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Rex to face probe from corporate watchdog

written by Sandy Milne | May 28, 2020
Rex 340 (Source: Australian Aviation)

After Regional Express chose to publicly spruik its plan to compete with major carriers on capital city routes, the company could face millions in fines.

On 12 May, Rex deputy chairman John Sharp announced to The Australian Financial Review that the company was seeking $200 million to fund the move, without giving prior notice to market regulators or shareholders. This prompted the ASX to pause trading for breaking listing rules.

ALP senator Tony Sheldon called on the Australian Securities and Investments Commission (ASIC) to investigate the announcement, alleging possible breaches of the Corporations Act.

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“Rex’s plans to expand into markets in direct competition with Qantas and Virgin, after having received a disproportionate share of government financial support, are inappropriate and exploitative,” Senator Sheldon said.

“Their failure to inform the ASX of these plans per the ASX listing rules flies in the face of Australian corporate standards.”

Under stringent corporate disclosure laws introduced last year, penalties for breach of continuous disclosure obligations can add up to $10.5 million or 10 per cent of annual turnover, whichever is greater.

According to The Australian, ASIC is currently “assessing Sheldon’s request”.

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However, Rex did respond to the trading freeze, issuing a statement on 20 May saying that it did not consider the information to be “material”, as required under the act.

“Rex has made many announcements of contracts worth several hundreds of millions with barely a ripple on the share price,” said representatives of the airline.

Fly into Spring with Australian Aviation’s latest print edition. Starting from $49.95 a year, you can read comprehensive coverage on all sectors of the industry to keep you in the loop. Get your hands on the subscription today. Subscribe now at australianaviation.com.au.

9 Comments

  • Jake

    says:

    Sadly Rex, your ticket is up.
    Years of hiring ex MP’s for your political push for tax payer funding iss at an end.
    Typical Singaporean CEO cracking the whip and the COO and the like jumping to every word leads to poor leadership decisions and constantly trying to screw over staff that beat you in court almost every time!

    • James

      says:

      Do you honestly think that “their time is up”?

  • Scott

    says:

    Why where these announcements timed mid Virgin bidders forming their indicative offers, now since there is Zero news of Rex Jet operation since?

  • Geoff

    says:

    I wonder if Qantas notified the ASX before it mentioned Project Sunrise to the public, or when it decided to get rid of their 747’s early, or….
    We need less red tape and protectionism. But likewise, Companies need to be more mindful of their most important asset, people’s working and pay conditions.

    • AlanH

      says:

      Agree, but I don’t think the Qantas comparison is the same. They were business enhancement decisions in relation to the provision of services that they already provide. Rex’s announcement to move into Jet services on major trunk routes was a major divergence from their approved operational basis which no-one had foreseen.

  • Wilfred Thessinger

    says:

    Reap what you sow , oh and thanks for f**king over KI when we needed you most.

  • Wilfred Thessinger

    says:

    Rex took away our frequent flyer programme when fuel went up and has not reintroduced it now fuel is free; actually none of this matters after they pulled the plug on KI just to give us another good kick in the nuts after the fires.

  • Tony Naish

    says:

    I use Rex a lot. Excellent airline

  • chrissy

    says:

    Rex is a fantastic Airline…

Leave a Comment

Your email address will not be published. Required fields are marked *

Rex to face probe from corporate watchdog

written by Sandy Milne | May 28, 2020
Rex 340 (Source: Australian Aviation)

After Regional Express chose to publicly spruik its plan to compete with major carriers on capital city routes, the company could face millions in fines.

On 12 May, Rex deputy chairman John Sharp announced to The Australian Financial Review that the company was seeking $200 million to fund the move, without giving prior notice to market regulators or shareholders. This prompted the ASX to pause trading for breaking listing rules.

ALP senator Tony Sheldon called on the Australian Securities and Investments Commission (ASIC) to investigate the announcement, alleging possible breaches of the Corporations Act.

Advertisement
Advertisement

“Rex’s plans to expand into markets in direct competition with Qantas and Virgin, after having received a disproportionate share of government financial support, are inappropriate and exploitative,” Senator Sheldon said.

“Their failure to inform the ASX of these plans per the ASX listing rules flies in the face of Australian corporate standards.”

Under stringent corporate disclosure laws introduced last year, penalties for breach of continuous disclosure obligations can add up to $10.5 million or 10 per cent of annual turnover, whichever is greater.

According to The Australian, ASIC is currently “assessing Sheldon’s request”.

PROMOTED CONTENT

However, Rex did respond to the trading freeze, issuing a statement on 20 May saying that it did not consider the information to be “material”, as required under the act.

“Rex has made many announcements of contracts worth several hundreds of millions with barely a ripple on the share price,” said representatives of the airline.

Fly into Spring with Australian Aviation’s latest print edition. Starting from $49.95 a year, you can read comprehensive coverage on all sectors of the industry to keep you in the loop. Get your hands on the subscription today. Subscribe now at australianaviation.com.au.

