iSignThis launches legal action over ASX share suspension
Payments and Know Your Customer (KYC) solutions provider iSignThis has launched legal action against the Australian Securities Exchange (ASX) over the decision to suspend, then fail to reinstate, trading of its shares.
ISignThis’s (ISX) shares were suspended from trading on 2 October, though the provider said it has not yet been given a reason by the ASX for the move.
In Federal Court documents filed in the state of Victoria, ISX said it is concerned that investors are being denied the opportunity to trade their shares, adding that the suspension could harm its standing with investors, suppliers and customers.
ISX believes its interactions with the ASX during the period of suspension “raise issue of procedural fairness and good faith”, as well as a question as to the actual reason for the decision to suspend trading.
“We have taken this step in order to lift the suspension of ISX’s shares,” the supplier's chairman Tim Hart said. “We are acting in the interest of our shareholders, as they have been denied the basic right to trade our shares for too long.”
In the documents, ISX noted that since suspension, it believes it has answered a number of questions from the ASX about it shares, such as why it selected a European bank to hold client funds and how its revenue is broken down by country. It claims to have also provided answers to ASX queries about Apple's privacy settings and their impact on ISX's business, and confirmed that it does not offer services for initial coin offerings for cryptocurrencies.
“We have answered scored of questions and provided more than 2,000 pages of confidential documents dating back almost three years,” chief executive John Karantzis said. “We have been patient and acted in good faith, but the company’s shares have been suspended for nine weeks.”
Upon announcing the decision to suspend trading, the ASX said this was due to fluctuations in ISX’s share price. ASX Listing Rule 17.3 states that shares may be suspended if an entity is suspected of breaking a listing rule, if a continued listing will lead to a disorderly or uninformed market, or if there is another appropriate reason.
It has not yet specified what this reason may have been. However the ASX has noted that the decision was made without any direction from Australian Securities and Investments Commission, though the trading watchdog was consulted during the process.
The ASX is yet to publish an official response to the Federal Court filing.