Participant Guide A guide to becoming an ASX Participant

Transcription

1 Guide A guide to becoming an ASX ASX. The Australian Exchange ASX Limited (ASX) was created by the merger of the Australian Stock Exchange and the Sydney Futures Exchange in July The ASX Group is one of the world s top-10 listed exchange groups measured by market capitalisation. ASX is a multi-asset class, vertically integrated exchange group. Its activities span primary and secondary market services, including capital formation and hedging, trading and price discovery (Australian Securities Exchange); central counterparty risk transfer (ASX Clearing); and securities settlement for both the equities and fixed income markets ().

2 Becoming an ASX Who are ASX s? ASX offers a range of membership categories that span its trading, clearing and settlement facilities. The application process This guide is designed to help applicants understand the options available to them and to assist applicants complete the ASX Application Form. This guide should be read in conjunction with the ASX Application Form. It contains the following information: Explanation of the different categories of trading, clearing and settlement s Outline of the application process and key contact points within ASX Overview of additional requirements for Off-shore s Links to other relevant documents The full guide is available online in the Application Process folder within the Application Kit on ASX Online: Why become an ASX?

3 Becoming an ASX Who are ASX s? ASX s are broker firms that have satisfied all the ASX requirements to offer a trading service to investors. There are also trading s that offer no client services and trade their own funds as a Principal Trader. In addition to trading services, a number of s are approved Partner to offer with clearing one of and/or the world s settlement top 12 facilities. Rank Exchange Market Capitalisation A$b listed exchange groups measured by market capitalisation (click here to view chart) 1 CME Group $26.7 Be part of a unique group of financial service providers 2 The Hong application Kong Exchanges processand Clearing (HKEx) $19.7 Partner with ASX in exclusively branded 3 This guide Deutsche is designed Börse to help applicants understand the options $16available to them and to assist applicants complete the ASX marketing opportunities Application Form. 4 Intercontinental Exchange (ICE) $14.9 Promotion via the Find a Broker referral service 5 This guide BM+F should Bovespa be read in conjunction with the ASX $12.2 Application Form. It contains the following information: on ASX s website which reaches 17 million people per month 6 Explanation NYSE Euronext of the different categories of trading, clearing and $11.3 settlement s Provision of electronic access to the Australian Outline of the application process and key contact points within ASX 7 London Stock Exchange Group (LSE) $7.5 equity and derivative markets via dedicated gateway Overview of additional requirements for Off-shore s 8 Australian Securities Exchange (ASX) $6.8 Protection - only of ASX s are Links to other relevant documents afforded protection under the National Guarantee 9 Japan Exchange Group $6.7 Fund and Fidelity Fund 10 Singapore Exchange (SGX) $6.6 Regulation - only of ASX s are subject The full guide is available online in the Application Process folder within the Application Kit on ASX Online: to Regulation by ASX under a clear set of rules 11 NASDAQ OMX Group $ TMX Group $2.5 Source: Bloomberg, Oct 2013 Market value of the world s top exchanges Why become an ASX?

4 Becoming an ASX An Exchange re-branded Following the transfer of Market Supervision to the Australian Securities Investment Commission (ASIC) on 1st August 2010, ASX has taken the opportunity to re-brand some of its entities. This table shows the current and former branding of those entities within the ASX Group: CURRENT ABBREVIATION CURRENT NAME FORMER ABBREVIATION FORMER NAME Know the rules? ASX ASX Limited (ABN ) ASX ASX Limited ASX Clear ASX Clear Pty Limited (ABN ) ACH Australian Clearing House Pty Limited Pty Limited (ABN ) ASTC & Transfer Corporation Pty Limited ASX 24 Australian Securities Exchange Limited (ABN ) SFE Sydney Futures Exchange Limited ASX Clear (Futures) ASX Clear (Futures) Pty Limited (ABN ) SFECC SFE Clearing Corporation Pty Limited

