Corporations Act 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

Note: This Chapter applies to a CCIV in a modified form: see Division 4 of Part 8B.7 .

PART 7.2 - LICENSING OF FINANCIAL MARKETS  

Division 1 - Preliminary  

SECTION 790A  

790A   MEANING OF CLEARING AND SETTLEMENT ARRANGEMENTS  

Clearing and settlement arrangements
for a transaction effected through a financial market are arrangements for the clearing and settlement of those transactions. The arrangements may be part of the market ' s operating rules or be separate from those operating rules.

Division 2 - Requirement to be licensed  

SECTION 791A   NEED FOR A LICENCE  

791A(1)    
A person must only operate, or hold out that the person operates, a financial market in this jurisdiction if:

(a)    the person has an Australian market licence that authorises the person to operate the market in this jurisdiction; or

(b)    the market is exempt from the operation of this Part; or

(c)    

the person is exempt from the operation of this Part.

Note 1: A market licensee may also provide financial services incidental to the operation of the market: see paragraph 911A(2)(d) .

Note 2: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

791A(2)    
For the purposes of an offence based on subsection (1) , strict liability applies to paragraph (1)(b) .

Note: For strict liability , see section 6.1 of the Criminal Code .

791A(3)    

A person contravenes this subsection if the person contravenes subsection (1) .

Note: This subsection is a civil penalty provision (see section 1317E ).

SECTION 791B  

791B   OTHER PROHIBITIONS ON HOLDING OUT  

A person must not hold out:

(a)    that the person has an Australian market licence; or

(b)    that the operation of a financial market by the person in this jurisdiction is authorised by an Australian market licence; or

(c)    that a financial market is exempt from the operation of this Part; or

(ca)    

that the person is exempt from the operation of this Part; or

(d)    that the person is aparticipant in a licensed market;

if that is not the case.

Note: Failure to comply with this section is an offence (see subsection 1311(1) ).

SECTION 791C   EXEMPTIONS BY ASIC  

Exemption of a particular financial market or person

791C(1)    
ASIC may, in writing, exempt:

(a)    a particular financial market; or

(b)    a particular person;

from all or specified provisions of this Part.

Note: The provisions of this Part include regulations made for the purposes of this Part: see section 761H .

791C(2)    
The exemption may apply:

(a)    unconditionally or subject to specified conditions; and

(b)    for a specified period or indefinitely (the exemption duration ).

791C(3)    
ASIC may, at any time, in writing:

(a)    vary an exemption given under subsection (1) to:

(i) impose conditions, or additional conditions, on the exemption; or

(ii) vary or revoke any of the conditions on the exemption; or

(iii) extend or shorten the exemption duration (including as affected by any variation from a previous operation of this subparagraph); or

(b)    revoke an exemption given under subsection (1) .

791C(4)    
However, ASIC may only take action under subsection (3) after giving notice, and an opportunity to make submissions on the proposed action, to:

(a)    if paragraph (1)(a) applies to the exemption - the operator of the financial market covered by the exemption; or

(b)    if paragraph (1)(b) applies to the exemption - the person covered by the exemption.

791C(5)    
An exemption given under subsection (1) , or a variation or revocation made under subsection (3) , is not a legislative instrument.

791C(6)    
If the ASIC gives an exemption under subsection (1) , or varies or revokes an exemption under subsection (3) , ASIC must publish notice of the exemption, variation or revocation on ASIC ' s website.

Exemption of classes of clearing and settlement facilities and persons

791C(7)    
ASIC may, by legislative instrument, exempt:

(a)    a class of financial markets; or

(b)    a class of persons;

from all or specified provisions of this Part.

Note: The provisions of this Part include regulations made for the purposes of this Part: see section 761H .

791C(8)    
The exemption may apply:

(a)    unconditionally or subject to specified conditions; and

(b)    for a specified period or indefinitely (the exemption duration ).

791C(9)    
ASIC may, at any time, by legislative instrument:

(a)    vary an exemption given under subsection (7) to:

(i) impose conditions, or additional conditions, on the exemption; or

(ii) vary or revoke any of the conditions on the exemption; or

(iii) extend or shorten the exemption duration (including as affected by any variation from a previous operation of this subparagraph); or

(b)    revoke an exemption given under subsection (7) .

791C(10)    
However, ASIC may only take action under subsection (9) after:

(a)    giving notice, and an opportunity to make submissions on the proposed action, to:

(i) if paragraph (7)(a) applies to the exemption - the operator of each financial market known by ASIC to be covered by the exemption; or

(ii) if paragraph (7)(b) applies to the exemption - each person known by ASIC to be covered by the exemption; and

(b)    both:

(i) a notice has been published on ASIC ' s website allowing a reasonable period within which the operator of each financial market covered by the exemption, or each person covered by the exemption, (as applicable) may make submissions on the proposed action; and

(ii) that period has ended.

SECTION 791D   WHEN A FINANCIAL MARKET IS OPERATED IN THIS JURISDICTION  

791D(1)    

A financial market is taken to be operated in this jurisdiction if it:

(a)    is operated by a body corporate that is registered under Chapter 2A ; or

(b)    is covered by a declaration in force under subsection (2) .

Declarations

791D(2)    

ASIC may, by written notice given to a body corporate, declare that a financial market operated by the body corporate has a material connection with this jurisdiction.

Referrals to the Minister

791D(3)    
If, at any time after a body corporate receives a declaration under subsection (2) , the body corporate requests in writing that ASIC refer the declaration to the Minister, ASIC must do so immediately.

791D(4)    
The Minister may, if the Minister considers it appropriate after being referred the declaration, direct ASIC to vary or revoke the declaration.

791D(5)    
ASIC must comply with the direction given under subsection (4) immediately.

791D(6)    
A direction given under subsection (4) is not a legislative instrument.

SECTION 791E   CRITERIA FOR DECLARATIONS THAT FINANCIAL MARKETS HAVE A MATERIAL CONNECTION WITH THIS JURISDICTION  

791E(1)    
When ASIC is deciding under subsection 791D(2) whether to declare that a financial market has a material connection with this jurisdiction:

(a)    the market must have a connection with this jurisdiction (see subsection (2) of this section); and

(b)    ASIC must consider, under subsection (3) of this section, whether the connection is material.

Does the market have a connection with this jurisdiction?

791E(2)    
The financial market has a connection with this jurisdiction if one or more of the following paragraphs apply to the market:

(a)    the market has operations located in this jurisdiction;

(b)    the market provides a market for financial products:

(i) denominated in Australian currency; or

(ii) issued by a domestic corporation or by the Commonwealth, a State or a Territory;

(c)    the market provides a market for financial products based on something else (of any nature whatsoever and whether or not deliverable) located or issued in this jurisdiction, including, for example, one or more of the following:

(i) an asset;

(ii) a rate (including an interest rate or exchange rate);

(iii) an index;

(iv) a commodity;

(d)    one or more current or expected participants in the market are resident or based in this jurisdiction;

(e)    the market targets investors resident or based in this jurisdiction;

(f)    circumstances determined under paragraph (4)(a) exist in relation to the market.

If such a connection exists, is it material?

