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In this edition, we cover the Australian Securities Exchange (ASX) consultation response and exposure draft proposing new shareholder approval requirements for dilutive scrip acquisitions and certain changes in listing status by S&P/ASX 300 companies, as well as the criminal sentencing of the former chief executive officer (CEO) of Metigy Pty Ltd (Metigy). In regulatory news, we report on the Australian Prudential Regulation Authority's (APRA) release of an updated draft Prudential Standard CPS 510 Governance (CPS 510). In legal, we consider the Takeovers Panel's (Panel) decision declining to conduct proceedings on the application from Quinbrook Asset Management Pty Ltd as trustee for the Critical Resources Strategy (Quinbrook) in relation to the affairs of Kingsland Minerals Ltd (ASX: KNG) (Kingsland).
In Over the Horizon, we consider the government’s capital gains tax (CGT) backtrack for small businesses and what the broader tax reforms still on track for 1 July 2027 mean for directors navigating M&A, corporate structuring and succession planning.
Governance
ASX proposes shareholder approval for dilutive scrip acquisitions and changes in listing status.
On 17 June 2026, the ASX released its response to the October 2025 consultation on shareholder approval of dilutive acquisitions and changes in admission status, together with an exposure draft of Listing Rule amendments. For entities in the S&P/ASX 300 index, the proposed amendments would introduce a 25% cap on the scrip that can be issued in a regulated takeover or merger without shareholder approval (under Listing Rule 7.2 Exceptions 6 and 7), though shareholders may agree a higher cap, including by amending the company’s constitution or by shareholder approval. ASX Acting Group Executive of Listings, Mr Gavin Skene said the ASX had “heard loud and clear the market’s support for more protections against share dilution in public takeovers and mergers”. The proposed amendments would also introduce a requirement for shareholder approval for an entity’s change in admission category to a foreign exempt listing, or the voluntary delisting of a dual-listed entity with a material Australian shareholder base. Directors of larger (S&P/ASX 300) entities should note that, if adopted, the rule will affect how boards plan and execute large scrip-funded M&A transactions, requiring earlier shareholder engagement and attention to approval timelines and execution risk, for further discussion please see our recent article. Submissions on the exposure draft close on 29 July 2026.
Former Metigy executive sentenced to nine years for misleading investors and misusing his position.
On 19 June 2026, the Australian Securities and Investments Commission announced that the Federal Court of Australia had sentenced Mr David Fairfull, former CEO of Metigy, to nine years' imprisonment, with a non-parole period of five years and four months. Mr Fairfull pleaded guilty to one count of making false and misleading statements to investors and one count of dishonestly using his position as a director for personal gain. The offending related to capital raisings between 2018 and 2021, in which investors paid just over $39 million based on false statements about Metigy’s financial performance. Directors should treat the sentence as a reminder that personal criminal liability attaches to false or misleading representations made to investors and to the use of company funds for private benefit.
Regulatory
APRA proposes to strengthen and streamline board governance, conflicts and director suitability requirements.
On 16 June 2026, APRA published an updated draft of CPS 510 for banks, insurers and superannuation trustees, alongside a response to industry feedback. The new CPS 510 seeks to consolidate five existing prudential standards into one cross-industry prudential standard that sets out requirements for board governance, conflicts management and the fitness and propriety of directors and executives. The new CPS 510 would allow boards to delegate certain APRA board requirements and remove duplicative fit-and-proper reporting now that the Financial Accountability Regime is in place, ending the need to submit forms for approximately 6,000 individuals. APRA Chair Mr John Lonsdale noted that the reforms would lift governance expectations while striking the right balance between safety and efficiency: “in allowing boards more freedom to delegate lower value compliance matters and reducing reporting, our goal is to ensure boards have capacity to direct their attention to the issues of most importance.” Consultation on the new CPS 510 runs until 28 August 2026, with the final standard expected to be released in late 2026 and to take effect from early 2028. Directors of APRA-regulated entities should assess board composition, tenure and conflicts arrangements against the draft and respond before 28 August 2026, while all listed boards should read the draft as a marker of contemporary governance expectations.
Legal
Panel declines to step in on Kingsland dispute.
On 19 June 2026, the Panel declined to conduct proceedings on Quinbrook’s application concerning an alleged undisclosed association between shareholder Bacchus Resources Pty Ltd (Bacchus) and certain Kingsland directors in connection with Kingsland’s proposed acquisition of exploration licences from Bacchus. We discussed the proposed acquisition in a previous edition of Boardroom Brief. The Panel found that no effect on control had been established, as the transaction had progressed only to a non-binding term sheet and, if it proceeded, would require shareholder approval (with Bacchus not voting) and an independent expert's report. While concerned about the delay in Bacchus lodging an updated substantial holder notice, the Panel considered this unlikely on its own to give rise to unacceptable circumstances, as the market was already aware of Bacchus’ holding. This decision is a reminder that association and disclosure allegations remain a common basis for Panel applications.
Over The Horizon
Government announces tax reform implementation for small business and start-ups.
On 18 June 2026, the government announced concessions to the tax reforms introduced in the 2026–2027 Federal Budget, following weeks of industry pressure. The Budget proposed replacing the general 50% CGT discount (available on assets held for at least 12 months) from 1 July 2027 with a smaller, inflation-based discount and a minimum 30% tax rate on any profit. In response to the backlash, the government has carved out small businesses in three ways: the turnover threshold for the small business 50% active asset reduction rises from $2 million to $10 million; a proposed 50% CGT discount for early-stage investors in innovative start-ups (turnover under $50 million and less than 10 years old) is out for consultation; and testamentary trusts, including future ones, are now fully exempted from the new 30% minimum tax. However, the core budget reforms are proceeding: the general 50% CGT discount will be replaced from 1 July 2027, with the discount applying only to gains accrued before that date, and discretionary trusts will face a 30% minimum tax on their income from 1 July 2028, with a three-year window (to 30 June 2030) to restructure under rollover relief. The legislation has passed the lower house but still faces the Senate, and key details remain subject to consultation.