In accordance with its Code of Practice commitments, ASX consulted in H1 2014 on enhancements to its service level commitments and Information Handling Standards for the protection of confidential information, including conflict sensitive information, received in connection with the Trade Acceptance Service and the Settlement Facilitation Service. ASX also consulted on the operational and technical standards / procedures for the Trade Acceptance Service and the Settlement Facilitation Service.
In response to the Consultation Paper Clearing and Settlement Services for Approved Market Operators and Approved Listing Market Operators: enhanced service levels and information handling standards, ASX received written submissions from Chi X Australia (Chi X) and Asia Pacific Stock Exchange (APX). The Chi X submission is available here and the APX submission is available here.
The outcome from the consultation process and ASX’s response to consultation feedback is available here.
The Legal Terms for the Trade Acceptance Service and the associated Operational and Technical Standards have been amended following consultation. The Legal Terms for the Trade Acceptance Service dated 1 July 2014 are available here. The Operational and Technical Standards dated 1 July 2014 are available here.
The Information Handling Standards for the Trade Acceptance Service and the Settlement facilitation Service are available here.
Background to the Development of the Code
In developing the Code, ASX undertook a comprehensive public consultation process involving a call for written submissions and over 40 bilateral consultation meetings, 2 industry briefing sessions in Sydney and Melbourne and roundtables with the members of the Australian Financial Markets Association (AFMA) and Stockbrokers Association of Australia (SAA).
On 10 April 2013, a draft Code of Practice for Clearing and Settlement of Cash Equities in Australia (draft Code) was released for comment.
A range of consultation meetings were held with interested stakeholders in Sydney and Melbourne throughout April and early May. Industry briefings were held on 17 April 2013 in Sydney and 22 April 2013 in Melbourne.
Consultation roundtables were held with members of the Australian Financial Markets Association (AFMA) in Sydney on 29 April 2013 and with members of the Stockbrokers Association of Australia (SAA) in Sydney on 6 May 2013.
The consultation period formally closed on 8 May 2013. ASX received 10 written submissions, 2 of which were provided on a confidential basis. The non confidential submissions are available below.
The consultation feedback demonstrated strong support for the draft Code and the establishment of an advisory forum (the Forum) to provide user input to the Boards of ASX Clear and ASX Settlement. Consultation feedback has been incorporated into the final version of the Code.
Revisions to the draft Code following consultation
The draft Code exposed for comment on 10 April 2013 was revised to incorporate the following changes to address consultation feedback:
- including an additional member in the Forum to represent the superannuation industry;
- including a third party clearer in the Forum on the basis that it provides third party clearing for traditional retail / mid tier brokers;
- formalising the role of a business committee, which will be established to provide business and operational input to the Forum. The business committee will meet ahead of Forum meetings;
- setting out the timing of publication of: the agendas and minutes for Forum meetings; the reports from the Forum to the Boards of ASX Clear and ASX Settlement; and the written responses from ASX Clear and ASX Settlement to the Forum;
- the annual international price benchmarking being commissioned from an independent consulting firm, with ASX Clear and ASX Settlement consulting the Forum on the scope and methodology of the international price benchmarking prior to it being commissioned;
- requests for changes to clearing and settlement services being considered by ASX Clear and ASX Settlement in a timely manner;
- where ASX Clear and ASX Settlement agree to a requested change to clearing and/or settlement services by an AMO or an ALMO, advising the requesting customer in writing the priority, indicative timeline and cost of implementing the change;
- consulting AMOs and ALMOs on their respective service level agreements under the TAS and Settlement Facilitation Service;
- consulting AMOs and ALMOs on the development of Information Handling Standards to implement information barriers within ASX to safeguard AMO and ALMO competitively sensitive information;
- ASX’s compliance with the information handling standards for AMOs and ALMOs being subject to internal and external review;
- the internal and external reviews of the operation of the Code being completed and a written report published within 3 months of the end of each financial year; and
- the annual external review of the operation of the Code being undertaken by an independent external auditor.
The revisions to the draft Code to incorporate consultation feedback can be viewed here.
ASX received 10 written submissions on the draft Code. Two submissions were provided on a confidential basis. The non confidential submissions received are as follows. The submissions are in alphabetical order by name of the entity making the submission.
|1.||ABN AMRO Clearing||13/05/2013||2|
|2.||Australian Custodial Services Association||09/05/2013||2|
|3.||Australian Financial Markets Association||08/05/2013||2|
|4.||Association of Superannuation Funds of Australia||08/05/2013||3|
|5.||Commonwealth Bank of Australia Group Participants||08/05/2013||3|
|6.||Chi X Australia||14/05/2013||6|
|8.||Stockbrokers Association of Australia||09/05/2013||3|
- Final Code of Practice for Clearing and Settlement of Cash Equities in Australia
- Final Code of Practice for Clearing and Settlement of Cash Equities in Australia (marked-up against the draft Code released for consultation on 10 April 2013)
- ASX Consultation Paper 'Draft Code of Practice for Clearing and Settlement of Cash Equities in Australia'
- ASX Industry Briefing Presentation - Code of Practice April 2013