9 Comments

  • Jake

    says:

    Sadly Rex, your ticket is up.
    Years of hiring ex MP’s for your political push for tax payer funding iss at an end.
    Typical Singaporean CEO cracking the whip and the COO and the like jumping to every word leads to poor leadership decisions and constantly trying to screw over staff that beat you in court almost every time!

    • James

      says:

      Do you honestly think that “their time is up”?

  • Scott

    says:

    Why where these announcements timed mid Virgin bidders forming their indicative offers, now since there is Zero news of Rex Jet operation since?

  • Geoff

    says:

    I wonder if Qantas notified the ASX before it mentioned Project Sunrise to the public, or when it decided to get rid of their 747’s early, or….
    We need less red tape and protectionism. But likewise, Companies need to be more mindful of their most important asset, people’s working and pay conditions.

    • AlanH

      says:

      Agree, but I don’t think the Qantas comparison is the same. They were business enhancement decisions in relation to the provision of services that they already provide. Rex’s announcement to move into Jet services on major trunk routes was a major divergence from their approved operational basis which no-one had foreseen.

  • Wilfred Thessinger

    says:

    Reap what you sow , oh and thanks for f**king over KI when we needed you most.

  • Wilfred Thessinger

    says:

    Rex took away our frequent flyer programme when fuel went up and has not reintroduced it now fuel is free; actually none of this matters after they pulled the plug on KI just to give us another good kick in the nuts after the fires.

  • Tony Naish

    says:

    I use Rex a lot. Excellent airline

  • chrissy

    says:

    Rex is a fantastic Airline…

Leave a Comment

Your email address will not be published. Required fields are marked *

Rex to face probe from corporate watchdog

written by Sandy Milne | May 28, 2020
Rex 340 (Source: Australian Aviation)

After Regional Express chose to publicly spruik its plan to compete with major carriers on capital city routes, the company could face millions in fines.

On 12 May, Rex deputy chairman John Sharp announced to The Australian Financial Review that the company was seeking $200 million to fund the move, without giving prior notice to market regulators or shareholders. This prompted the ASX to pause trading for breaking listing rules.

ALP senator Tony Sheldon called on the Australian Securities and Investments Commission (ASIC) to investigate the announcement, alleging possible breaches of the Corporations Act.

Advertisement
Advertisement

“Rex’s plans to expand into markets in direct competition with Qantas and Virgin, after having received a disproportionate share of government financial support, are inappropriate and exploitative,” Senator Sheldon said.

“Their failure to inform the ASX of these plans per the ASX listing rules flies in the face of Australian corporate standards.”

Under stringent corporate disclosure laws introduced last year, penalties for breach of continuous disclosure obligations can add up to $10.5 million or 10 per cent of annual turnover, whichever is greater.

According to The Australian, ASIC is currently “assessing Sheldon’s request”.

PROMOTED CONTENT

However, Rex did respond to the trading freeze, issuing a statement on 20 May saying that it did not consider the information to be “material”, as required under the act.

“Rex has made many announcements of contracts worth several hundreds of millions with barely a ripple on the share price,” said representatives of the airline.

Fly into Spring with Australian Aviation’s latest print edition. Starting from $49.95 a year, you can read comprehensive coverage on all sectors of the industry to keep you in the loop. Get your hands on the subscription today. Subscribe now at australianaviation.com.au.

9 Comments

  • Jake

    says:

    Sadly Rex, your ticket is up.
    Years of hiring ex MP’s for your political push for tax payer funding iss at an end.
    Typical Singaporean CEO cracking the whip and the COO and the like jumping to every word leads to poor leadership decisions and constantly trying to screw over staff that beat you in court almost every time!

    • James

      says:

      Do you honestly think that “their time is up”?

  • Scott

    says:

    Why where these announcements timed mid Virgin bidders forming their indicative offers, now since there is Zero news of Rex Jet operation since?

  • Geoff

    says:

    I wonder if Qantas notified the ASX before it mentioned Project Sunrise to the public, or when it decided to get rid of their 747’s early, or….
    We need less red tape and protectionism. But likewise, Companies need to be more mindful of their most important asset, people’s working and pay conditions.

    • AlanH

      says:

      Agree, but I don’t think the Qantas comparison is the same. They were business enhancement decisions in relation to the provision of services that they already provide. Rex’s announcement to move into Jet services on major trunk routes was a major divergence from their approved operational basis which no-one had foreseen.

  • Wilfred Thessinger

    says:

    Reap what you sow , oh and thanks for f**king over KI when we needed you most.

  • Wilfred Thessinger

    says:

    Rex took away our frequent flyer programme when fuel went up and has not reintroduced it now fuel is free; actually none of this matters after they pulled the plug on KI just to give us another good kick in the nuts after the fires.

  • Tony Naish

    says:

    I use Rex a lot. Excellent airline

  • chrissy

    says:

    Rex is a fantastic Airline…

Leave a Comment

Your email address will not be published. Required fields are marked *

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