5 Becoming an ASX An Exchange re-branded Following the transfer of Market Supervision to the Australian Securities Investment Commission (ASIC) on 1st August 2010, ASX has taken the opportunity to rebrand some of its entities. This table shows the current and former branding of those entities within the ASX Group: CURRENT ABBREVIATION ASX ASX Clear CURRENT NAME ASX Limited (ABN ) ASX Clear Pty Limited (ABN ) FORMER ABBREVIATION ASX ACH FORMER NAME ASX Limited Australian Clearing House Pty Limited Know the rules? s enter into a binding contractual relationship with ASX. This relationship is recognised in the Corporations Act 2001 (Cth). s agree to be bound by the relevant ASX rules. ASX Market s and ASX 24 Trading s are also required, under Australian law and under contract with ASX, to comply with the Australian Securities and Investments Commission (ASIC) Market Integrity Rules. Pty Limited (ABN ) ASTC & Transfer Corporation Pty Limited ASX 24 Australian Securities Exchange Limited (ABN ) SFE Sydney Futures Exchange Limited ASX Clear (Futures) ASX Clear (Futures) Pty Limited (ABN ) SFECC SFE Clearing Corporation Pty Limited

6 What type of participant are you? The ASX market provides for Trading, Clearing and Settlement participants to transact in such products as Equities, Exchange Traded Options and ASX Futures, while the ASX 24 market provides for Trading and Clearing participants to transact in exchange traded products such as Futures and Contracts for Difference (CFDs). Applicants can apply to become either a Trading or a Principal Trader on either or both of these markets. Please click on the boxes below for more information: ASX Trading ASX Clearing

7 ASX Trading Close ASX ASX 24 Cash Markets Derivatives Markets Market Principal Trader Market Principal Trader Market Principal Trader Making Markets Provides execution services for your organisation and your Transact on their own account and do not provide execution services to Provides execution services for your organisation and your Transact on their own account and do not provide execution services to Provides execution services for your organisation and your Transact on their own account and do not provide execution services to Direct access to Cash market via a connection to the ASX Trading platforms (unless becoming an ASX Clearing ) Direct access to Cash market via a connection to the ASX Trading platforms (unless becoming an ASX Clearing ) Direct access to Derivatives market via a connection to the ASX Trading platforms (unless becoming an ASX Clearing ) Direct access to Derivatives market via a connection to the ASX Trading platforms (unless becoming an ASX Clearing ) Direct access to the market via a connection to the ASX 24 Trading platforms (unless becoming an ASX Clearing for Futures) Direct access to the market via a connection to the ASX 24 Trading platforms (unless becoming an ASX Clearing for Futures) Refer to ASX Operating Rules Refer to ASX Operating Rules Refer to ASX Operating Rules Refer to ASX Operating Rules Refer to ASX 24 Operating Rules Refer to ASX 24 Operating Rules 1000, 1001,1002, , 1001,1002, , 1001,1002, , 1001,1002, , 1001, , 1001,1002

8 ASX Trading Close Provides execution services for your organisation and your Direct access to Cash market via a connection to the ASX Trading platforms (unless becoming an ASX Clearing ) Cash Markets Transact on their own account and do not provide execution services to Direct access to Cash market via a connection to the ASX Trading platforms (unless becoming an ASX Clearing ) ASX ASX 24 Provides execution services for your organisation and your Direct access to Derivartives market via a connection to the ASX Trading platforms (unless becoming an ASX Clearing ) Derivatives Markets to discuss the Market Principal Trader Market Principal Trader Market Principal Trader Transact on their own account and do not provide execution services to Direct access to Derivartives market via a connection to the ASX Trading platforms (unless becoming an ASX Clearing ) Provides execution services for your organisation and your Direct access to the market via a connection to the ASX 24 Trading platforms (unless becoming an ASX Clearing for Futures) Making Markets If either a Market or Principal Trader wishes to make markets in either Warrants or Derivatives they should contact ASX Customer Management contracting terms and conditions. Transact on their own account and do not provide execution services to Direct access to the market via a connection to the ASX 24 Trading platforms (unless becoming an ASX Clearing for Futures) Refer to ASX Operating Rules Refer to ASX Operating Rules Refer to ASX Operating Rules Refer to ASX Operating Rules Refer to ASX 24 Operating Rules Refer to ASX 24 Operating Rules 1000, 1001,1002, , 1001,1002, , 1001,1002, , 1001,1002, , 1001, , 1001,1002

