On Wednesday, Australia passed a new law that will challenge the near-monopoly status held by ASX Ltd (ASX. AX). The new legislation is designed to promote competition in post-trade settlement and clearing for financial markets.
According to Treasurer Jim Chalmers, “It creates a framework for fair, transparent and non-discriminatory access to market infrastructure for any emerging competitors, allowing them to offer their own clearing and settlement services.”
The new law also gives the Reserve Bank of Australia and the Australian Securities and Investments Commission (ASIC) greater power to set operating standards and intervene on pricing and access disputes.
The push for greater competition in clearing and settlement functions has been called for by Australian financial regulators for many years, but it has been renewed due to a failed overhaul of ASX’s legacy software system.
ASX spokesperson N/A said: “With the new legislation now in place, ASX intends to engage constructively with further consultations on the scope of clearing and settlement services to be covered and the ASIC rules relating to clearing and settlement.”
The new law marks a major shift in Australia’s financial markets, providing more options for market participants and improving the overall competitiveness of Australia’s financial sector. With a new framework in place for fair competition, the market is likely to be more dynamic and open to innovation, giving investors new opportunities to grow their investments.
Source: Reuters
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