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Market supervision and competition cost recovery
Market supervision and competition cost recovery (1 January 2012 to 30 June 2013)—new billing arrangements for ASX and Chi-X participants
This information sheet:
- includes a brief background to the new market supervision cost recovery regime
- outlines the basis for imposing fees on ASX Limited (ASX) and Chi-X Australia Pty Ltd (Chi-X) participants
- provides details about the new cost recovery arrangements applying to participants from 1 January 2012 to 30 June 2013, and
- provides a brief overview of the new billing arrangements.
1. Background to the market supervision and competition cost recovery regime
The new market supervision and competition cost recovery regime provides a mechanism for the Australian Government to recover the funding that it approved in 2009–10 and 2010–11 to cover ASIC’s additional costs for:
- undertaking its new regulatory functions following the transfer of market supervision (on 1 August 2010) and the introduction of market competition (in equity securities), and
- the development of a framework to support market competition.
The new cost recovery regime was developed by Treasury and ASIC in consultation with industry, and complies with the Australian Government cost recovery guidelines.
Please note: ASIC’s costs for continuing to perform the market supervision functions that it undertook prior to the transfer of market supervision are not subject to cost recovery.
2. Basis for imposing fees on participants
In line with the Government’s cost recovery principle that costs should be recovered from those entities that have created the need for regulation, ASIC’s additional expenditure in relation to the cash equities markets (for equity securities) for the period from 1 January 2012 to 30 June 2013 will be recovered from ASX, Chi-X and their participants.
The legal authority for charging participants is set out in the following:
- Section 6A of the Corporations (Fees) Act 2001 (Fees Act) states that the Corporations (Fees) Regulations 2001 (Fees Regulations) may prescribe a fee for the performance by ASIC of its functions in relation to operators of and participants in a licensed market under Part 7.2A (Supervision of financial markets) of the Corporations Act 2001 (Corporations Act).
- The Corporations (Fees) Amendment Act 2011, which commences on 1 January 2012, amends section 7 of the Fees Act to support the charging of participants of licensed financial markets for the performance by ASIC of its market supervision functions under Part 7.2A of the Corporations Act.
- The Corporations (Fees) Amendment Regulations 2011 (No. 2) amend the Fees Regulations to prescribe the quarterly fee arrangements that will apply to operators of and participants in licensed financial markets from 1 January 2012 to 30 June 2013.
3. The new cost recovery arrangements for participants
During the 18 months from 1 January 2012 to 30 June 2013, ASIC’s additional supervisory costs in relation to the participants of the ASX and Chi-X cash equities markets (for equity securities), including the deferred costs associated with implementing market competition, are $22.81 million.
To reflect the different drivers of ASIC’s non-IT and IT cash equities market supervision costs, these costs in relation to participants (for the period from 1 January 2012 to 30 June 2013) will be proportionally allocated to each participant as follows:
- non-IT costs ($14.92 million) will be proportionally allocated based on the number of transactions, and
- IT costs ($7.89 million) will be proportionally allocated based on the number of messages.
For the period from 1 January 2012 to 30 June 2013, the quarterly fee to be paid by each participant will be calculated as follows:
| Participant A’s quarterly fee = | Participant A’s share of ASIC’s total participant related non-IT costs +
Participant A’s share of ASIC’s total participant related IT costs |
| this means: | [$2,486,069 * (multiplied by) No. of transactions for equity securities executed on or reported to the ASX and Chi-X cash equities markets by Participant A during the quarter / (divided by) Total no. of transactions for equity securities executed on or reported to the ASX and Chi-X cash equities markets by all participants during the quarter (as recognised by ASIC’s real-time integrated market surveillance system)]
+ (plus)
[$1,314,876 * (multiplied by) No. of messages by Participant A for equity securities) in the ASX and Chi-X cash equities markets during the quarter / (divided by) Total no. of messages by all participants for equity securities in the markets during the quarter (as recognised by ASIC’s real-time integrated market surveillance system)] |
The transaction and message data that will be used to calculate participants’ fees is the same as that used by ASIC for undertaking its market surveillance activities.
Please note that new fee arrangements, which will be developed by the Government with input from the Market Supervision Cost Recovery Stakeholder Panel, will take effect from 1 July 2013. As part of the post-competition cost recovery framework for ASIC’s market supervision costs, the Government announced that it will establish a Market Supervision Cost Recovery Stakeholder Panel to provide stakeholder perspectives to the Government on future ASIC financial market supervision proposals and approaches for cost recovery.
4. The billing process
Timing of the invoice statements
(a) When will participants receive their invoice statements from ASIC?
Participant fees will be charged quarterly in arrears.
The relevant billing periods are each period of three months starting from 1 January 2012, 1 April 2012, 1 July 2012, 1 October 2012, 1 January 2013 and 1 April 2013.
ASIC will send invoice statements to each participant by post within two weeks of the end of each billing period.
View example of the invoice statement
Paying your invoice statement
(b) When are fee payments required to be made to ASIC?
To give participants sufficient time to arrange their payments, Regulation 9 of the Fees Regulations was amended by the Corporations (Fees) Amendment Regulations 2011 (No. 2) and does not impose a liability for late payment penalty fees unless quarterly fees remain unpaid 60 days after the quarterly fee liability is incurred.
