Market infrastructure - Australia
Institutions and organisation
Stock Exchanges and related institutions - The ASX Group (www.asx.com.au)
The former Australian Stock Exchange and SFE Corp, the operator of the Sydney Futures and Exchange, merged in July 2006. The merged group was initially rebranded the “Australian Securities Exchange” and is currently marketed as the “ASX Group”. The ASX Group consists of the following business lines:
- Australian Securities Exchange
The Australian Securities Exchange is the brand name used to provide trading services for listed equities, warrants, debt securities (through the market known as ASX) and of derivatives (through the market known as ASX24, the former Sydney Futures Exchange). - ASX Clearing Corporation
The ASX Clearing Corporation is the brand name used to deliver clearing services through ASX Clear and through ASX Clear (Futures). Both companies provide central counterparty facilities and associated services. - ASX Settlement Corporation
The ASX Settlement Corporation is the brand name used to provide settlement services through ASX Settlement (the former ASX Settlement and Transfer Corporation, ASTC) and through ASX Austraclear (hereinafter referred to as Austraclear). - ASX Compliance
ASX Compliance is the brand name used to deliver monitoring and enforcement services of the ASX Group's operating rules.
CBoe Australia (https://www.cboe.com.au)
Cboe Australia was formerly known as Chi-X Australia. It is an alternate trading platform to the ASX. All securities tradable on ASX are also tradable on Cboe. A best order execution process is employed by brokers to receive the better price of the two exchanges.
CSDs
Australia does not have a CSD for ASX-listed securities as these holdings are held directly on the issuers’ records. ASX uses the CHESS system to record the holdings and facilitate electronic and paperless settlement.
Australian unlisted debt securities are held with the Austraclear CSD.
- CHESS (Clearing House Electronic Subregister System)
CHESS is operated by the ASX Settlement Corporation’s wholly owned subsidiary ASX Settlement.
ASX trades are cleared and settled through CHESS. The street side (broker to broker) of ASX trades routinely settles through the daily CHESS net settlement batch. The net settlement batch also supports the client side (settlement between brokers and non-brokers) of ASX trades. Eligible transactions are netted on a multilateral basis, net securities positions are settled through CHESS and net cash settlement is completed via RITS (Reserve Bank Information and Transfer System), a real-time gross payment system operated by the Reserve Bank of Australia.
Positions deposited in CHESS are automatically recorded in the CHESS register, an electronic subregister that forms part of Australian listed companies' principal registers. Each entity admitted to the official list of the ASX is required to participate in CHESS unless the law of a foreign jurisdiction precludes participation. - Austraclear (www.asx.com.au/settlement/asx-austraclear.htm)
Austraclear provides custody and settlement services for a range of Australian debt securities such as Australian Commonwealth and state government securities, semi-government securities, corporate debt, mortgage-backed securities, negotiable bills of exchange, certificates of deposit and commercial paper. Austraclear's RTGS system settles transactions throughout the day: securities are transferred on a gross basis within Austraclear, and cash transfers through the Reserve Bank of Australia's RITS system. In addition to settling eligible securities transactions, Austraclear also offers a two-sided real-time gross payment service using the Reserve Bank of Australia's RITS system (Austraclear matches the payer's and receiver's instructions before settling the payment through RITS).
Central Bank - Reserve Bank of Australia (RBA) (www.rba.gov.au)
Through its Payments System Board the Reserve Bank of Australia (RBA), Australia's central bank, defines the country's payments system policy. The RBA is the operator of the RITS realtime gross payment system.
Regulatory structure
- Australian Taxation Office (ATO) (www.ato.gov.au)
The ATO is the government’s principal revenue collection agency. The role of the ATO is to administer legislation for taxes, superannuation and excise (but not customs duty). - Australian Securities and Investments Commission (ASIC) (www.asic.gov.au)
ASIC is the main regulator and supervisor of Australia's securities markets and of its participants (including ASX Settlement and Austraclear). ASIC enforces Australia's Corporations Law and financial services laws in the securities markets with the objective of protecting investors, consumers and creditors alike. - ASX
ASX Compliance has responsibility for the oversight of listed entities under the ASX Listing Rules and for monitoring and enforcement of compliance with the operating rules by market, clearing and settlement participants. - Australian Prudential Regulation Authority (APRA) (www.apra.gov.au)
The APRA is the regulator and supervisor of Australia's banking system. - Reserve Bank of Australia (RBA)
As an independent government body, the RBA regulates the country's banking and finance sectors. In keeping with Australia's payments system policy the RBA defines and imposes financial stability standards on licensed clearing and settlement facilities (including ASX Settlement and Austraclear). - Council of Financial Regulators
Collaboration between Australia's main financial regulatory agencies is facilitated by the Council of Financial Regulators. The Council comprises representatives from ASIC, APRA, RBA and from Australia's Department of Treasury. Foreign Investment Review Board (FIRB) (www.firb.gov.au)
The Foreign Investment Review Board (FIRB) advises the Australian Government on foreign investment matters and examines proposals by foreign interests intending to invest in Australia. The FIRB's functions are advisory only; responsibility for Australia's foreign investment policy and for making decisions rests with the Treasurer of Australia's Commonwealth Government.- Australian Transaction Reports and Analysis Centre (AUSTRAC) (www.austrac.gov.au)
Australia is a member of the Financial Action Task Force on Money Laundering (FATF) and does not appear on the FATF's blacklist. AUSTRAC, a specialised regulatory agency, was set up under the Financial Transaction Reports Act. The agency's mission is to promote a financial environment hostile to money laundering, major crime and tax evasion. AUSTRAC fulfils its mission in a number of ways: defining the rules that financial service providers must apply in identifying their customers; compiling and analysing suspicious transactions (including international funds transfer instructions); monitoring and identifying money laundering related to serious crime and major tax evasion; providing financial intelligence to the Australian Tax Office (ATO) and to Australian law enforcement and revenue agencies.