791E(3)    
The financial market ' s connection with this jurisdiction is material if ASIC considers that, after applying any principles in force under paragraph (4)(c) , either or both of the following paragraphs apply to the market:

(a)    the size and extent of current or expected aggregate activity in the market of participants in the market is material to:

(i) the risk management activities of those participants; or

(ii) the efficient allocation of capital or liquidity to the Australian economy; or

(iii) the provision of fair, orderly and transparent financial markets to those participants who are resident or based in this jurisdiction; or

(iv) confident and informed decision-making by consumers of financial products or financial services who are resident or based in this jurisdiction;

(b)    circumstances determined under paragraph (4)(b) exist in relation to the market.

Relevant ASIC determinations

791E(4)    
ASIC may by legislative instrument:

(a)    determine circumstances for the purposes of paragraph (2)(f) ; or

(b)    determine circumstances for the purposes of paragraph (3)(b) ; or

(c)    determine, for each paragraph of subsection (3) , principles for working out if that paragraph applies to a financial market.

Note: A single document could cover any or all of the things mentioned in paragraphs (a) to (c) .

ASIC may request related information

791E(5)    
ASIC may, by written notice given to a body corporate, request the body to give ASIC, within a period specified in the notice, information about a financial market operated by the body.

SECTION 791F   MINISTERIAL CONSENT TO ASIC DETERMINATION REQUIRED  

791F(1)    
ASIC must not make a determination under paragraph 791E(4)(b) unless the Minister has consented, in writing, to the making of the determination.

791F(2)    
A consent given under subsection (1) is not a legislative instrument.

SECTION 791G  

791G   REVOKING DECLARATIONS THAT FINANCIAL MARKETS HAVE A MATERIAL CONNECTION WITH THIS JURISDICTION  

ASIC may, by written notice given to a body corporate, revoke a declaration made under subsection 791D(2) about a financial market operated by the body corporate if:

(a)    after having regard to subsection 791E(2) , ASIC considers that the market does not have a connection with this jurisdiction; or

(b)    after having regard to subsection 791E(3) , ASIC no longer considers that the market ' s connection with this jurisdiction is material.

Division 3 - Regulation of market licensees  

Subdivision A - Licensee's obligations  

SECTION 792A   GENERAL OBLIGATIONS  

792A(1)    
A market licensee must:

(a)    to the extent that it is reasonably practicable to do so, do all things necessary to ensure that the market is a fair, orderly and transparent market; and

(b)    comply with the conditions on the licence; and

(c)    have adequate arrangements (which may involve the appointment of an independent person or related entity) for operating the market, including arrangements for:

(i) handling conflicts between the commercial interests of the licensee and the need for the licensee to ensure that the market operates in the way mentioned in paragraph (a); and

(ii) monitoring and enforcing compliance with the market ' s operating rules; and

(d)    have sufficient resources (including financial, technological and human resources) to operate the market properly; and

(e)    if section 881A requires there to be compensation arrangements in relation to the market that are approved in accordance with Division 3 of Part 7.5 - ensure that there are such approved compensation arrangements in relation to the market; and

(f)    if the licensee is a foreign body corporate - be registered under Division 2 of Part 5B.2 ; and

(g)    

if the licence was granted under subsection 795B(2) (overseas markets) - both:

(i) remain authorised to operate a financial market in the foreign country in which the licensee ' s principal place of business is located; and

(ii) get ASIC ' s approval under section 792H before that principal place of business becomes located in any other foreign country; and

(h)    

if the licensee, or a holding company of the licensee, is a widely held market body - take all reasonable steps to ensure that an unacceptable control situation does not exist in relation to the body; and

(i)    take all reasonable steps to ensure that no disqualified individual becomes, or remains, involved in the licensee (see Division 2 of Part 7.4 ).

792A(2)    

A person contravenes this subsection if the person contravenes paragraph (1)(a) , (c) , (d) , (e) , (f) , (g) , (h) or (i) .

Note: This subsection is a civil penalty provision (see section 1317E ).

SECTION 792B   OBLIGATION TO NOTIFY ASIC OF CERTAIN MATTERS  

792B(1)    

A market licensee must give written notice to ASIC, as soon as practicable, if it becomes aware that it may no longer be able to meet, or has breached, an obligation under section 792A .

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792B(2)    
A market licensee must give written notice to ASIC, as soon as practicable, as required by the following paragraphs:

(a)    if the licensee provides a new class of financial service incidental to the operation of the market, the licensee must give notice that includes details of the new class;

(b)    if the licensee takes any kind of disciplinary action against a participant in the market, the licensee must give notice that includes:

(i) the participant ' s name; and

(ii) the reason for and nature of the action taken;

(c)    if the licensee has reason to suspect that a person has committed, is committing, or is about to commit a significant contravention of the market ' s operating rules or this Act, the licensee must give notice that includes:

(i) the person ' s name; and

(ii) details of the contravention or impending contravention; and

(iii) the licensee ' s reasons for that belief.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792B(3)    
If a market licensee becomes aware of:

(a)    a matter that the licensee considers has adversely affected, is adversely affecting, or may adversely affect the ability of a participant in the market, who is a financial services licensee, to meet the participant ' s obligations as a financial services licensee; or

(b)    a matter, concerning a participant in the market who is a financial services licensee, that is of a kind prescribed by regulations made for the purposes of this paragraph;

the market licensee must give a written report to ASIC on the matter and send a copy of it to the participant.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792B(4)    
A market licensee whose licence was granted under subsection 795B(2) (overseas markets) must, as soon as practicable, give written notice to ASIC if:

(a)    the licensee ceases to be authorised to operate a financial market in the foreign country in which the licensee ' s principal place of business is located; or

(b)    there is a significant change to the regulatory regime applying in relation to the market in the foreign country in which the licensee ' s principal place of business is located.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792B(5)    
As soon as practicable after:

(a)    

a person becomes or ceases to be a director, secretary or senior manager of a market licensee or of a holding company of a market licensee (including when a person changes from one of those positions to another); or

(b)    

a market licensee becomes aware that a person has come to have, or has ceased to have, more than 20% of the voting power in the licensee or in a holding company of the licensee;

the licensee must give written notice of this to ASIC. The notice must include such other information about the matter as is prescribed by regulations made for the purposes of this subsection.

Note 1: To the extent that the licensee is required to give the notice and information under any other provision of this Act, the licensee may comply with this subsection by doing so. It need not provide the same information twice.

Note 2: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792B(7)    

A person contravenes this subsection if the person contravenes subsection (1) , (2) , (3) , (4) or (5) .

Note: This subsection is a civil penalty provision (see section 1317E ).

SECTION 792C   GIVING ASIC INFORMATION ABOUT A LISTED DISCLOSING ENTITY  

792C(1)    
If a market licensee makes information about a listed disclosing entity available to participants in the market (whether or not the licensee also makes the information available to anyone else), the licensee must give ASIC the same information as soon as practicable.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792C(2)    
However, the licensee is not required to give ASIC any information of a kind that is excluded by the regulations.

792C(3)    
ASIC may require the information to be given in a particular form.

SECTION 792D   OBLIGATION TO ASSIST ASIC  

792D(1)   [ Assistance to ASIC]  

A market licensee must give such assistance to ASIC, or a person authorised by ASIC, as ASIC or the authorised person reasonably requests in relation to the performance of ASIC's functions.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792D(2)   [ Type of assistance]  

Such assistance may include showing ASIC the licensee's books or giving ASIC other information.

