On 14 December 2012 ASX made a submission to the Treasury consultation paper Strengthening APRA’s crisis management powers. ASX supported regulators having clear statutory powers to protect the interests of Australian investors and financial market participants, and Australian financial system stability, in the event of a clearing house’s failure.
On 21 December 2012 ASX made a submission to the ASIC consultation paper CP195: Proposed amendments to ASIC market integrity rules ASX24 and FEX markets. ASX supported the enhancements to market integrity rules applying to participants in licensed derivatives markets. The submission also highlighted the importance of end clients having transparency into, and an understanding of, the different risks and potential outcomes they may face when dealing with a foreign-based clearing house in the event of a default.
ASX released on 25 October 2012 a consultation paper Derivatives Account Segregation and Portability, seeking views on potential changes to the derivatives account structures it offers, and the means by which margins are calculated and held, under its central counterparty services for clearing futures, options and other derivative financial products. The potential changes raised in the paper are in response to new regulatory standards (CPSS-IOSCO principles and RBA Financial Stability Standards) and to the growing demands from customers for a client clearing model option which provides greater protection in the event of a clearing participant default.
Submissions closed on 7 December 2012. Public submissions received can be found here.
On 19 October 2012 ASX provided submissions to two related consultation papers on clearing and settlement regulation issued by ASIC and the RBA:
- The ASIC consultation paper CP186 Clearing and settlement facilities: International principles and cross-border policy (update to RG 211). The ASX submission argues that any decision on a licence application from an overseas or domestic clearing house for cash equities listed on ASX should include a full assessment of whether the public interest is served, including a cost-benefit analysis. ASX also reaffirmed views expressed in earlier submissions that it does not agree that a graduated approach is an appropriate way of imposing regulatory standards on foreign clearing and settlement facilities servicing important Australian markets. Such an approach is both inconsistent with a public interest test and practically difficult to implement
- The RBA consultation paper Consultation on New Financial Stability Standards. The ASX submission supports the objectives of the revised RBA Financial Stability Standards in recognition of the important role clearing and settlement facilities play in maintaining systemic stability in Australia. The submission also provides ASX’s initial views on the detailed revisions to ensure that they reflect the characteristics of the Australian market and that they are in line with emerging overseas standards
On 17 October 2012 ASX released for public comment:
The focus of the consultation is the proposed new version of Guidance Note 8, which is intended to provide listed entities and their officers and advisers with clearer, more detailed information to assist them in understanding and complying with their continuous disclosure obligations under Listing Rules 3.1 – 3.1B.
ASX is inviting comments from all interested stakeholders on the consultation materials. Submissions are due by Friday, 30 November 2012.
The slide presentation from the ASX Continuous Disclosure Consultation Roadshow can be viewed here.
On 19 September ASX released a consultation paper outlining a new capital raising service being offered by ASX that will allow ASX listed companies to price and allocate new securities through an on-market, automated bookbuild mechanism called ASX BookBuild®. The key objective of ASX BookBuild® is to improve the transparency, fairness and efficiency of the capital raising process. ASX BookBuild® will provide companies that are listed or seeking listing with an alternative to the current off-market bookbuild process when issuing new securities as part of a placement or Initial Public Offering (IPO).
The consultation period closed on
24 October 2012. ASX received 10 written submissions. Five submissions were received on a confidential basis. Public submissions were made by:
On 18 September 2012, ASX released for public comment draft Listing Rules and Guidance Notes for reserves and resources reporting by mining and oil and gas exploration and production entities. The release of the draft rules is the culmination of an extensive process of consultation with industry and investor stakeholders that was commenced by ASX in October 2011 with the release of the ASX Listing Rules Review Issues Paper. In April 2012, ASX released a Report on Consultation Feedback, which provided a summary of the feedback received from 122 written submission and the 54 roundtables and consultation meetings held by ASX across Australia in late 2011 and early 2012. This feedback has been taken into account in developing the new reporting requirements that have been released for comment.
In parallel to this initiative, JORC has also released for consultation a revised and updated JORC code, which together with the SPE PRMS for oil and gas companies, will underpin the new requirements in the ASX Listing Rules.
Comments on the draft Listing Rules and Guidance Notes are requested by 26 October 2012.
On 14 September 2012 ASX provided a submission to the ASIC consultation paper (CP184), Australian market structure: Draft market integrity rules and guidance on automated trading. ASX’s submission supports ASIC’s proposals for participants level risk controls which complement the controls that ASIC has imposed on market operators.
On 31 August 2012 ASX provided a submission to the ASIC consultation paper CP181: Retail Trading in Commonwealth Government Securities. ASX strongly supports ASIC’s proposals and has developed an operational and legal framework based on the use of depository interests to facilitate trading in CGS. The ASX submission raises some operational issues in relation to implementing this initiative.
