On Thursday, the Australian Securities and Investments Commission (ASIC) said it welcomed the introduction of new financial market infrastructure (FMI) laws, which are expected to provide the regulator with enhanced powers to ensure “a stable and efficient Australian financial system.”
ASIC Gains New Powers Under Australian Financial Market Infrastructure Reforms
In a press release, the regulator explained that the FMIs, which include entities such as financial market operators, benchmark administrators, clearing and settlement facilities, and derivative trade repositories, play a vital role in facilitating trading in Australia’s capital markets.
The new laws, part of the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024, are said to strengthen the existing regulatory regime and help ASIC to effectively monitor, manage, and respond to risks associated with FMIs.
“The new laws ensure we have a fit-for-purpose regulatory regime for critical financial market infrastructure,” said ASIC Commissioner Simone Constant. “Collectively, these new powers help ASIC ensure the Australian financial system is supported by resilient, efficient, and stable FMIs.”
The new laws are also said to significantly enhance ASIC’s regulatory toolkit, clarify the scope of the Australian licensing regime for overseas markets and clearing and settlement facilities, and empower the regulator to make rules promoting fair and effective service provision by licensed clearing and settlement facilities.
The regulator is expected to work closely with the Reserve Bank of Australia and industry stakeholders.
The new FMI regulatory regime is a result of the Financial Market Infrastructure Regulatory Reforms, which made sixteen recommendations to the Australian Government in July 2020.
Furthermore, the regulator expects the reforms to introduce a crisis management and resolution regime. They are also expected to enhance ASIC and the RBA’s licensing, supervisory, and enforcement powers, as well as streamline responsibilities between the Minister, ASIC, and the RBA.