SECTION 792E  

792E   OBLIGATION TO GIVE ASIC ACCESS TO MARKET FACILITIES  

A market licensee must give a person authorised by ASIC such reasonable access to the market's facilities as the person requests for any of the purposes of this Chapter.

Note: Failure to comply with this section is an offence (see subsection 1311(1) ).

SECTION 792F   ANNUAL REPORT  

792F(1)    
A market licensee must, within 3 months after the end of its financial year, give ASIC an annual report on the extent to which the licensee complied with its obligations as a market licensee under this Chapter.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792F(2)    
The licensee must ensure that the annual report is accompanied by any information and statements prescribed by regulations made for the purposes of this subsection.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792F(3)    

The licensee must also ensure that the annual report is accompanied by any audit report that ASIC requires under subsection (4).

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792F(4)    

ASIC may, by giving written notice to a market licensee, require the licensee to obtain from ASIC, or a suitably qualified person or body nominated by ASIC, an audit report on the annual report and on any information or statements accompanying it.

792F(5)    
(Repealed by No 87 of 2024, s 3, Sch 3 [ 4] (effective 24 September 2024).)

SECTION 792G   OBLIGATIONS TO NOTIFY PEOPLE ABOUT CLEARING AND SETTLEMENT ARRANGEMENTS IN CERTAIN CIRCUMSTANCES  

792G(1)   [ Notice of no CS facilities]  

If, in relation to a category of transactions, being all transactions or a class of transactions effected through a licensed market, the market licensee:

(a) does not have any clearing and settlement arrangements for transactions in that category; or

(b) has clearing and settlement arrangements for transactions in that category, but they are not arrangements with the operator of a clearing and settlement facility for the clearing and settlement of such transactions through the facility;

the market licensee must, before a person becomes a participant in the market, give the person written advice:

(c) if paragraph (a) applies - that the licensee does not have any clearing and settlement arrangements for transactions in that category, and that it is the responsibility of the parties to such transactions to make their own arrangements for the clearing and settlement of such transactions; or

(d) if paragraph (b) applies - setting out particulars of the clearing and settlement arrangements for transactions in that category.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

792G(2)   [ Notice of impending cessation]  

Within a reasonable time before a market licensee ceases, in relation to a category of transactions, being all transactions or a class of transactions effected through a licensed market, to have clearing and settlement arrangements (the terminating arrangements ) with the operator of a particular clearing and settlement facility for the clearing and settlement of such transactions through the facility, the market licensee must give the participants in the market written advice:

(a) if the terminating arrangements are not being replaced by any other clearing and settlement arrangements - that the licensee will no longer have clearing and settlement arrangements for that category of transactions, and that it will be the responsibility of the parties to such transactions to make their own arrangements for the clearing and settlement of such transactions; or

(b) if the terminating arrangements are being replaced by new clearing and settlement arrangements - setting out particulars of the new arrangements.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

SECTION 792H   CHANGE OF COUNTRY BY FOREIGN LICENSEE  

792H(1)    

In the case of a licence granted under subsection 795B(2) , ASIC may approve the location of the licensee's principal place of business in a new country only if:

(a)    the new country is not Australia; and

(b)    the operation of the market in that country will be subject to requirements and supervision that are sufficiently equivalent, in relation to the degree of investor protection and market integrity they achieve, to the requirements and supervision to which financial markets are subject under this Act in relation to those matters.

792H(2)    
If, in relation to a licence granted under subsection 795B(2) , the licensee's principal place of business changes to become a place in Australia:

(a)    the licence ceases to be in force from the time of the change; and

(b)    if the licensee wishes the market to continue to be licensed, the licensee may apply for the grant of a new licence under subsection 795B(1) ; and

(c)    the application must be assessed in accordance with Subdivision A of Division 4 , subject to such modifications (if any) of that Subdivision as are set out in regulations made for the purposes of this paragraph.

792H(3)    
An application referred to in paragraph (2)(b) may be made in advance of the change of location of the principal place of business, and a decision on the application may be made before that time. However, any licence granted pursuant to the application does not come into force until the change occurs.

SECTION 792I  

792I   MAKING INFORMATION ABOUT COMPENSATION ARRANGEMENTS PUBLICLY AVAILABLE  

A market licensee must take reasonable steps to ensure that information about the compensation arrangements that are in place under Part 7.5 is available to the public free of charge.

Note: Failure to comply with this section is an offence (see subsection 1311(1) ).

Subdivision B - The market's operating rules and procedures  

SECTION 793A   CONTENT OF THE OPERATING RULES AND PROCEDURES  

793A(1)   [ Operating rules of licensed market]  

The operating rules of a licensed market must deal with the matters prescribed by regulations made for the purposes of this subsection.

793A(2)   [ Written procedures]  

The regulations may also prescribe matters in respect of which a licensed market must have written procedures.

793A(3)   [ Exclusion]  

However, subsections (1) and (2) do not apply if the licensee is also authorised to operate the market in the foreign country in which its principal place of business is located and the licence was granted under subsection 795B(2) (overseas markets).

793A(4)   [ ASIC determination on exclusion]  

In a subsection (3) case, ASIC may determine, by giving written notice to the licensee, matters in respect of which the licensed market must have written procedures.

SECTION 793B   LEGAL EFFECT OF OPERATING RULES  

793B(1)    
The operating rules (other than listing rules) of a licensed market have effect as a contract under seal:

(a)    between the licensee and each participant in the market; and

(b)    between a participant and each other participant;

under which each of those persons agrees to observe the operating rules to the extent that they apply to the person and to engage in conduct that the person is required by the operating rules to engage in.

793B(2)    

However, if there is an inconsistency between the operating rules of a financial market, and any of the following other rules:

(a)    the market integrity rules;

(aa)    

the CS facility rules;

(b)    the derivative transaction rules;

(c)    the derivative trade repository rules;

(d)    

the client money reporting rules;

those other rules prevail over the operating rules to the extent of the inconsistency.

Note 1: If there is an inconsistency between the market integrity rules and the derivative transaction rules or the derivative trade repository rules, the market integrity rules prevail: see subsection 798H(3) .

Note 2: If there is an inconsistency between the derivative transaction rules and the derivative trade repository rules, the derivative transaction rules prevail: see subsection 901E(2) .

Note 3: If there is an inconsistency between the market integrity rules, the derivative transaction rules or the derivative trade repository rules and the client money reporting rules, the market integrity rules, the derivative transaction rules or the derivative trade repository rules prevail: see subsection 981M(2) .

793B(3)    
Subsection (2) does not apply in relation to a financial market the operator of which is licensed under subsection 795B(2) (overseas markets).

SECTION 793C   ENFORCEMENT OF OPERATING RULES  

793C(1)    
If a person who is under an obligation to comply with or enforce any of a licensed market ' s operating rules fails to meet that obligation, an application to the Court may be made by:

(a)    ASIC; or

(b)    the licensee; or

(c)    the operator of a clearing and settlement facility with which the licensee has clearing and settlement arrangements; or

(d)    a person aggrieved by the failure.

