New regulations to allow the Australian Investment and Securities Commission (ASIC) to recover costs from market operators and market participants (i.e. stockbrokers) for the supervision of Australia's new and competitive equities market, the exposure draft of the Corporations (Fees) Amendment Regulations 2011, were released for consultation today.
The Assistant Treasurer and Minister for Financial Services and Superannuation, Bill Shorten, said "Competition in Australian financial markets will deliver better returns for investors by giving them more choice and better prices. This is expected to attract new players, new trading strategies and new liquidity. We are already seeing the benefits of competition through Chi-X's announcement of a competitive trading fee schedule, as it prepares to launch in competition with the ASX."
In the past the ASX supervised the share market, recovering its costs through fees on market participants. Now ASIC is responsible for market supervision across multiple markets, those costs need to be borne by market operators and market participants directly.
Mr Shorten said, "The draft regulations prescribe the fee amounts or the method of calculation to be used when charging both market operators and market participants on financial markets in Australia."
It is intended that the draft regulations will be in place to start 1 January 2012.
Mr Shorten said "Market supervision is a complex area of policy. To that end I have decided to form a stakeholder panel, to meet quarterly and be chaired by Treasury, to provide stakeholder perspectives to Government on future ASIC financial market supervision proposals and approaches for cost recovery."
An announcement of the members of the Panel will be made soon and it is expected the Panel will hold its first meeting in early 2012.
"The Government appreciates stakeholder responses to the consultation paper on a proposed cost recovery fee structure for the supervision of Australia's financial markets in a multi-operator environment. These submissions were carefully considered in the preparation of the draft regulations. The Government encourages stakeholders to make further submissions on the detail of the draft regulations."
18 October 2011
Background
On 1 August 2010, supervisory responsibility for Australia's domestic financial markets was transferred from market operators including ASX Ltd, to the Australian Securities and Investments Commission (ASIC).
The Government recently consulted on the proposed cost recovery arrangements (Consultation Paper, Proposed Financial Market Supervision Cost Recovery Model, released 26 August 2011).