ASIC Consulting on Revised Licence Regime for Domestic and Overseas Operators

ASIC has announced that it is seeking feedback on the proposed rules which are documented in Consultation Paper 293 - Revising the market licence regime for domestic and overseas operators (“CP 293”).

You can download a copy of CP 293 by clicking here. Attachment 1 to CP 293 can be found by clicking here.

ASIC is considering the proposal to introduce a two-tiered market licence regime, based on a risk-based assessment. This will result in reduced regulatory oversight and a reduced regulatory burden for lower risk financial markets. This approach will permit ASIC to create a more flexible model which will:

  • Facilitate oversight of traditional market models and significant non-exchanges (Tier 1).

  • Appropriately tailor regulatory obligations for a broad range of specialised and emerging market venues (Tier 2).

Tier 1 market venues are those that are or are expected to become significant to the Australian economy, as well as venues that are or are expected to become significant to the efficiency and integrity of, and investor confidence in, the financial system.

Tier 2 market venues are those that do not meet the threshold of a Tier 1 venue.

Tier 1 - Significant to Tier 1 financial system or investor confidence.

Domestic exchanges.
Domestic exchanges.
Significant non-exchanges.

Tier 2 - Most other trading venues

Private markets.
Securities lending.
Other professional markets.
New venues.

Exempt venues

Costs outweigh regulatory benefit; or outcomes achieved in another way.

The consultation paper also:

  • Proposes updating and clarifying the guidance about how licensees may comply with specific licence obligations.
  • Proposes to consolidate ASIC Regulatory Guide (“RG”) 177 into RG 172.
  • Sets out the relevance of the proposals for secondary trading in shares of eligible crowd sourced funding companies.
  • Addresses implementation and transitional concerns.

The proposals which are contained in CP 293 follow the passing of the Corporations Amendment (Crowd-sourced Funding) Act 2017 (Crowd Sourced Funding Act), which amended the provisions relating to the market licence regime.

Submissions to CP 293 are due by 31 August 2017.

Should you have any queries about ASIC or other issues involving compliance, licensing, or corporate governance, please contact Jeremy Danon, director of Ariel & Associates Pty Ltd on (02) 8223 3355 or at