On 30 July, ASIC published its response to CP 387 and finalised the rules for Australia's enhanced substantial holding regime. The commencement date hasn't moved: 4 December 2026. What did move, in a few places significantly, is the detail between draft and final.
Here's what managers need to know.
A quick recap
The Treasury Laws Amendment (Strengthening Financial System and Other Measures) Act 2025 amended the Corporations Act to enhance the substantial holding regime, which governs the disclosure of beneficial ownership in listed entities.
The amendments bring equity derivatives and foreign-listed entities into scope for the first time, closing gaps that had previously let significant economic interests in Australian-listed companies go undisclosed. Interests arising from both physically and non-physically settleable derivatives now count toward a substantial holding, and entities incorporated overseas but listed on an Australian financial market are captured under the same disclosure obligations as domestic listed entities.
The reforms take effect on 4 December 2026, one year after the amendment received Royal Assent, and it’s been up to ASIC to fill in the operational details. ASIC set out its proposed approach in Consultation Paper 387 (CP 387) in March, covering a draft legislative instrument, a new standardised Substantial Holding Notice to replace the existing Forms 603, 604, and 605, and updated regulatory guidance. Consultation closed on 21 April, and ASIC's response to submissions landed on 30 July.
The biggest difference between draft and final is ASIC's decision to change the method for working out the number of issued securities in which a person has a "deemed economic interest".
The original proposal used a principle-based delta approach for derivatives without a linear, symmetric payoff profile. Delta indicates how much a derivative's value moves relative to the underlying instrument, giving a more accurate picture of real exposure than a simple notional figure. The final rules drop it in favour of a simplified full notional calculation.
What's worth noting is how ASIC got there.
Few public submissions objected wholesale to the delta approach, but several described the daily delta recalculation as operationally burdensome, and warned it risked making disclosures incomparable across filers. Those objections may well have been raised more forcefully in the confidential submissions, because ASIC undertook a subsequent, targeted consultation on alternatives before landing on notional.
The result is a compromise: a simpler calculation for beneficial owners, though ASIC acknowledges it may overrepresent some interests.
It also introduces some asymmetry (pun intended) with the jurisdictions ASIC's final guidance considers "foreign equivalents". New Zealand and the UK both use the derivative's delta to ascertain the number of equivalent shares. Jurisdictions do this differently, and managers filing in more than one jurisdiction will now be calculating the same exposure two different ways depending on where they're filing.
The calculation method was the question we'd been watching most closely, since it determines what data firms need and how their monitoring has to work. We'd prepared for either outcome, and the divergence between jurisdictions is exactly the kind of detail managers will need to plan for come December.
ASIC made other amendments in response to feedback, most notably to the treatment of derivatives over a basket or index of securities.
The concentration test threshold moved from 20% for single constituents in the draft (aligned with the UK) to 30% in the final, recognising that Australia's market is more concentrated. The higher threshold still captures constituent securities with high weightings, and also accounts for the higher representation of exposure that full notional calculation can produce.
ASIC also added an exception that wasn't in the draft at all: where a derivative references a basket or index tracked or compiled by a major index provider, or tracked by at least one ETF, a person's deemed economic interest or offsetting short position will be zero.
One important caveat on both: the exceptions fall away if the substantial holder or an associate is a bidder in a takeover or scheme of arrangement over the specific security.
The consultation asked whether the existing image-based forms should be replaced with a machine-readable, web-based form. ASIC's answer, for now, is a single consolidated Substantial Holding Notice, with a web-based form still under consideration. ASIC has also released transitional forms, modified versions of the existing Forms 603, 604 and 605, that filers may use until 3 June 2027.
Given the short runway between final guidance and the 4 December compliance date, the path of least disruption is no surprise. We hope the modernised filing system remains genuinely on the table.
The rules are final, the date is fixed, and ASIC declined to defer commencement or offer a no-action position. Managers now have four months to understand the notional calculation, assess their basket and index exposures against the new tests, and prepare to file on a form that didn't exist before.
We're covering all of it with aosphere in our upcoming webinar, Australia's major shareholding reforms: Are you ready? Join us on 18 August for a practical discussion of the changes and what they mean for market participants ahead of December.
Register for the webinar. Can't attend live? Register anyway and we'll send you the recording.