ASX Settlement

Our settlement infrastructure supports the world-class reputation of Australia's financial markets.

We conduct settlement through the Clearing House Electronic Sub-register System (CHESS). CHESS is globally unique in combining settlement services with an electronic sub-register, used to record ownership of shares bought and sold by clients of market participants. CHESS:

• automatically settles equity trades two business days after they take place (T+2)
• simultaneously transfers funds from buyer to seller and ownership from seller to buyer (a process called delivery versus payment (DvP)), and
• facilitates the netting of settlement obligations in each individual equity, providing greater market efficiency at the time of settlement and reducing participant transaction and funding costs.

• Control: investors can choose to have their holdings registered either on the CHESS subregister (broker sponsored registration) or on the issuer sponsored subregister. With CHESS, investors hold securities in their own name, enabling them to retain legal title to their holdings, allowing full portability of assets.
• A consolidated view: all of an investor’s broker sponsored holdings are consolidated under one holder identification number (HIN), providing a consolidated view of their portfolio.
• Standardised holding statements: investors receive monthly holding statements notifying them of any changes to their holdings on the CHESS subregister.
• Ease of administration: when an investor’s address or other details change, they may only need to notify their sponsoring broker (or brokers).
• Ready to trade: securities held on CHESS are ready to trade at any time during trading hours, removing the need to move shares from an issuer-sponsored account onto CHESS. 

• Reduced risk: CHESS reduces the risk to participants of facilitating settlement by expediting both the movement of securities and the timely allocation of shares to client accounts post settlement
• Added value: CHESS also enables participants to provide a value-added service to investors by managing all of an investor's shareholdings in a single account, without the need for additional system development or account consolidation.
• Netting efficiencies: CHESS facilitates the netting of settlement obligations in each individual equity, providing greater market efficiency at the time of settlement and reducing participant transaction and funding costs.

• Seamless investor access: CHESS supports both name-on-register and nominee holding models, providing seamless access for both retail and institutional investors.
• Easy reconciliation and reporting: CHESS holds ownership information electronically in a central register, enabling reconciliation and removing the need for paper certificates. Issuers’ share registries connect to CHESS to receive holding balance updates and related information.
• Cost-effective administration: ASX Settlement sends holding statements on behalf of issuers.

ASX Settlement is a licensed clearing and settlement facility under the Corporations Act. We are required to (among other things):

• to the extent it is reasonably practicable to do so, comply with the Financial Stability Standard (FSS) for Securities Settlement Facilities, published by the Reserve Bank of Australia (RBA) and do all other things necessary to reduce systemic risk
• to the extent that it is reasonably practicable to do so, do all things necessary to ensure that the facility's services are provided in a fair and effective way
• have adequate arrangements for supervising the facility, and
• have sufficient resources to operate the facility properly.

We recognise the importance of meaningful engagement with customers and other stakeholders and have established a range of forums for consultation, including:

• bilateral customer engagement
• industry roundtables
• broad‑based public consultation processes
• ongoing engagement events and working groups as part of the CHESS Project, and
• structured regular engagement through the ASX Business Committee.

Clearing and settlement of cash equities

A dedicated site for information, resources and stakeholder access and engagement on clearing and settlement services.

Code of Practice

Sets out our commitment to customers and other stakeholders in managing cash equities clearing and settlement infrastructure and services for the Australian market.

ASX Settlement Operating Rules

The Operating Rules have the effect of a contract under seal between ASX Settlement, Settlement Participants and others.