ASIC Consults on Consolidation of ASIC Market Integrity Rules

The Australian regulator is proposing the streamlining of its rule books in order to clarify regulations and reduce red tape.

The Australian Securities and Investments Commission (ASIC) today released a consultation paper which seeks to consolidate and clarify Australia’s market integrity rules.

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At present, there are 14 market integrity rule books that set out obligations and prohibitions applying to activities and conduct on eight licensed financial markets. Collectively, these rule books amount to over 1,300 pages of regulation and a further five regulatory guides set out guidance on ASIC’s approach to regulating these markets.

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ASIC is proposing to consolidate 13 of the 14 market integrity rule books into four, covering:

  • ASX, Chi-X, IR Plus, NSXA, and SSX securities markets, and competition between securities markets;
  • ASX 24 and FEX futures markets, and competition between futures markets;
  • Capital requirements for ASX, Chi-X, SSX and NSXA securities markets; and
  • Capital requirements for ASX 24 and FEX futures markets.

Commissioner Cathie Armour commented: “Consolidating the market integrity rules continues ASIC’s focus on reducing red tape and will create a single point of reference for market integrity rules that are common between like markets. It will also streamline the review and consideration of substantive amendments to the market integrity rules in the future.”

ASIC is also proposing the clarification of existing obligations for management requirements and responsible executives, dealing ‘as principal’, block trades and large portfolio trades, disclosures to wholesale clients about derivatives market contracts and record-keeping requirements for market operators.

Background

ASIC is responsible for supervising domestic licensed markets and making market integrity rules. The watchdog assumed responsibility for market supervision and real-time surveillance of trading from ASX in August 2010 and is committed to reducing red tape for market participants by administering the law efficiently with a minimum of procedural requirements. Its previous work in this area includes repealing a number of market integrity rules in May 2015 which are available on its website.

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