Supervision

This section contains information about the transfer of market surveillance powers from the Australian Securities Exchange (ASX) and other markets to ASIC.

Overview

On 1 August 2010 ASIC took over responsibility for supervision of real-time trading on Australia's domestic licensed markets. This supplements its existing responsibility for enforcement of the laws against misconduct on Australia's financial markets and its supervision of Australian financial services licence holders.

This followed the announcement about reforms to the supervision of Australia’s financial markets in August 2009 by the Treasurer and the Minister for Financial Services, Superannuation & Corporate Law, and the announcement by the Minister on 8 July 2010 of a 1 August 2010 start date for the transfer to ASIC of the market supervision role previously performed by ASX and other markets (NSX, BSX, APX and IMB).

ASIC has assumed this important responsibility. We have an integrated market surveillance system in place and we have developed a streamlined markets analysis methodology and relationship management model. We have built and trained a quality Market & Participant Supervision team, consisting of ASIC talent and external people with specialist market experience. The team is complemented by ASX surveillance staff that transferred to ASIC on 1 August 2010. Practically, this means market participants will have more engagement with ASIC in their day-to-day operations. ASIC will become involved in potential market misconduct enquiries at an earlier stage than before.

ASIC is committed to market integrity and a fair, orderly and transparent market.

What's new - markets

Introduction of competition in exchange markets

Market integrity rules

Market integrity rules for the ASX, ASX 24, APX, IMB, NSXA and SIM VSE markets were released on 1 August 2010. Market integrity rules for the Chi-X market and for competition in exchange markets were released on 29 April 2011. We have also issued guidance on these market integrity rules.

Read about and download market integrity rules and guidance

Market supervision reports

ASIC publishes reports outlining key operational statistics and outcomes of its market and participant supervision functions and markets-related deterrence outcomes:

Report released on 21 August 2014

Report released 19 March 2014

Report released 21 August 2013

Report released 26 February 2013

Report released 13 August 2012

Report released 7 February 2012

Report released 13 July 2011

Report released 17 January 2011

ASIC Market Supervision updates

To receive information from ASIC about market surveillance and supervision subscribe to the ASIC Market Supervision Update.

Subscribers will be provided further information such as regulatory updates and notices, and general information about market supervision process.

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Equity market data

ASIC compiles data from all orders and trades in Australian equity market products for each quarter.

We provide data on market characteristics (including volatility), measures of market concentration and measures of market efficiency.

View the quarterly data

Cost recovery regime

The new Market Supervision and Competition Cost Recovery Regime provides a mechanism for the 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; and

  • the development of a framework to support market competition.

The new cost regime was developed by Treasury and ASIC in consultation with industry and complies with the Australian Government Cost Recovery Guidelines.

Consistent with the Cost Recovery Guidelines, ASIC has published a Cost Recovery Impact Statement (CRIS) for the period from 1 January 2012 to 30 June 2013.

More information:

New billing arrangements for ASX and Chi-X participants (1 January 2012 to 30 June 2013)

Frequently asked questions - market supervision and competition cost recovery

Current and past cost recovery impact statements

Markets Disciplinary Panel

The Markets Disciplinary Panel is the main forum for disciplinary action for breaches of the market integrity rules. It is a peer review body, consisting of part-time members with relevant market or professional experience. The current members of the panel have senior roles in broking firms and investment banks.

Read more about the operation and membership of the Markets Disciplinary Panel.

Download Regulatory Guide 216

Markets Disciplinary Panel (RG 216).

Market participants

There were minimal changes from 1 August 2010 to basic trading obligations or participant requirements. Market participants should contact ASIC in instances relating to market integrity rules such as enquiries and information about market behaviour and supervision.

ASIC MPS Participant Compliance Team

ASIC MPS Participant Relationship Team

MPS Compliance surveillances

Broker surveillances

On-site reviews/self assessments

Notices

Remediation plans

Licence conditions

Case build for deterrence referral

AOP certification

Relationship management

Participant profiling via RADAR

Relationship building

Understanding business models/Market technology

Refer suspected misconduct to participant

Compliance for assessment

Accreditation

Participant education

When an entity becomes a market participant, it should make contact with the ASIC MPS Participant Relationship team to establish a relationship manager for their entity. All other enquiries should be directed to contact ASIC or see contact details below.

Australian Market Regulation Feed

To facilitate the monitoring of trading activity, each equity market operator is required to establish a network connection into ASIC's Integrated Market Surveillance System (IMSS), and during the course of each trading day, provide a parallel data feed consisting of:

  • all orders, trades, and quotes being processed and disseminated by the market’s trading engine, and

  • all trading session and security price and status-related messages.

More about the Australian Market Regulation Feed (including specification documents)

Breach reporting

To self-report a breach of the market integrity rules, market participants should continue to use the existing s912D process. Guidance on how to notify ASIC of significant breaches (or likely breaches) by AFS licensees under s912D of the Corporations Act is set out in Regulatory Guide 78. Written breach reports may be:

There is no prescribed form for reporting a breach. However, you can:

  • use Form FS80 on our website at www.asic.gov.au/forms, for lodging written breach reports; or

  • you can report a breach (or likely breach) by giving us a written report.

You can also report breaches to ASIC on 1300 300 630.

More information

Market Supervision Roadshow webcast

Watch roadshow webcast

(You will need to enter your details into the form before watching the webcast.)

 

Retail client adviser accreditation and responsible executive examinations

Find out about retail client adviser accreditation and responsible executive examinations after the transfer of market supervision from ASX to ASIC.

 

Block trade tiers

ASIC publishes, on a quarterly basis, the equity market products allocated to the new block trade tiers that take effect on 26 May 2013. The first publication began on 8 March 2013.

Contact ASIC

phone: 1300 300 630

online enquiry: www.asic.gov.au/question

Other useful sites

Australian Securities Exchange

Australian Financial Markets Association

Corporations and Markets Advisory Committee

Stockbrokers Association of Australia

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Use our online services

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Last updated: 20/10/2014 02:43