Responding to ASX Query and Aware Letters
- Julian Rockett
- Apr 10
- 4 min read
Written for chairs, directors and CFOs of ASX-listed entities. If you want to understand your board's exposure on this issue, contact JR3 Legal.
If you are a director or company secretary of a small to mid-cap ASX-listed entity, the most likely compliance event you will face is an ASX price query or aware letter. ASX issues hundreds of these each year. They arrive without warning, require a response within a tight timeframe, and the response is published to the entire market.
Getting the response right matters more than most boards appreciate. A poorly drafted response does not just satisfy a procedural obligation — it becomes a permanent public record, read by analysts, investors, regulators, and litigation lawyers. And since mid-2025, the consequences of getting it wrong have escalated significantly.
What ASX Queries and Aware Letters Are
ASX price query of aware letters are issued when there is unusual trading activity in the entity's securities — typically a significant price movement or volume spike that ASX cannot attribute to publicly available information. ASX asks whether the entity is aware of any information that has not been announced that could explain the activity.
An aware letter is issued when ASX has reason to believe the entity may be in possession of market-sensitive information that has not been disclosed. Aware letters are typically more targeted than price queries and often follow a specific event (e.g., a material contract negotiation, a change in financial forecasts, a potential transaction).
ASX's July 2025 Compliance Update flagged a heightened focus on earnings surprises — specifically warning that ASX200 entities should expect an aware letter if their share price moves 10% or more on results day without a plausible explanation. While this guidance was directed at the ASX200, the principle applies across the market: if your share price moves materially on new information, ASX will ask why that information was not disclosed earlier.
How to Respond
The response to a price query or aware letter is typically required within one to two trading days. The response must be authorised by the board or a delegated officer, and it is released to the market via the ASX Market Announcements Platform. Key principles:
Accuracy is paramount. The response is a statement by the entity to the market. If it contains inaccuracies or omissions, it may itself constitute misleading or deceptive conduct under section 1041H of the Corporations Act.
The 'not aware' response must be genuine. If the entity responds that it is 'not aware of any information not already announced', ASX expects that statement to be made on the basis of proper enquiry — not on the basis that the board has not been informed. The distinction matters.
If in doubt, disclose. An entity that responds to a price query with a disclosure (e.g., announcing a material contract, updated guidance, or a change in circumstances) is typically treated more favourably by ASX than an entity that denies awareness and is later found to have been in possession of the information.
The Enforcement Escalation Path
Since 26 June 2025, ASX has operated a formal Close Review Procedure under Compliance Update No. 06/25. Entities that repeatedly fall short of disclosure standards -including entities that provide inadequate or inaccurate responses to price queries and aware letters can be placed under formal close review.
Close review means that all of the entity's announcements are reviewed by ASX Compliance before they are released to the market, for a period of six months. The placement is publicly announced under the entity's ASX code - meaning the market knows. Entities that fail to improve within 12 months face a show cause process and potential delisting.
This is a significant escalation from ASX's previous enforcement approach. Before the Close Review Procedure, ASX's primary tools were price queries, aware letters, and (in extreme cases) suspension and delisting. Now there is a formal intermediate step - one that imposes real operational burden and reputational cost.
At the extreme end of the enforcement spectrum, the consequences are severe. In 2025, the Federal Court ordered iSignthis Ltd (now Southern Cross Payments Ltd) to pay $10 million for breaching disclosure laws and misleading and deceptive conduct. The company's former CEO, Nickolas Karantzis, was disqualified from managing corporations for six years and penalised $1 million personally. ASIC described 'repeated disregard for the law through deliberate acts of non-disclosure.' The case involved, among other things, inadequate responses to ASX queries.
The Practical Takeaway
For boards of small to mid-cap ASX entities, the response to an ASX price query or aware letter should not be treated as a routine administrative task. It is a legal document, published to the market, that may be scrutinised by ASIC if events subsequently suggest the entity was aware of undisclosed information.
The response should be drafted with the same care as any other market disclosure — and by someone who understands both the continuous disclosure obligations under ASX Listing Rule 3.1 and the practical dynamics of how ASX Compliance assesses responses. The person drafting the response and the person lodging it should be the same team.
Julian Rockett is the Principal of JR3 Legal, an ASX specialist corporate law firm and company secretarial practice based in Sydney. He acts as external general counsel and company secretary for ASX-listed entities, primarily in the resources, energy, and technology sectors. Contact Julian directly at julian@jr3legal.com.
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