793C(2)    
After giving an opportunity to be heard to the applicant and the person against whom the order is sought, the Court may make an order giving directions to:

(a)    the person against whom the order is sought; or

(b)    

if that person is a body corporate (other than a notified foreign passport fund) - the directors of the body corporate;

about compliance with, or enforcement of, the operating rules.

793C(3)    
For the purposes of this section, a body corporate (other than a notified foreign passport fund) that is, with its agreement, consent or acquiescence, included in the official list of a licensed market, or an associate of such a body corporate, is taken to be under an obligation to comply with the operating rules of that market to the extent to which those rules purport to apply to the body corporate or associate.

793C(4)    
For the purposes of this section, if a disclosing entity that is an undertaking to which interests in a registered scheme relate is, with the responsible entity ' s agreement, consent or acquiescence, included in the official list of a licensed market, the responsible entity, or an associate of the responsible entity, is taken to be under an obligation to comply with the operating rules of that market to the extent to which those rules purport to apply to the responsible entity or associate.

793C(4A)    

For the purposes of this section, if a disclosing entity that is an undertaking to which interests in a notified foreign passport fund relate is, with the agreement, consent or acquiescence of the operator of the fund, included in the official list of a licensed market, the operator of the fund, or an associate of the operator, is taken to be under an obligation to comply with the operating rules of that market to the extent to which those rules purport to apply to the operator or associate.

793C(4B)    

For the purposes of this section, if:

(a)    subsection (3) does not apply to a CCIV; and

(b)    a sub-fund of the CCIV is, with the agreement, consent or acquiescence of the CCIV, included in the official list of a licensed market;

the CCIV, or an associate of the CCIV, is taken to be under an obligation to comply with the operating rules of that market to the extent to which those rules purport to apply to the CCIV or associate.

Note: Subsection (3) may apply to a CCIV instead of this subsection if the CCIV, and not a sub-fund, is included in the official list of a licensed market.

793C(5)    
For the purposes of this section, if a body corporate fails to comply with or enforce provisions of the operating rules of a licensed market, a person who holds financial products of the body corporate that are able to be traded on the market is taken to be a person aggrieved by the failure.

793C(6)    
There may be other circumstances in which a person may be aggrieved by a failure for the purposes of this section.

SECTION 793D   CHANGING THE OPERATING RULES  

Licensed markets other than subsection 795B(2) markets

793D(1)    

As soon as practicable after a change is made to the operating rules of a licensed market, other than a market licensed under subsection 795B(2) (overseas markets), the licensee must lodge with ASIC in a prescribed form written notice of the change. The notice must:

(a)    set out the text of the change; and

(b)    specify the date on which the change was made; and

(c)    contain an explanation of the purpose of the change.

793D(2)    
If no notice is lodged as required by subsection (1) with ASIC within 21 days after the change is made, the change ceases to have effect at the end of that period.

Subsection 795B(2) markets

793D(3)    

As soon as practicable after a change is made to the operating rules of a market the operation of which is licensed under subsection 795B(2) (overseas markets), the licensee must lodge with ASIC in a prescribed form written notice of the change. The notice must:

(a)    set out the text of the change; and

(b)    specify the date on which the change was made; and

(c)    contain an explanation of the purpose of the change.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

SECTION 793E   DISALLOWANCE OF CHANGES TO OPERATING RULES  

793E(1)    
This section does not apply in respect of an Australian market licence granted under subsection 795B(2) (overseas markets).

793E(2)    
(Repealed by No 87 of 2024, s 3, Sch 3[6] (effective 24 September 2024).)

793E(3)    

Within 28 days after ASIC receives a notice under section 793D from a market licensee, ASIC may disallow all or a specified part of the change to the operating rules.

793E(4)    

In deciding whether to do so, ASIC must have regard to the consistency of the change with the licensee ' s obligations under this Part (including in particular the obligation mentioned in paragraph 792A(1)(a) ).

Note: ASIC must also have regard to the matters in section 798A .

793E(5)    
As soon as practicable after all or a part of a change is disallowed, ASIC must give notice of the disallowance to the licensee. The change ceases to have effect, to the extent of the disallowance, when the licensee receives the notice.

Subdivision C - Powers of ASIC  

SECTION 794A   ASIC ' S DIRECTIONS POWER - PROMOTING COMPLIANCE  

794A(1)    

If ASIC considers that a market licensee is not complying or is not likely to comply with its obligations as a market licensee under this Chapter, ASIC may give the licensee a written direction:

(a)    to do specified things that ASIC believes will promote compliance by the licensee with those obligations; or

(b)    to refrain from doing specified things, if ASIC believes that refraining from doing those things will promote compliance by the licensee with those obligations.

794A(2)    
The licensee must comply with the direction.

794A(3)    
If the licensee fails to comply with the direction, ASIC may apply to the Court for, and the Court may make, an order that the licensee comply with the direction.

794A(4)    

ASIC may vary or revoke a direction at any time by giving written notice to the licensee.

794A(5)    

If, at any time after the licensee receives a direction, the licensee requests in writing that ASIC refer the matter to the Minister, ASIC must do so immediately.

794A(6)    

The Minister may, if the Minister considers it appropriate after being referred the matter, direct ASIC to vary or revoke the direction.

794A(7)    

ASIC must comply with the direction given under subsection (6) immediately.

794A(8)    

A direction under subsection (6) is not a legislative instrument.

SECTION 794AA   ASIC ' S DIRECTIONS POWER - CRISIS RESOLUTION  

794AA(1)    
If the Reserve Bank, under subsection 849AB(1) , requests ASIC to give a direction to a market licensee under this subsection to do, or to refrain from doing, specified things, ASIC may give the licensee a written direction to do, or to refrain from doing, those things.

794AA(2)    
Without limiting subsection (1) , the specified things may include:

(a)    suspending dealings in a specified financial product or class of financial products; or

(b)    taking:

(i) any actions; or

(ii) one or more specified actions;

relating to dealings in a specified financial product or class of financial products.

Example: Under paragraph (b), a direction could require the licensee to take actions to:

(a) limit the kinds of dealings that are allowed in a financial product or class of financial products; or

(b) require participants in a market to act in a specified manner in relation to dealings in a financial product or class of financial products.

794AA(3)    
The direction must specify a reasonable time by which, or a reasonable period during which, it is to be complied with.

794AA(4)    
The licensee must comply with the direction.

Note: Failure to comply with this subsection is an offence: see subsection 1311(1) .

794AA(5)    
If the licensee fails to comply with the direction, ASIC may apply to the Court for, and the Court may make, an order that the licensee comply with the direction.

SECTION 794AB   MATTERS RELATING TO ASIC DIRECTIONS - CRISIS RESOLUTION  

Variation or revocation

794AB(1)    
If the Reserve Bank, under subsection 849AB(1) , requests ASIC to vary a direction given to a market licensee under subsection 794AA(1) , ASIC may vary the direction by giving written notice to the licensee.

794AB(2)    
ASIC may revoke a direction given to a market licensee under subsection 794AA(1) by giving written notice to the licensee.

