Disciplinary Tribunal

Timely and transparent enforcement activity has a beneficial impact on market behaviour and maintains investor confidence in ASX Market Supervision’s ability to monitor and enforce its Rules.  One of the mechanisms by which it achieves this is through the Disciplinary Tribunal process. The Disciplinary and Appeal Tribunals, through a process of peer review, hear and determine alleged contraventions of ASX Operating Rules and allegations of unprofessional conduct by Participants and their Responsible Executives.

Where an alleged contravention of ASX Operating Rules is proven, the Tribunal can impose a wide range of penalties.  ASX Market Rule 28.3.1 (PDF 221KB) and the ASX Disciplinary Processes and Appeals Rulebook set out the powers that can be exercised by the Tribunal.

This section contains the following:

Function and operation of the Disciplinary Tribunal

The Disciplinary Tribunal is an independent body vested with the responsibility of determining, through a process of peer review, disciplinary proceedings in relation to alleged contraventions of ASX's Operating Rules and in respect of allegations of unprofessional conduct.

The Disciplinary Tribunal has jurisdiction over disciplinary matters in relation to alleged breaches of the following ASX Operating Rules:

  • ASX Market Rules;
  • ASTC Settlement Rules;
  • ACH Clearing Rules;
  • Operating Rules of the Sydney Futures Exchange;
  • Clearing Rules of  the Sydney Futures Exchange; and
  • Austraclear Regulations.

Disciplinary proceedings before the Disciplinary Tribunal are commenced by ASX Enforcement following investigation by ASX Investigations. The Participant involved is entitled to be heard in respect of the allegations made concerning contraventions of ASX Operating Rules in the course of disciplinary proceedings.

ASX Disciplinary Processes & Appeals Rulebook Guidance Note 1 “Disciplinary Proceedings” (PDF 128KB) and the  Rulebook Procedures (PDF 148KB) provides an overview of the procedures followed in respect of disciplinary proceedings.

There is a right of appeal to the Appeal Tribunal against determinations of the Disciplinary Tribunal. There is also a right of appeal where a Participant is dissatisfied with a decision of ASX in relation to a number of ASX Operating Rules. Section 03 – “Appeals” of the Rulebook (PDF 122KB) provides details on the decisions that may be appealed and the exercise of powers by the Appeal Tribunal in appeal proceedings.

Structure of the Tribunal

The Tribunal operates independently of ASX Limited and its Executive Management, and is supported by Legal Counsel.  The Tribunal is comprised of a panel of nominated industry professionals (“the Panel”).  Panel members are selected according to a range of criteria that relate to their skills, experience and qualifications. The peer review Tribunal model ensures industry relevance and confidence.

As at 1 January 2010, the Panel (PDF 20KB) is comprised of 55 members.

The Chairperson of the Disciplinary Tribunal is Mr Philip Chisholm.  The Chairperson of the Appeal Tribunal is Mr Michael Pembroke SC.

Determinations and sanction

The Disciplinary Tribunal hears and determines alleged contraventions of ASX Operating Rules.  Where the Disciplinary Tribunal finds that a contravention is proven, it may impose a variety of sanctions including:

  • Censure;
  • Suspension or termination;
  • Default of commission or gross profit arising from conduct;
  • Fines of up to $1,000,000 (in respect of conduct occurring after 31 March 2008); or
  • Undertaking to complete education and compliance programs.

Section 02 - “Disciplinary Action” of the Rulebook (PDF 114KB) set out the provisions that govern the exercise of powers by the Tribunal in disciplinary proceedings.

ASX Disciplinary Procedures and Appeals Rulebook Procedure ”Annexure A” Disciplinary Tribunal Sanction Guidelines (PDF 101KB) sets out the process adopted by the Tribunal in determining appropriate penalties for breaches of the ASX Operating Rules.

In the financial year 2008/2009, the Tribunal heard 21 matters and determined 31 contraventions.  The Tribunal imposed fines of $862,500 (plus GST).

In the current financial year (as at 1 January 2010) the Tribunal has heard 26 matters involving 43 contraventions and has imposed fines of $1,985,000 (plus GST).

Details of the Tribunal's determinations are set out in disciplinary circulars, notices and bulletins.

Disciplinary matters

ASX releases Participant circulars, bulletins and notices setting out details of the Disciplinary Tribunal's determinations concerning its Participants.  The table contains links to circulars that were released after 1 June 2001.

Code of ethics

The Disciplinary Tribunal is established on the fundamental standards and values incorporated in a Code of Ethics (PDF 35KB).  It is imperative for the integrity of the Tribunal and the process of peer review that Tribunal members ensure that the principles outlined in this Code - such as fairness, independence, accountability, and the handling of conflicts of interest - are adhered to.

Tribunal education

ASX provides a program of education to ensure that Disciplinary Tribunal panel members nationwide are kept up-to-date with the Tribunal's principles, procedures and activities.

ASX considers that it is appropriate that monies arising from penalties determined by the Tribunals be directed to an ASX Education and Research Fund, to be used for the benefit of investor and industry education and research with the objective of continued prevention of market misconduct. 

Tribunal Handbook to assist those appearing before the Tribunals

A handbook has been prepared to assist those persons involved in Tribunal proceedings.  The ASX Disciplinary Tribunal and Appeal Tribunal Handbook was prepared by an independent legal counsel, reviewed by the relevant departments within ASX Markets Supervision and is introduced by the Chairpersons of the Disciplinary and Appeals Tribunals.