9 ASX Clearing Close ASX Clear ASX Clear (Futures) Cash Markets Derivatives Markets General Direct General Direct Clearing A Third Party Clearer that clears Cash CCP Transactions for itself, its own, Market s and their and other s and their Agreement Clears Cash CCP Transactions for itself and its own Must be General of ASX Settlement unless solely clearing ASX Futures A Third Party Clearer that clears Derivatives CCP Contracts for itself, its own, Market s and their and other s and their Agreement Adhere to capital requirements Section 1, Capital Requirements Guidance document Clears Derivatives CCP Contracts for itself and its own Must be General of ASX Settlement unless solely clearing ASX Futures Adhere to capital requirements Section 1, Capital Requirements Guidance document Clears Futures and CFDs for itself and its own Also provide clearing services to non clearing ASX 24 s and Principal Traders Requires a Clearing Guarantee for each non clearing ASX 24 and Principal Trader for whom they clear Adhere to capital requirements Section 1, Capital Requirements Guidance document Refer to ASX Clear Operating Rules 3.1, 3.2 Refer to ASX Clear Operating Rules 3.1, 3.2 Refer to ASX Clear Operating Rules 3.1, 3.2 Refer to ASX Clear Operating Rules 3.1, 3.2 Refer to ASX Clear (Futures) Operating Rules 4.2, 4.4

10 Close Austraclear Austraclear General Account Specialist Settlement Admitted for purposes including the holding, transfer and settlement in Batch Settlement of Approved Financial Products in the Settlement Facility May also act in the Settlement Facility as a settlement agent on behalf of an ASX Clear Establish and maintain Sponsored Holdings Participate in certain aspects of the holding and transfer of Approved Financial Products but do not participate in Batch Settlement in the Settlement Facility Establish and maintain Sponsored Holdings Admitted for limited purposes including acting as Offeror in relation to a takeover scheme or for processing an Allocation Component in DvP Batch Settlement Refer to Operating Rules Refer to Operating Rules Refer to Operating Rules

11 Close Austraclear General Admitted for purposes including the holding, transfer and settlement in Batch Settlement of Approved Financial Products in the Settlement Facility May also act in the Settlement Facility as a settlement agent on behalf of an ASX Clear Establish and maintain Sponsored Holdings Account Participate in certain aspects of the holding and transfer of Approved Financial Products but do not participate in Batch Settlement in the Settlement Facility Establish and maintain Sponsored Holdings Austraclear Austraclear is the sole Central Securities Depository (CSD) of Debt Securities in Australia and offers participants true Delivery versus Payment (DvP), exchanging cash for securities irrevocably and in real-time. More about ASX Austraclear Specialist Settlement An Austraclear account will need to be established by all Clearing and/ or Settlement s for the settlement of Admitted Margin Calls for limited and Contributions purposes and additional including Cover acting (CAC) Calls. Alternatively, as Offeror s in relation could to a nominate an existing takeover Austraclear scheme or for account if out-sourcing processing arrangements an Allocation are made with an existing Component Austraclear in DvP. Batch Settlement For more information, please contact ASX Customer Management at or participants@asx.com.au. Refer to Operating Rules Refer to Operating Rules Refer to Operating Rules

12 The process and timeframes The time taken to process an application will vary depending on the membership type requested and the applicant s circumstances. ASX will not commence processing an application until a complete Form (including all Annexure) has been received and accepted as complete. In ASX s experience the most common reasons for delays are: Incorrect or incomplete information submitted Errors in risk-based capital requirement calculations submitted Infrastructure provisioning/connectivity Involvement of off-shore regulators where an entity is based off-shore or trading on behalf of off-shore based Applicants that are required by law to hold an Australian Financial Services Licence (AFSL) or to modify an existing AFSL should contact ASIC early in the process in order to minimise possible delays in obtaining ASIC regulatory approval. Any timeframe estimates provided by ASX do not include the time that it takes an applicant to satisfy any ASIC or overseas regulator requirements, including the time taken to receive an AFSL or to comply with ASIC Market Integrity Rules.