Notifying other affected persons

794AB(3)    
As soon as practicable after:

(a)    directing a market licensee under subsection 794AA(1) to do a thing mentioned in subsection 794AA(2) ; or

(b)    varying or revoking such a direction;

ASIC must give written notice of the direction, variation or revocation to the operator of each clearing and settlement facility with which the market licensee has clearing and settlement arrangements for transactions effected through the market.

Directions are not legislative instruments

794AB(4)    
A direction given under subsection 794AA(1) , a variation under subsection (1) of this section, or a revocation under subsection (2) of this section is not a legislative instrument.

SECTION 794B   ASIC ' S POWER TO REQUIRE SPECIAL REPORT  

794B(1)    
ASIC may give a market licensee a written notice requiring the licensee to give ASIC a special report on specified matters.

794B(2)    
The licensee must give the special report to ASIC within the time required by the notice.

Note: Failure to comply with this subsection is an offence: see subsection 1311(1) .

SECTION 794BA   ASIC ' S POWER TO REQUIRE EXPERT REPORT  

Expert appointed by ASIC

794BA(1)    
ASIC may, by written notice given to a market licensee and a person (the expert ), appoint the expert to provide ASIC with an expert report on specified matters relating to the licensee ' s compliance with its obligations as a market licensee under this Chapter.

794BA(2)    
ASIC may, by written notice given to the licensee, direct the licensee to reimburse ASIC for ASIC ' s expenses that:

(a)    are incurred in appointing and paying the expert to provide the report; and

(b)    are specified in the notice.

Expert appointed by licensee

794BA(3)    
ASIC may, by written notice given to a market licensee, direct the licensee to appoint a person to provide ASIC with an expert report on specified matters relating to the licensee ' s compliance with its obligations as a market licensee under this Chapter.

Qualifications for appointment

794BA(4)    
However, a person cannot be appointed under subsection (1) or (3) unless ASIC:

(a)    is satisfied that the person has the necessary skills or experience to provide the expert report; and

(b)    if subsection (3) applies - has approved the proposed appointment of the person.

Licensee ' s obligations

794BA(5)    
The licensee must give all information, explanation and assistance to a person appointed under subsection (1) or (3) as the person reasonably requests for the preparation and provision of the expert report.

Note: Failure to comply with this subsection is an offence: see subsection 1311(1) .

794BA(6)    
If, under subsection (2) , ASIC directs the licensee to reimburse ASIC for ASIC ' s expenses, an amount equal to those expenses:

(a)    is a debt due and payable to ASIC; and

(b)    is recoverable by ASIC in:

(i) the Federal Court; or

(ii) the Federal Circuit and Family Court of Australia (Division 2); or

(iii) a court of a State or Territory that has jurisdiction in relation to the matter.

794BA(7)    
The licensee must comply with any direction given under subsection (3) to the licensee.

Note: Failure to comply with this subsection is an offence: see subsection 1311(1) .

SECTION 794C   ASIC ASSESSMENT OF LICENSEE ' S COMPLIANCE  

794C(1)    
ASIC may do an assessment of how well a market licensee is complying with any or all of its obligations as a market licensee under this Chapter. In doing the assessment, ASIC may take account of any information and reports that it thinks appropriate, including information and reports from an overseas regulatory authority.

794C(2)    

If the market licensee is prescribed by the regulations for the purpose of this subsection, ASIC must, in respect of the obligation in paragraph 792A(1)(c) , do such an assessment at least once a year.

794C(3)    

As soon as practicable after doing an assessment under this section, ASIC must give a written report on the assessment to the licensee.

794C(4)    
If an assessment, or part of an assessment, relates to any other person ' s affairs to a material extent, ASIC may, at the person ' s request or of its own motion, give the person a copy of the written report on the assessment or the relevant part of the report.

794C(5)    
If an assessment, or part of an assessment, relates to a serious contravention of a law of the Commonwealth or of a State or Territory, ASIC may give a copy of the written report on the assessment, or the relevant part of the report, to:

(a)    the Australian Federal Police; or

(b)    

the Chief Executive Officer of the Australian Crime Commission or a member of the staff of the ACC (within the meaning of the Australian Crime Commission Act 2002 ); or

(c)    the Director of Public Prosecutions; or

(d)    an agency prescribed by regulations made for the purposes of this paragraph.

794C(6)    

ASIC may cause the written report on an assessment, or part of the report on an assessment, to be published.

SECTION 794D   ASIC ' S DIRECTIONS POWER - PROTECTING DEALINGS IN FINANCIAL PRODUCTS  

794D(1)    
ASIC may, by written notice given to a market licensee, direct the licensee:

(a)    to suspend dealings in a specified financial product or class of financial products; or

(b)    to take, or refrain from taking:

(i) any actions; or

(ii) one or more specified actions;

relating to dealings in a specified financial product or class of financial products;

if ASIC considers the direction is necessary, or in the public interest, to protect people dealing in the financial product or class of financial products.

Example:

Under paragraph (b) , a direction could require the licensee to take actions to:

(a) limit the kinds of dealings that are allowed in the financial product or class of financial products; or

(b) require participants in the market to act in a specified manner in relation to dealings in the financial product or class of financial products.

794D(2)    
The direction:

(a)    must specify a reasonable time by which, or a reasonable period during which, it is to be complied with; and

(b)    must include the reasons for the direction; and

(c)    may deal with either or both of the matters in paragraphs (1)(a) and (b) .

794D(3)    
The licensee must comply with the direction (even if, under subsection 794DA(1) , the licensee has requested ASIC to refer the direction to the Minister).

Note: Failure to comply with this subsection is an offence: see subsection 1311(1) .

794D(4)    
If the licensee fails to comply with the direction, ASIC may apply to the Court for, and the Court may make, an order that the licensee comply with the direction.

SECTION 794DA   MATTERS RELATING TO ASIC DIRECTIONS - PROTECTING DEALINGS IN FINANCIAL PRODUCTS  

Referrals to the Minister

794DA(1)    
If, at any time after a market licensee receives a direction under subsection 794D(1) , the licensee requests in writing that ASIC refer the direction to the Minister, ASIC must do so immediately.

794DA(2)    
The Minister may, if the Minister considers it appropriate after being referred the direction, direct ASIC to vary or revoke the direction.

794DA(3)    
ASIC must comply with the direction given under subsection (2) immediately.

794DA(4)    
A direction given under subsection (2) is not a legislative instrument.

Variations and revocations

794DA(5)    
ASIC may vary or revoke a direction given under subsection 794D(1) :

(a)    in like manner; and

(b)    subject to like conditions, except if a condition is contrary to a direction given under subsection (2) of this section;

(see subsection 33(3) of the Acts Interpretation Act 1901 ).

Notifying other affected persons

794DA(6)    
As soon as practicable after:

(a)    giving a direction under subsection 794D(1) to a market licensee; or

(b)    varying or revoking such a direction;

ASIC must give written notice of the direction, variation or revocation to the operator of each clearing and settlement facility with which the market licensee has clearing and settlement arrangements for transactions effected through the market.

Directions are not legislative instruments

794DA(7)    
A direction given under subsection 794D(1) is not a legislative instrument.