This means that participants will have in excess of 30 calendar days to pay their fees after receiving their invoice statements.
The corresponding payment due date for each billing period is shown in the table below.
Payment due date for each billing period
| End of billing period | Payment required (on or before) |
| 31 March 2012 | 30 May 2012 |
| 30 June 2012 | 29 August 2012 |
| 30 September 2012 | 29 November 2012 |
| 31 December 2012 | 1 March 2013 |
| 31 March 2013 | 30 May 2013 |
| 30 June 2013 | 29 August 2013 |
It is your responsibility to ensure that your payments reach us on or before the due date. In the case of EFT and BPAY payments, we recommend that you check your financial institution's processing deadlines as these payments can take two to three business days to reach ASIC.
| How to pay your bill: Phone ASIC on 1300 300 630 |
(c) What payment methods are available?
ASIC accepts payment for market supervision invoice statements by:
- mail (cheque);
- in person at an ASIC Service Centre (cash or cheque);
- EFT (pay funds into ASIC's bank account directly from your bank account using the internet banking site of your financial institution); and
- BPAY (telephone and internet banking from your cheque, savings, debit, credit card or transaction account).
(d) What should participants do if they don’t receive an invoice statement from ASIC?
Participants will be directly invoiced by ASIC.
If you believe you should have received an invoice statement from ASIC, please contact ASIC:
Questions about your invoice statement
(e) What should participants do if they have a question about their invoice statement?
If you have any question/s about the payment methods, or would like to confirm whether ASIC has received your payment or the amount of late payment fees, please email a detailed description of your question/s to Billingenquiries@asic.gov.au. Please include your ASIC account number, which is located on the left hand side of your invoice statement, the date your invoice statement was issued and your contact details in your email.
Any questions in relation to ASIC market supervision fees on your invoice statement should be raised with ASIC within 14 calendar days after the issue date of the invoice statement. Please note that you will still be required to settle your invoice in full with ASIC. Any necessary adjustments to your fee liability following ASIC's review will be reflected in a subsequent invoice statement.
If you have a question about the fee for ASIC market supervision on your invoice statement, please email market.participants@asic.gov.au. Your question should include your ASIC account number, which is located on the left hand side of your invoice statement, the date your invoice statement was issued, your contact details and a detailed description of your question. Alternatively, please contact your ASIC Relationship Manager. If your ASIC Relationship Manager is unavailable, please contact Amanda Mark on (02) 9911 2119.
Late payment charges
(f) What happens if participants do not pay their invoice statements within 60 days (from the day after the end of each billing period)?
Regulation 9 of the Fees Regulations was amended by the Corporations (Fees) Amendment Regulations 2011 (No. 2) and imposes a liability for late payment penalty fees if quarterly fees remain unpaid 60 days after the quarterly fee liability is incurred.
Regulation 9 of the Fees Regulations provides that late payment penalty charges will be charged at 20% per year, and charged twice monthly on the 6th and 20th calendar day of each month.
Legal action may also be taken by ASIC (on behalf of the Commonwealth) to recover any outstanding fee liabilities.
See our FAQs for more information
(g) What correspondence will participants receive from ASIC about their invoice statements?
ASIC will email a copy of the outstanding invoice statement to those participants that haven’t paid their fees after 45 calendar days (from the day after the end of each billing period). Please do not ignore this email. Contact ASIC immediately to discuss your invoice statement.
Please note that, for the billing quarters ending March 2012 and June 2012, ASIC will also call those participants that haven’t paid their fees around one week prior to the payment due date.
(h) What correspondence will participants receive if they have not paid their invoice statement within 60 days (from the day after the end of each billing period)?
Regulation 9 of the Fees Regulations provides that late payment penalty charges are to be charged at 20% per year, and charged twice monthly on the 6th and 20th calendar day of each month.
Late payment charges will be posted to those customers' accounts who incur such fees 3 - 4 business days after the 6th and 20th calendar day of each month. These customers will also receive an additional invoice statement shortly thereafter. The additional invoice statements will show the amount of late fees that have been charged to their account on the relevant charging day (the 6th or 20th of each calendar month).
For more information:
Contact ASIC if you have any inquiries about the billing process:
Further information on market supervision and competition cost recovery and billing is located on ASIC’s website at www.asic.gov.au/markets. Information available on the site includes:
You can also subscribe to receive regular updates from ASIC on billing and other issues (www.asic.gov.au/market-supervision).
Important notice
Please note that this information sheet is a summary giving you basic information about a particular topic. It does not cover the whole of the relevant law regarding that topic, and it is not a substitute for professional advice.
You should also note that because this information sheet avoids legal language, wherever possible, it might include some generalisations about the application of the law. Some provisions of the law referred to have exceptions or important qualifications. In most cases, your particular circumstances must be taken into account when determining how the law applies to you. |
| This is Information Sheet 150 (INFO 150). Information sheets provide concise guidance on a specific process or compliance issue or an overview of detailed guidance. |
ASIC Website: Printed 05/19/2013
