceedings against the former CEO and director of EOS, Dr Ben Greene, for allegedly breaching his director’s duties by failing to adequately inform the board about the overstated guidance and voting in favour of resolutions to defer disclosure. ASIC Chair, Mr Joe Longo, emphasised that providing timely and accurate earnings guidance is a core obligation of listed entities and is essential to enable market participants to make properly informed decisions.
Legal
ASIC tweaks approach to engagement in schemes of arrangement
Under the Corporations Act, ASIC plays an important role in vetting documentation prepared for schemes of arrangement, monitoring the integrity of the scheme process and identifying any structural features that may be at odds with the principles governing control transactions in Chapter 6. On 26 November 2025, ASIC announced that it will send scheme of arrangement proponents a set of standard questions when a scheme implementation agreement is entered into to draw attention to material matters that the Court may consider relevant to the exercise of its discretion to approve the scheme. ASIC considers that this procedural change will make its review of explanatory statements for schemes of arrangement more efficient and will assist in providing scheme proponents with an opportunity to address potentially material issues before the draft explanatory statement is lodged for its review. Key topics covered by the questions are expected to include complex or novel issues, the composition of voting classes, interests of (or benefits to) participants outside of their capacity as members, potential conflicts of interests and deal protection arrangements. ASIC will monitor market announcements to determine when scheme implementation agreements have been entered into and it expects unlisted market participants to notify it directly.
Takeovers Panel receives application in relation to the affairs of Emu NL
On 24 November 2025, the Takeovers Panel announced that it had received an application from Mr Oliver Douglas in relation to the affairs of Emu. The application relates to an institutional placement that was conducted by Emu shortly after it announced that it was in a strong financial position and had no need for further funding, and shortly before its annual general meeting, where resolutions were proposed for the re-election of all current directors of Emu and the election of both Mr Paul Ingram and the applicant as directors of Emu were to be proposed. The applicant submits that the placement is a control transaction undertaken for an improper purpose and that certain people acted in concert to influence control of Emu and the composition of its board. A sitting Panel has not yet been appointed and no decision has been made whether to conduct proceedings.
Bill to reform Australia’s beneficial ownership disclosure regime passes Federal Parliament
On 27 November 2025, the Treasury Laws Amendment (Strengthening Financial Systems and Other Measures) Bill 2025 passed the Senate, having earlier passed the House of Representatives. Among other things, the Bill proposes reforms to enhance the beneficial ownership disclosure regime in the Corporations Act 2001 (Cth). These reforms are intended to improve transparency and support stronger regulatory and law enforcement responses to tax and financial crime facilitated by complex legal structures and arrangements. These reforms will commence 12 months after the Bill receives Royal Assent. As noted in a previous edition of Boardroom Brief, the Government expects to engage with stakeholders to further progress policy development work from early 2027, with public consultation to follow afterwards.
Over the Horizon
Release of October 2025 CPI data threatens to reverse positive interest rate expectations
On 26 November 2025, the Australian Bureau of Statistics reported a 3.8% increase to CPI in the 12 months to October 2025, up from 3.6% in the 12 months to September 2025. This figure is well above the trajectory forecast by the Reserve Bank of Australia (RBA) earlier this year and was acknowledged by the Treasurer, the Hon. Dr Jim Chalmers, as being “higher than we would like”. The prospect of rate cuts appears to have vanished overnight, instead replaced by discussion on the possibility of the RBA increasing the domestic cash rate in a bid to return annual CPI inflation to its 2-3% target. Housing was the largest contributor to annual inflation at +5.9%, reflecting the vulnerability of Australia’s economy in this key area. This vulnerability is also recognised by the Australian Prudential Regulation Authority, which announced on 27 November 2025 that it will limit high debt-to-income home lending in response to an increase in riskier lending practices stemming from falling interest rates and ever-increasing housing prices. While economists may disagree on what the latest CPI figures may mean for Australia’s economy and how persistent inflation should be addressed, one thing appears clear – a solution to the domestic housing supply shortage is becoming increasingly and systemically important.