SECTION 794E   ADDITIONAL DIRECTIONS TO CLEARING AND SETTLEMENT FACILITIES  

794E(1)   [ Power to give directions to CS facility operator]  

If ASIC gives a direction under section 794D , it may also give a written direction to the operator of each clearing and settlement facility with which the market licensee has clearing and settlement arrangements for transactions effected through the market:

(a) prohibiting the operator from acting in a manner inconsistent with the section 794D direction; and

(b) requiring the operator to do all that the operator is reasonably capable of doing to give effect to the section 794D direction.

794E(2)   [ Compliance with direction]  

The operator must comply with the direction given to it under this section.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

794E(3)   [ Enforcement of direction]  

If the operator fails to comply with the direction, ASIC may apply to the Court for, and the Court may make, an order that the operator comply with the direction.

Division 4 - The Australian market licence  

Subdivision A - How to get a licence  

SECTION 795A  

795A   HOW TO APPLY FOR A LICENCE  

A body corporate may apply for an Australian market licence by lodging with ASIC in a prescribed form an application that:

(a)    includes the information required by regulations made for the purposes of this paragraph; and

(b)    is accompanied by the documents (if any) required by regulations made for the purposes of this paragraph; and

(c)    complies with the requirements of section 881B (relating to compensation arrangements).

Note: For fees in respect of lodging applications, see Part 9.10 .

SECTION 795B   WHEN A LICENCE MAY BE GRANTED  

General

795B(1)    

ASIC may grant an applicant an Australian market licence if ASIC is satisfied that:

(a)    the application was made in accordance with section 795A ; and

(b)    the applicant will comply with the obligations that will apply if the licence is granted; and

(c)    

the applicant has adequate operating rules, and procedures, (see Subdivision B of Division 3 ) to ensure, as far as is reasonably practicable, that the market will operate as mentioned in paragraph 792A(1)(a) ; and

(d)    

the applicant has adequate arrangements (which may involve the appointment of an independent person or related entity) for operating the market, including arrangements for:

(i) handling conflicts between the commercial interests of the licensee and the need for the licensee to ensure that the market operates in the way mentioned in paragraph 792A(1)(a) ; and

(ii) monitoring and enforcing compliance with the market ' s operating rules; and

(e)    the applicant has adequate clearing and settlement arrangements for transactions effected through the market, if ASIC considers that the applicant should have such arrangements; and

(f)    neither subsection 881D(2) nor 882A(2) (relating to compensation arrangements) requires ASIC to reject the application; and

(g)    no unacceptable control situation (see Division 1 of Part 7.4 ) is likely to result if the licence is granted; and

(h)    no disqualified individual appears to be involved in the applicant (see Division 2 of Part 7.4 ).

This subsection has effect subject to subsection (3) .

Note: ASIC must also have regard to the matters in section 798A in deciding whether to grant a licence.

Alternative criteria for granting licence for overseas market

795B(2)    

If an applicant is authorised to operate a financial market in the foreign country in which its principal place of business is located, ASIC may grant the applicant an Australian market licence authorising the applicant to operate the same market in this jurisdiction. ASIC must be satisfied that:

(a)    the application was made in accordance with section 795A ; and

(b)    the applicant will comply with the obligations that will apply if the licence is granted; and

(c)    the operation of the market in that country is subject to requirements and supervision that are sufficiently equivalent, in relation to the degree of investor protection and market integrity they achieve, to the requirements and supervision to which financial markets are subject under this Act in relation to those matters; and

(d)    the applicant undertakes to cooperate with ASIC by sharing information and in other appropriate ways; and

(e)    no unacceptable control situation (see Division 1 of Part 7.4 ) is likely to result if the licence is granted; and

(f)    no disqualified individual appears to be involved in the applicant (see Division 2 of Part 7.4 ); and

(g)    any other requirements that are prescribed by regulations made for the purposes of this paragraph are satisfied.

This subsection has effect subject to subsection (3) .

Note: ASIC must also have regard to the matters in section 798A in deciding whether to grant a licence.

Foreign bodies

795B(3)    

If the applicant is a foreign body corporate, ASIC:

(a)    must not grant the applicant a licence unless the applicant is registered under Division 2 of Part 5B.2 ; and

(b)    may otherwise grant a licence under either subsection (1) or (2) (if the relevant criteria are satisfied).

795B(4)    
(Repealed by No 87 of 2024, s 3, Sch 2[12] (effective 24 September 2024).)

SECTION 795C  

795C   PUBLICATION OF NOTICE OF LICENCE GRANT  

If ASIC grants an Australian market licence, ASIC must publish a notice on ASIC ' s website that includes:

(a)    the name of the licensee; and

(b)    when the licence was granted; and

(c)    the conditions on the licence.

SECTION 795D  

795D   MORE THAN ONE LICENCE IN THE SAME DOCUMENT  

If ASIC grants a person 2 or more of the following:

(a)    an Australian market licence;

(b)    an Australian CS facility licence;

they may be included in the same document.

SECTION 795E   MORE THAN ONE MARKET COVERED BY THE SAME LICENCE  

795E(1)    
The same Australian market licence may authorise the licensee to operate 2 or more financial markets.

795E(2)    

In that case, a reference to the market to which an Australian market licence relates is taken instead to be a reference to each of those financial markets severally.

795E(3)    

Before varying the conditions on an Australian market licence so as to add another market that the licensee is authorised to operate, ASIC must be satisfied of the matters listed in subsection 795B(1) or (2) (as appropriate) in relation to the market.

795E(4)    
An Australian market licence that authorises the licensee to operate 2 or more financial markets may be suspended or cancelled under Subdivision C in respect of one or some of those markets only, as if the licensee held a separate licence for each of the markets.

Subdivision B - The conditions on the licence  

SECTION 796A   THE CONDITIONS ON THE LICENCE  

796A(1)    

ASIC may, at any time:

(a)    impose conditions, or additional conditions, on an Australian market licence; or

(b)    vary or revoke conditions imposed on such a licence;

by giving written notice to the licensee. ASIC must also publish a notice on ASIC ' s website with details of the action and when it took effect.

Note: As well as the requirements in this section, ASIC must also have regard to the matters in section 798A .

796A(2)    

ASIC may do so:

(a)    

on ASIC ' s own initiative, subject to subsection (3) ; or

(b)    

if the licensee lodges with ASIC in a prescribed form an application for ASIC to do so, which is accompanied by the prescribed documents, if any.

Note: For fees in respect of lodging applications, see Part 9.10 .

796A(3)    

ASIC may only impose conditions or additional conditions, or vary the conditions, on the licence on ASIC ' s own initiative if:

(a)    

ASIC considers it appropriate to do so having regard to:

(i) the licensee's obligations as a market licensee under this Chapter; and

(ii) any change in market operations or the conditions in which the market is operating; and

(b)    

ASIC gives the licensee written notice of the proposed action and an opportunity to make a submission before it takes effect.

This subsection does not apply to ASIC imposing conditions when a licence is granted.

796A(4)    

ASIC must ensure that each Australian market licence is subject to conditions that specify:

(a)    the particular market that the licensee is authorised to operate; and

(b)    the class or classes of financial products that can be dealt with on the market; and

(c)    

if ASIC considers that the licensee should have clearing and settlement arrangements for transactions effected through the market - the type of clearing and settlement arrangements that are adequate.

Note: If compensation arrangements in relation to the market are approved under Division 3 of Part 7.5 , there must also be conditions as required by subsection 882A(4) or paragraph 882B(4)(b) .

