The Australian Securities Exchange will soon be competing with rival Chi-X who has been given in-principle approval to operate in Australia by the Federal Government.
The Minister for Financial Services, Superannuation and Corporate Law, Chris Bowen MP, today announced the Government’s support for competition between markets for trading in listed shares in Australia.
Minister Bowen also announced in-principle approval of Chi-X Australia Pty Ltd’s (Chi-X’s) Australian market licence application.
“The Government’s announcement of support for competition between financial markets operating in Australia is an important step in ensuring that Australia’s financial markets are innovative and efficient, now and into the future,” Mr Bowen said.
Chi-X is a wholly-owned Australian-incorporated subsidiary of Chi-X Global Inc, which already operates markets throughout Europe and Canada.
While competition between financial markets for trade execution services is new to Australia, alternative trading systems have successfully operated in the US and Europe for a number of years.
“The decision of the Government to support competition is a vital step in the development of Australia as a financial services hub,” Mr Bowen said.
A final decision on Chi-X’s licence application will be made after the necessary regulatory framework was in place and other requirements had been met.
“I have received advice from ASIC that Chi-X is well on its way to meeting the legislative requirements necessary to be granted an Australian market licence,” Mr Bowen said.
“I look forward to assessing Chi-X’s final application once it has met all of the necessary requirements and the regulatory framework has been finalised.”
The steps to be undertaken to finalise the regulatory framework include relevant amendments to the Corporations Regulations 2001 and the settling of ASIC-set market integrity rules.
“If final approval is granted, Chi-X’s competing market will not become operational until supervisory responsibilities have transferred to ASIC and an appropriate settling-in period has taken place,” Mr Bowen said.