The Government has released for consultation exposure draft legislation amending the Corporations Act 2001, the Competition and Consumer Act 2010 and the ASIC Act 2001 to facilitate competitive outcomes in the provision of clearing and settlement (CS) services for Australia’s financial markets, including changes to improve competition in the trading of shares and other securities.

While the Corporations Act permits more than one CS facility to handle the clearing and settlement of transactions executed on the one financial market, the current market structure is a monopoly where ASX (through its subsidiaries ASX Clear Pty Ltd and ASX Settlement Pty Ltd) is the sole provider of cash equity CS facility services and CS services.

New rule-making powers in the Corporations Act will allow ASIC, with ministerial consent, to make rules to manage matters related to competition, such as pricing, access, governance arrangements and interoperability.

Amendments to the CCA will provide the ACCC with an arbitration power that will enable binding arbitration of disputes about the terms of access to CS services where those services are covered by a declaration made by the Minister.

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