November 2019

Consultation on Financial Market Infrastructure Regulatory Reforms

In November 2019, the CFR released a consultation paper Financial Market Infrastructure Regulatory Reforms. Financial market infrastructures include Australian market licensees, benchmark administrator licensees, clearing and settlement facility licensees and derivative trade repository licensees. These infrastructures provide critical services relied upon by investors and businesses in order to raise capital and finance, borrow and lend funds, invest in equities and debt securities and manage the risks associated with their activities.

The CFR sought comment on the proposals in the paper. Decisions on whether to progress the proposals to the legislative stage will be made by the Government.

The paper sets out three broad sets of reforms proposed by the CFR:

  • Enhancing the licensing regimes. Reforms designed to ensure that the licensing regimes for financial market infrastructures will be fit for purpose and effective into the future.
  • Enhancing Supervision and Enforcement. Enhanced powers for the Australian Securities and Investments Commission and the Reserve Bank of Australia to support their supervision of financial market infrastructures, and their ability to take actions to address any identified deficiencies.
  • Crisis Management and Resolution. Additional proposals that would form part of a resolution regime for domestic clearing and settlement facility licensees. A resolution regime was first consulted on in the 2015 consultation paper Resolution Regime for Financial Market Infrastructures.

Written submissions to the consultation paper closed on 20 December 2019.

Following consideration of the submissions, in July 2020 the CFR provided to the Government its recommended approach to reforming the regulation of financial market infrastructures.

On 8 June 2021, the Treasurer announced that the Government will introduce regulatory reforms. Further details are available in the Treasurer's media release.

At the same time, the CFR published:

Submissions Received

18 submissions were received for this consultation, including 5 confidential submissions. The non-confidential submissions are published below:

Australian Financial Markets Association
10 January 2020

Australian Restructuring Insolvency & Turnaround Association
19 December 2019

Australian Stock Exchange Group
20 December 2019

CHESS Replacement Stakeholder Group
20 December 2019

Chicago Mercantile Exchange Group
20 December 2019

Chi-X Australia Pty Ltd
10 January 2020

Computershare Limited
20 December 2019

Depository Trust and Clearing Corporation
20 December 2019

Intercontinental Exchange Inc
10 January 2020

International Swaps and Derivatives Association
20 December 2019

Macquarie Bank Limited
20 December 2019

National Stock Exchange of Australia Limited
20 December 2019

Yieldbroker Pty Limited
18 December 2019