796A(6)    
(Repealed by No 87 of 2024, s 3, Sch 3[44] (effective 24 September 2024).)

Subdivision C - When a licence can be varied, suspended or cancelled  

SECTION 797A   VARYING LICENCES  

797A(1)    

ASIC may vary an Australian market licence to take account of a change in the licensee ' s name if the licensee lodges with ASIC in a prescribed form an application for the variation, accompanied by the prescribed documents, if any.

Note 1: The conditions on the licence can be varied under section 796A .

Note 2: For fees in respect of lodging applications, see Part 9.10 .

797A(2)    

ASIC must give written notice of the variation to the licensee.

797A(3)    
(Repealed by No 87 of 2024, s 3, Sch 3[46] (effective 24 September 2024).)

SECTION 797B  

797B   IMMEDIATE SUSPENSION OR CANCELLATION  

ASIC may, by giving written notice to a market licensee, suspend the licence for a specified period, or cancel it, if:

(a)    

the licensee ceases to carry on the business of operating the financial market to which the licence relates; or

(aa)    

both of the following subparagraphs apply:

(i) it has been at least 12 months since ASIC granted the licence;

(ii) during the last 12 months, there has been no acceptance of any offers made through the market to acquire or dispose of financial products; or

(ab)    

all of the following subparagraphs apply:

(i) it has been at least 12 months since ASIC granted the licence;

(ii) the licence is subject to a condition specifying that the licensee is authorised to engage in specified conduct or activity that constitutes operating the market;

(iii) during the last 12 months, the licensee has not engaged in any such specified conduct or activity; or

(b)    

the licensee becomes a Chapter 5 body corporate; or

(c)    

the licensee asks ASIC to do so; or

(ca)    

an application has been made under section 601AA to deregister the licensee as a company; or

(cb)    

ASIC has decided under section 601AB to deregister the licensee as a company; or

(d)    

in the case of a licence granted under subsection 795B(2) (overseas markets):

(i) the licensee ceases to be authorised to operate a financial market in the foreign country in which the licensee ' s principal place of business is located; or

(ii) there is a change to the regulatory regime applying in relation to the financial market to which the licence relates in that country and, because of that change, ASIC is no longer satisfied of the matters in paragraph 795B(2)(c) ; or

(iii) the cooperation (including information sharing) between ASIC and the authority or authorities responsible for supervising the operation of that market in that country has materially deteriorated or is otherwise inadequate; or

(e)    

in the case of a licensee that is a leviable entity (within the meaning of the ASIC Supervisory Cost Recovery Levy Act 2017 ) - the following have not been paid in full at least 12 months after the due date for payment:

(i) an amount of levy (if any) payable in respect of the licensee;

(ii) an amount of late payment penalty payable (if any) in relation to the levy;

(iii) an amount of shortfall penalty payable (if any) in relation to the levy.

SECTION 797C   SUSPENSION OR CANCELLATION FOLLOWING HEARING AND REPORT  

797C(1)    

If ASIC considers that a market licensee has breached, or is in breach of, one or more of its obligations as a market licensee under this Chapter, ASIC may give the licensee a written notice that requires the licensee to show cause, at a hearing before a specified person, why the licence should not be suspended or cancelled.

797C(2)    
The notice must specify:

(a)    the grounds on which it is proposed to suspend or cancel the licence; and

(b)    a reasonable time and place at which the hearing is to be held.

However, if the licensee consents, the person conducting the hearing may fix a different time or place.

797C(3)    
The person conducting the hearing must:

(a)    give the licensee an opportunity to be heard at the hearing; and

(b)    

give ASIC:

(i) a report about the hearing; and

(ii) a recommendation about the grounds in the notice on which it is proposed to suspend or cancel the licence.

797C(4)    

After considering the report and recommendation, ASIC may:

(a)    decide to take no further action in relation to the matter and give written advice of that decision to the licensee; or

(b)    suspend the licence for a specified period, or cancel the licence, by giving written notice to the licensee.

Note: ASIC must also have regard to the matters in section 798A .

SECTION 797D   EFFECT OF SUSPENSION  

797D(1)    
A person whose Australian market licence is suspended is taken not to hold that licence while it is suspended.

797D(2)    

However, ASIC may specify in the written notice to the licensee that subsection (1) does not apply for specified purposes.

SECTION 797E  

797E   VARIATION OR REVOCATION OF SUSPENSION  

ASIC may at any time vary or revoke a suspension of an Australian market licence by giving written notice to the licensee.

SECTION 797F   PUBLICATION OF NOTICE OF LICENCE SUSPENSION OR CANCELLATION  

797F(1)    

If ASIC:

(a)    suspends, or varies or revokes a suspension of, an Australian market licence; or

(b)    cancels an Australian market licence;

ASIC must publish a notice on ASIC ' s website to that effect.

797F(2)    
The notice must state when the action took effect.

SECTION 797G  

797G   SUSPENSION AND CANCELLATION ONLY IN ACCORDANCE WITH THIS SUBDIVISION  

An Australian market licence cannot be varied, suspended or cancelled otherwise than in accordance with this Subdivision.

Note: The conditions on the licence can be varied under section 796A .

Division 5 - Other matters  

SECTION 798A   MATTERS TO BE TAKEN INTO ACCOUNTBY ASIC  

798A(1)    

ASIC must have regard to certain matters in deciding whether to:

(a)    grant an applicant an Australian market licence under section 795B ; or

(b)    impose, vary or revoke conditions on such a licence under section 796A ; or

(c)    suspend or cancel such a licence under section 797C ; or

(d)    disallow a change to the operating rules of a licensed market under section 793E .

798A(2)    

These are the matters ASIC must have regard to:

(a)    the structure, or proposed structure, of the market;

(b)    the nature of the activities conducted, or proposed to be conducted, on the market;

(c)    the size, or proposed size, of the market;

(d)    the nature of the financial products dealt with, or proposed to be dealt with, on the market;

(e)    the participants, or proposed participants, in the market and:

(i) whether those participants, in effecting transactions through the market, are, or will be, providing financial services to other persons; and

(ii) whether those participants acquire or dispose, or will acquire or dispose, of financial products through the market as retail clients or as wholesale clients; and

(iii) whether those participants are also, or will also be, participants in any other financial markets;

(f)    the technology used, or proposed to be used, in the operation of the market;

(g)    whether it would be in the public interest to take the action referred to in subsection (1) ;

(h) (Repealed)

ASIC may also have regard to any other matter that ASIC considers relevant.

798A(3)    

If ASIC is deciding whether to take the action referred to in paragraph (1)(a) , (b) or (c) in respect of an Australian market licence granted under subsection 795B(2) (overseas markets), ASIC must also have regard to:

(a)    the criteria that the licensee or applicant satisfied to obtain an authorisation to operate the same market in the foreign country in which their principal place of business is located; and

(b)    the obligations they must continue to satisfy to keep the authorisation; and

(c)    the level of supervision to which the operation of the market in that country is subject; and

(d)    whether adequate arrangements exist for cooperation between ASIC and the authority that is responsible for that supervision.

