Regulation of Sydney Futures Exchange (SFE)

SFE is regulated under the Corporations Act 2001 (Cth). Under Chapter 7, SFE is obliged to take all reasonable steps to:

  • To the extent reasonably practical, ensure a fair, orderly and transparent market;
  • Comply with the conditions on its Australian Market Licence;
  • Have adequate arrangements for market supervision, including the handling of conflicts of interest, monitoring Participants' conduct and enforcing compliance with the market's operating rules;
  • Have sufficient human, technical and financial resources to properly operate the market and provide the required supervisory arrangements;
  • Have adequate compensation arrangements in relation to the market, as required by the Act  *;
  • Take all reasonable steps to ensure an unacceptable control situation does not exist; and
  • Take all reasonable steps to ensure that no disqualified individual becomes involved in the licensee.

In addition, the Act requires a licensee to provide an Annual Report detailing the extent to which the licensee has complied with its obligations under Chapter 7 of the Act, together with any prescribed information as contained in related regulations. The regulations require the following information to be contained within or otherwise accompany the Annual Report:

  • A description of the activities undertaken by the licensee during the reporting period;
    The resources that the licensee had available and utilised in discharge of its obligations under Chapter 7; and
  • An analysis of the extent to which the licensee considers that the activities undertaken and resources utilised have resulted in full compliance with all of its obligations under Chapter 7.

* Compensation arrangements are provided for by a fidelity fund. For details of the fidelity fund and how to make a claim, please see Fidelity Fund.