The period for submissions to ASX's consultation paper Modernising the timetable for rights issues: facilitating efficient and timely rights issues has now closed. 21 submissions were received. Seven submissions were provided on a confidential basis. Public submissions were provided by:
ISS Governance Services
On 20 August 2012, ASX released a consultation paper ASX 3 and 10 Year Treasury Bond Futures Quarterly Roll. The consultation paper sets out a number of proposals that may improve the efficiency of the bond roll process.
Submissions closed on 28 September 2012. A summary of submissions received is provided in ASX 3 and 10 Year Treasury Bond Futures Quarterly Roll: Summary of Comments. ASX is engaging in further discussions with market participants regarding the feedback received prior to making any final decisions on roll market structure changes.
On 10 August 2012 ASX provided a submission to the Council of Financial Regulator’s consultation paper Competition in the clearing and settlement of the Australian cash equity market. ASX submits that a rigorous cost-benefit analysis is needed before a move away from the existing market structure in Australia (a single clearing house and settlement facility) is considered. ASX welcomes competition where this provides a clear net benefit to the profitability and stability of Australia’s financial markets and improves Australia’s global competitive position.
On 6 August 2012 ASX provided a submission to the ASIC consultation paper (CP179), Australian market structure: Draft market integrity rules and guidance. ASIC’s Consultation Paper 179 raises important issues for Australian financial markets that if not acted on quickly could result in the undermining of the integrity of Australia’s markets and long term investor confidence. ASX believes ASIC should act now with a comprehensive set of measures to protect the quality of the Australian cash equity market rather than risk an incremental approach that may not achieve its objective.
On 3 July 2012, ASX released a consultation paper Modernising the timetable for rights issues: facilitating efficient and timely rights issues. The consultation paper sets out a number of proposals to reduce the standard timetable for rights issues by leveraging off advancements in technology, systems and operational processes.
ASX is inviting comments on the proposals by 14 August 2012.
ASX has today issued a Consultation Paper: Single Stock ETO Expiry: Response to Market Interruptions relating to the management of ETO expiry in the event of a market interruption on expiry day. ASX considers that is appropriate to seek response from the industry given the wide range of feedback received during the ASX TradeMatch® outage that occurred on 27 October 2011.
On 2 April 2012, ASX released a Report on Consultation Feedback summarising the feedback received in response to ASX’s consultation paper on Reserves and Resources Disclosure Rules for Mining and Oil & Gas Companies. The consultation process has confirmed broad support for ASX’s proposals to facilitate greater transparency and consistency in reserves and resources reporting.
ASX intends to release detailed rules on its proposals for an enhanced reporting framework for the disclosure of reserves and resources information by mining and oil and gas companies in the second half of 2012. ASX is continuing to consult with industry stakeholders, including JORC, and with ASIC to develop this enhanced reporting framework.
On 2 April 2012, ASX released Strengthening Australia’s equity capital markets: ASX proposals and consultation setting out a number of proposals designed to facilitate capital raising for mid to small caps and updating ASX’s admission requirements. This package is the first phase of the listing initiatives that ASX is rolling out in 2012 to strengthen Australia’s equity capital markets.
ASX is inviting comment on these proposals to increase the capital raising limit for mid to small caps and to update the admission requirements. Comments are requested by 14 May 2012. See the contact details provided in the document.
ASX is proposing to broaden the range of international equities available on ASX by quoting UDRs (unsponsored depositary receipts). UDRs are conceptually similar to Chess Depositary Interests (CDIs), and will allow investors in the Australian market to obtain an equitable interest in international securities though a security that is traded, cleared and settled on the ASX market. Please note that the ASX UDR program is subject to regulatory approval.
The introduction of the UDR program has given rise to the question of the index eligibility of UDRs. Current index methodology requires index constituents to be listed on ASX. UDRs would be quoted rather than listed and hence would be ineligible for index inclusion under the current methodology.
Given the interest in the index eligibility aspect of the UDR program, S&P and ASX have released this consultation paper and invite submissions by Tuesday 17 April. Responses to the consultation will determine whether to amend the current index methodology such that UDRs become eligible for inclusion in the index (subject to other existing index eligibility criteria being met).
ASX provided a submission to the ASIC consultation paper (CP168), Australian equity market structure: Further proposals (PDF 226KB). The ASIC consultation paper proposed new market integrity rules to address regulatory issues resulting from recent market development in Australia. The ASX submission focuses on issues around dark pool trading and volatility controls to manage extreme price movements.
On 17 January 2012, ASX released a consultation paper - Equity Exchange Traded Options (ETOs) Market - Market Structure Reform Proposals 2012 - 2014 (PDF 263KB). The consultation paper sets out discussion points on the next set of reforms and developments ASX should consider undertaking for the ETO Market. ASX invites comments from interested stakeholders by 30 March 2012.