SECTION 798B  

798B   ASIC MAY GIVE ADVICE TO MINISTER  

ASIC may give advice to the Minister in relation to:

(a)    any matter in respect of which the Minister has a discretion under this Part; or

(b)    any other matter concerning financial markets.

SECTION 798C   MARKET LICENSEE OR RELATED BODY CORPORATE ETC. LISTING ON MARKET  

798C(1)    

Any of the following kinds of entity, scheme or fund (the listed entity ) may be included in a market ' s official list:

(a) the market licensee for the market;

(b) a related body corporate of the market licensee;

(c) a registered scheme whose responsible entity is a related body corporate of the market licensee;

(ca) a notified foreign passport fund whose operator is a related body corporate of the market licensee;

(d) a trust whose trustee is a related body corporate of the market licensee.

Note: There are certain matters that must be included in the market ' s listing rules before such an entity, scheme or fund is included in the official list (see subsection (4)).

798C(2)    
In such a case, the financial products of the listed entity may be traded on the market, if either or both the listed entity and the market licensee have entered into such arrangements as ASIC requires:

(a) for dealing with possible conflicts of interest that might arise from the listed entity ' s financial products being able to be traded on the market; and

(b) for the purposes of ensuring the integrity of trading in the listed entity ' s financial products.

Note: For fees in respect of ASIC performing functions under such arrangements, see Part 9.10 .

798C(3)    
The listed entity, and the market licensee (if applicable), with whom ASIC has entered into arrangements for the purposes of subsection (2) must comply with the arrangements.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

798C(4)    
Before, and at all times while, the listed entity is included in the market ' s official list, the market ' s listing rules must provide for ASIC, instead of the market licensee, to make decisions and to take action (or to require the market licensee to take action on ASIC ' s behalf) in relation to these matters, and matters related to these matters:

(a) the admission of the listed entity to the market ' s official list; and

(b) the removal of the listed entity from that list; and

(c) allowing, stopping or suspending the trading on the market of the listed entity ' s financial products.

Note: For fees in respect of ASIC performing this function, see Part 9.10 .

798C(5)    
ASIC has the powers and functions that are provided for it in any listing rules or arrangements made for the purposes of this section.

798C(6)    

The products of an entity, scheme or fund referred to in subsection (1) must not be traded on the market licensee ' s market otherwise than as allowed by this section.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

798C(7)    
This section does not apply if the licence of the market licensee was granted under subsection 795B(2) (overseas markets). Instead, the law of the country in which the market licensee ' s principal place of business is located applies for all purposes connected with the inclusion of the listed entity in the market ' s official list.

SECTION 798D   EXEMPTIONS AND MODIFICATIONS FOR SELF-LISTING LICENSEES OR RELATED BODIES CORPORATE ETC.  

798D(1)    
ASIC may:

(a) exempt an entity, scheme or fund referred to in subsection 798C(1) whose financial products are able to be traded on the market from a modifiable provision (see subsection (7)); or

(b) declare that a modifiable provision applies to an entity, scheme or fund referred to in subsection 798C(1) whose financial products are able to be traded on the market as if specified provisions were omitted, modified or varied as specified in the declaration.

798D(2)    
An exemption or declaration must be in writing and ASIC must publish notice of it in the Gazette .

798D(3)    
An exemption may apply unconditionally or subject to specified conditions.

798D(4)    

If an exemption is granted subject to specified conditions, the entity, scheme or fund must comply with those conditions.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

798D(5)    

If an exemption is granted subject to specified conditions, the Court may, on ASIC's application, order the entity, scheme or fund to comply with one or more of those conditions in a specified way.

798D(6)    
If conduct (including an omission) of a person would not have constituted an offence if:

(a) a particular condition had not been imposed on an exemption under paragraph (1)(a); or

(b) a particular declaration under paragraph (1)(b) had not been made;

that conduct does not constitute an offence unless, before the conduct occurred (in addition to complying with the gazettal requirement of subsection (2)), ASIC gave written notice setting out the text of the condition or the declaration to the person. In a prosecution for an offence to which this subsection applies, the prosecution must prove that this additional notification requirement was complied with before the conduct occurred.

798D(7)    
In this section:

modifiable provision
means:

(a) section 205G and any of the provisions of Chapter 6 , 6A , 6B , 6C , 6CA or 7 ; or

(b) regulations made for the purposes of that section or any of those provisions.

SECTION 798DA   MARKET LICENSEE, RELATED BODY CORPORATE ETC. OR COMPETITOR PARTICIPATING IN MARKET  

798DA(1)   [ Application]  

This section applies if any of the following is a participant (the participant ) in a market:

(a) the market licensee;

(b) a related body corporate of the market licensee;

(c) a partnership if a partner in the partnership is a related entity of the market licensee;

(d) an entity if:

(i) the entity conducts, or participates in, a business that is in competition with a business conducted by the market licensee, or by a related body corporate of the market licensee; and

(ii) the entity requests that ASIC make decisions and take action in relation to the matters referred to in subsection (2).

798DA(2)   [ Regulation of participant]  

Before, and at all times while, the participant is participating in the market, the market ' s operating rules must provide for ASIC, instead of the market licensee, to make decisions and to take action (or to require the market licensee to take action on ASIC ' s behalf) in relation to these matters, and matters related to these matters:

(a) the admission of the participant to the market; and

(b) the expulsion and suspension of the participant from the market; and

(c) the disciplining of the participant; and

(d) the participant ' s compliance with the operating rules or this Act, including:

(i) the method of determining whether the participant has complied with those rules or this Act; and

(ii) any action (including the imposition of a fine or penalty) to be taken in respect of contraventions of those rules or this Act.

Note: For fees in respect of ASIC performing this function, see Part 9.10 .

798DA(3)   [ Powers and functions of ASIC]  

ASIC has the powers and functions that are provided for it in any operating rules made for the purposes of this section.

798DA(4)   [ Prohibition on market licensee]  

A participant referred to in subsection (1) must not participate in the market licensee ' s market otherwise than as allowed by this section.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1) ).

798DA(5)   [ Limitation on application]  

This section does not apply if the licence of the market licensee was granted under subsection 795B(2) (overseas markets). Instead, the law of the country in which the market licensee ' s principal place of business is located applies for all purposes connected with the participation of the participant in the market.

798DA(6)   [ Prohibition on participation in own market]  

To avoid doubt, subsection (1) does not authorise a market licensee to participate in its own market.

SECTION 798E   OTHER POTENTIAL CONFLICT SITUATIONS  

798E(1)    

The regulations may make provision in relation to the rules and procedures that are to apply in the case of conflicts, or potential conflicts, between the commercial interests of the licensee and the need for the licensee to ensure that the market operates in the way mentioned in paragraph 792A(1)(a) .

798E(2)    
In particular, such regulations may deal with the following:

(a) identifying when such a conflict, or potential conflict, is taken to arise;

(b) empowering ASIC, instead of the licensee, to make decisions and to take action under the market ' s operating rules in relation to such a conflict or potential conflict;

(c) empowering ASIC to require the licensee to take action under the market ' s operating rules (whether or not on ASIC ' s behalf) in relation to such a conflict or potential conflict.

Note:For fees in respect of ASIC performing this function, see Part 9.10 .

798E(3)    
Subsection (2) does not limit the generality of subsection (1).