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Rules/Other as made
This instrument amends the ASIC Market Integrity Rules (Securities Markets) 2017 to vary prohibition on payment for order flow in Part 5.4B to close a regulatory gap in the current rules.
Administered by: Treasury
Registered 09 Mar 2022
Tabling HistoryDate
Tabled Senate28-Mar-2022
Tabled HR29-Mar-2022
Table of contents.

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ASIC Market Integrity Rules (Securities Markets) Amendment 2022/73

I, Calissa Aldridge, delegate of the Australian Securities and Investments Commission, make the following legislative instrument.

 

Date 9 March 2022

 

 

 

Calissa Aldridge

 



Part 1—Preliminary

1        Name of legislative instrument

This is the ASIC Market Integrity Rules (Securities Markets) Amendment 2022/73.

2        Commencement

This instrument commences 3 months after the day it is registered on the Federal Register of Legislation.

Note:    The register may be accessed at www.legislation.gov.au.

3        Authority

This instrument is made under s798G(1) of the Corporations Act 2001.

4        Schedules

Each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.

5        Repeal of amending and repealing instruments

(1)     The repeal of an instrument by section 4 does not affect any amendment to or repeal of another instrument (however described) made by the instrument.

(2)     Subsection (1) does not limit the effect of section 7 of the Acts Interpretation Act 1901 as it applies to the repeal of an instrument by section 4 of this instrument.


Schedule 1—Amendments

ASIC Market Integrity Rules (Securities Markets) 2017

1        Subrule 5.4B.1(1)

Omit the subrule, substitute:

“(1) Where a Market Participant handles or executes an Order as a result of an arrangement with another person (the other person) to direct Orders to the Market Participant, the Market Participant:

(a)        must not, indirectly or directly, make a cash payment to the other person or an associate of the other person for the opportunity to handle or execute those Orders, if the cash payment is greater than the dollar value of the Market Participant’s Commission in relation to the Orders; and

(b)       must take reasonable steps to ensure that the other person has not, indirectly or directly, made a cash payment to a third party (the third party) or an associate of the third party to procure the handling or execution of Orders from the third party or a client of the third party, if the cash payment is greater than the dollar value of any payment made, or to be made, by the third party (including a payment made, or to be made, by a client of the third party) to the other person, for directing the Orders to the other person.”

2        Subrule 5.4B.1(2)

Omit the subrule, substitute:

“(2) For the purposes of subrule (1):

associate of the other person or third party includes any director, officer, employee or associated or related company of the other person or of the third party, as the case may be.

Market Participant’s Commission in relation to the Orders means the dollar value of any payment received, or to be received, by the Market Participant (including commission received, or to be received, from a client of the other person) for the opportunity to handle or execute the Orders.”

(3) Where a Market Participant directs an Order to another person (the other person) as a result of an arrangement for the Market Participant to direct Orders to the other person, the Market Participant must not, and must procure that its associates do not, indirectly or directly, accept a cash payment from the other person for directing Orders to the other person, if the cash payment is greater than the dollar value of any payment made, or to be made, by the Market Participant (including a payment made, or to be made, by a client of the Market Participant) to the other person, for directing the Orders to the other person.

(4) For the purposes of subrule (3), an associate of a Market Participant includes any director, officer, employee or associated or related company of the Market Participant.”