ASIC to refresh financial market infrastructure guides

ASIC is updating its regulatory guides to reflect recent reforms to financial market infrastructure (FMI) rules and is seeking industry feedback.

The FMI reforms affect three ASIC regulatory guides that are up for review, following the introduction of Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024.

FMIs include financial market operators, benchmark administrators, clearing and settlement (CS) facilities and derivative trade repositories.

For ASIC and the Reserve Bank of Australia (RBA), the law meant having new powers to monitor, manage and respond to risks related to FMIs.

For ASIC, this resulted in increased capacity to monitor the ongoing conduct of FMI entities, identify risks as they emerge and take appropriate action to prevent those risks from escalating.

Until May 25, ASIC is consulting on updates to: Regulatory Guide 172 Financial markets: Domestic and overseas operators, Regulatory Guide 249 Derivative trade repositories and Regulatory Guide 268 Licensing regime for financial benchmark administrators.

Under RG 172, ASIC proposes changes to how overseas entities should be licensed. This is so it reflects the legislation "for determining whether 'a financial market has a material connection with this jurisdiction', as introduced by the FMI reforms," ASIC said.

The regulator also proposes updating the guidance to require licensees to notify ASIC when a person acquires, or ceases to hold, more than a specified level of voting power in a licensee or its holding company.

The notification threshold increases from 15% to 20% to reflect the higher threshold introduced by the FMI reforms.

ASIC said the updates aim to reflect enhanced licensing, supervisory and enforcement powers, reallocated certain powers between the minister and ASIC, and expand its oversight of foreign entities operating FMIs with a significant Australian nexus.

They also aim to "simplify and clarify existing guidance and ensure ASIC's guidance is market-neutral for financial market licensees where relevant."

ASIC has asked for feedback on whether the guides are sufficiently clear and seeks any suggested changes to them.