Date: 28 April 2025
Court: Federal Court of Australia
Judge(s): O’Callaghan, Abraham and Button JJ
Judgment date: 22 April 2025
Catchwords: CORPORATIONS – Managed investment scheme – Financial investment facility – Financial product
CORPORATIONS – Derivative – ASIC appeal – Cross-appeal allowed

Abstract:

The Full Federal Court has allowed an appeal from fintech Web3 Ventures Pty Ltd (trading as Block Earner), holding that its Block Earner product did not constitute a financial product for the purposes of the Corporations Act 2001 (Cth) and this did not require AFSL licensing). The Court reasoned that ASIC had alleged the product was a managed investment scheme, a financial investment facility, or a derivative under the Corporations Act, requiring licensing and registration, however Full Court allowed Block Earner’s cross-appeal, finding the product was not a financial product: customers had no pooled rights to benefits and only received fixed returns. ASIC’s appeal on liability was dismissed, declarations of contravention were set aside, and ASIC was ordered to pay Block Earner’s costs.

Background

Block Earner, offered a product ("Earner") allowing customers...