Overseas Clearing and Settlement Facilities: The Australian Licensing Regime

In March 2015, the Council of Financial Regulators (CFR) released the Consultation Paper: Overseas Clearing and Settlement Facilities: The Australian Licensing Regime. The consultation paper set out a proposal for legislative change to clarify when an overseas clearing and settlement (CS) facility would fall within the scope of the Australian CS facility licensing regime. Any legislative change will ultimately be a matter for the Government to consider.

The increasingly global nature of many financial markets, combined with regulatory reforms, has prompted increased participation by Australian financial institutions in overseas CS facilities. The proposal seeks to provide greater clarity regarding the circumstances in which a CS facility must be either licensed in Australia or exempted from the Australian CS facility licensing regime. Greater clarity on this issue will provide increased certainty for overseas CS facilities and their participants, and facilitate Australian entities' access to a diverse range of clearing and settlement options, both in Australia and overseas. It is not expected that the proposed new approach would result in additional CS facilities being within the scope of Australia's CS facility licensing regime, and the rest of the Australian CS facility licensing regime would remain unchanged.

This consultation closed on 8 May 2015.

For further details, please see the CFR consultation paper: Overseas Clearing and Settlement Facilities: The Australian Licensing Regime

Submissions Received

Australian Financial Markets Association
25 May 2015

ASX Group
8 May 2015

Japan Securities and Clearing Corporation
1 May 2015

LCH.Clearnet Limited
8 May 2015