The Australian Securities Exchange Limited (ASX 24) received an order of registration from the U.S. Commodity Futures Trading Commission (CFTC) as a Foreign Boards of Trade (FBOT). The FBOT approval permits ASX 24 to provide its identified members or other participants located in the U.S. with direct access to its electronic order entry and trade matching systems.
The CFTC issued a Part 48 exemption order dated May 22 to the ASX 24 as part of its program of regulatory deference to foreign regulatory frameworks. The Part 48 program of the CFTC provides US customers with increased access to foreign futures markets.
The order also allows the Australian bourse’s members to accept US customer funds directly for trading in futures and options contracts on the ASX 24 without having to register with the CFTC as a futures commission merchant.
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The relief is based on the finding by the CFTC that the local laws and regulations in Australia applicable to ASX 24 members provide a comparable level of customer protection, including licensing standards, minimum financial requirements, and robust compliance programs.
The ASX 24 application for registration included representations that its regulatory regime under its regulator, the ASIC, satisfies the requirements for registration under CFTC regulations.
The CFTC further explained: “In the case of ASX 24, such supervision is carried out by the Australian Securities and Investments Commission (ASIC), which oversees ASX 24’s compliance with relevant requirements, including customer protection and market integrity measures.”
CFTC Chairman J. Christopher Giancarlo added: “By their very nature, derivatives instruments trade in global markets. Cross-border competition, growth, and innovation are stifled if we impose piecemeal or inconsistent regulatory requirements which cause inefficiencies and higher costs. To mitigate such an outcome, the CFTC continues to lead by example to adopt regulatory deference and support market-led activity taking place across these markets.”