ASIC welcomes the new Australian financial market infrastructure (FMI) laws, which introduce new powers essential to ensuring a stable and efficient Australian financial system.
Financial market infrastructures (FMIs) are the key entities that enable, facilitate, and support trading in Australia's capital markets. FMIs include financial market operators, benchmark administrators, clearing and settlement (CS) facilities, and derivative trade repositories.
The Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024 strengthens the existing regulatory regime, ensuring ASIC and the Reserve Bank of Australia (RBA) (together, the Regulators) have strong and dependable powers to monitor, manage and respond to risks related to FMIs.
ASIC Commissioner Simone Constant said: 'The new laws ensure we have a fit-for-purpose regulatory regime for critical financial market infrastructure. The reforms significantly enhance ASIC's regulatory toolkit for FMIs, clarify the scope of the Australian licensing regime for overseas markets and CS facilities, and empower us to make rules to promote the fair and effective provision of services by licensed CS facilities. Collectively, these new powers help ASIC ensure the Australian financial system is supported by resilient, efficient, and stable FMIs.
'We are reviewing our approach to the regulation and supervision of FMIs to ensure that we make the most effective and efficient use of our expanded powers. We will work closely with the RBA and industry to develop and provide information and guidance on the use of our new powers across this multi-year program of change.'
ASIC will now plan and implement the new FMI regulatory regime and update its website with further publications and information, including the development of updated regulatory guidance to assist industry to comply with the enhanced regulatory framework for FMIs.
Background
The Australian Government introduced the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024 (Cth) into the Australian Parliament on 27 March 2024.
The Bill implements the Financial Market Infrastructure Regulatory Reforms: Advice to Government from the Council of Financial Regulators, July 2020 which made sixteen recommendations to Government.
The Bill will:
- introduce a crisis management and resolution regime
- enhance ASIC and the RBA's licensing, supervisory and enforcement powers, which will provide ASIC with more capacity to monitor the ongoing conduct of FMI entities, identify risks as they emerge, and take appropriate action to prevent those risks from escalating, and
- streamline and transfer roles and responsibilities between the Minister, ASIC and the RBA.
The Bill passed Parliament on 9 September 2024 and received Royal Assent on 17 September 2024.
Downloads
- Financial Market Infrastructure Regulatory Reforms - Advice to Government from the Council of Financial Regulators, July 2020
- Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024