13 What are the steps? 5a. 6a. 7a Application meets requirements ASX Customer Management prepares submission ASX Management reviews submission Admission Pre-lodgement discussion Applicant completes application form Submit form to ASX Customer Management Application assessment - ASX Rules 5b. 6b. 7b. Application does not meet requirements Applicant to provide more information Rejected Information for foreign applicants Where an applicant is not incorporated or resident in Australia, or where an applicant intends to trade on behalf of who are not resident in Australia, additional requirements for ASX and for the applicant may arise as a result of laws in overseas jurisdictions. ASX has in place arrangements with Hong Kong, Singapore, USA and UK market regulators to facilitate access to ASX markets. Due to the overseas laws, however, these arrangements may not cover all products or all off-shore client types. Refer to Rule/Procedure 6400 for more information.

14 How do new s establish operations? The main steps involved in establishing operations for a new ASX will vary depending on how you have organised your business and the type of operation you plan to run. ASX Operations will coordinate all aspects of the establishment process. 1. ASX Operations will assist s in establishing appropriate market infrastructure in their offices and/or data centre facilities, and to gain access to the relevant ASX systems. 2. ASX Information Services can provide various electronic signals containing trading information to new s. Market Information can also connect you to our Voiceline service. This is a public address service over which price-sensitive listed company announcements and Market Control information is provided. 3. You will need to establish a bank account for client funds with an Approved Deposit Taking Institution (ADI) (if applicable). 4. You will need to open mail, telephone, internet and distribution channels in order to obtain access to ASX Online to maintain details and make changes to the ASX database, to access the ASX Operating Rules, and receive other ASX information and directions. You should also note these steps are not sequential and can be implemented concurrently to reduce the time required to establish your operations.

15 Fees and charges for gaining access to ASX markets To access the current fees and charges in detail, refer to the Schedules of Fees available on the ASXOnline website. If your application to become an ASX is not accepted, ASX will refund your application fee. However, if you withdraw your application, your fee will be refunded, less ASX s administration and processing costs, and any related infrastructure costs. A direct debit form is the preferred method of payment and is attached to the ASX Application Form. Alternatively, payment may be made via EFT or by cheque. ASX Participation ASX 24 Participation Trading Clearing Settlement Type Market (Broker) Principal Trading ASX Clear (General) ASX Clear (Direct) (General) (Account) (Specialist) Direct Market Access Act for ASX PARTICIPATION Application & Administration fee ASX Trade YES A$25,000 + GST A$ GST YES ASX Trade NO A$25,000 + GST A$ GST NO CHESS/DCS YES A$50,000 + GST A$ GST YES CHESS/DCS YES A$25,000 + GST A$ GST YES CHESS YES A$10,000 + GST A$ GST YES CHESS YES A$5,000 + GST A$ GST CHESS N/A A$5,000 + GST A$ GST Annual fee AFSL Requirement For Further Information YES YES Guide to Becoming an ASX Guide to Becoming an ASX Guide to Becoming an ASX Guide to Becoming an ASX Guide to Becoming an ASX Guide to Becoming an ASX Guide to Becoming an ASX Type ASX 24 Trading ASX 24 Principal Trading Clearing of ASX Clear (Futures) Direct Market Access ASX Trade24 ASX Trade24 Act for Clients ASX 24 PARTICIPATION Application & Administration Fee Annual Fee AFSL Requirement YES $25,000 + GST Waived YES NO $25,000 + GST Waived NO For Further Information Guide to Becoming an ASX Guide to Becoming an ASX SECUR YES $25,000 + GST Waived YES Guide to Becoming an ASX *Goods & Services Tax (GST) = 10% *Goods & Services Tax (GST) = 10%

16 Contacts ASX Customer Management participants@asx.com.au Useful Websites ASX Public Website: ASX Online: ASX Operations participant.operations@asx.com.au For overseas enquiries: Asia Andrew Musgrave Regional Manager, Asia andrew.musgrave@asx.com.au ASIC: Disclaimer This is not intended to be financial product advice. To the extent permitted by law, ASX Limited ABN and its related bodies corporate excludes all liability for any loss or damage arising in any way including by way of negligence. This document is not a substitute for the Operating Rules of the relevant ASX entity. and in the case of any inconsistency, the Operating Rules prevail. Europe James Keeley Regional Manager, Europe +44 (0) james.keeley@asx.com.au North America Cynthia Tazioli VP Business Development, North America cynthia.tazioli@asx.com.au Copyright 2013 ASX Limited ABN All rights reserved 2013