Preliminary
Chapter 1: Introduction
Part 1.1 Preliminary
1.1.1 Enabling legislation
ASIC makes this instrument under subsection 798G(1) of the Corporations Act.
1.1.2 Title
This instrument is ASIC Market Integrity Rules (ASX 24 Market) 2010.
1.1.3 Commencement
This instrument commences on the later of:
(a) the day the instrument is registered under the Legislative Instruments Act 2003; and
(b) the commencement of Schedule 1 to the Corporations Amendment (Financial Market Supervision) Act 2010.
Note: An instrument is registered when it is recorded on the Federal Register of Legislative Instruments (FRLI) in electronic form: see Legislative Instruments Act 2003, s 4 (definition of register). The FRLI may be accessed at http://www.frli.gov.au/.
1.1.4 Scope of these Rules
These Rules apply to:
(a) the activities or conduct of the Market;
(b) the activities or conduct of persons in relation to the Market;
(c) the activities or conduct of persons in relation to Financial Products traded on the Market.
Note: There is no penalty for this Rule.
1.1.5 Entities that must comply with these Rules
The following entities must comply with these Rules:
(a) the Market Operator;
(b) Market Participants; and
(c) Other Regulated Entities;
as specified in each Rule.
Note: There is no penalty for this Rule.
1.1.6 Conduct by officers, employees or agents
In these Rules, conduct engaged in on behalf of a person:
(a) by an officer, Employee, or other agent of the person, and whether or not within the scope of the actual or apparent authority of the officer, Employee, or other agent; or
(b) by any other person at the direction or with the consent or agreement (whether express or implied) of an officer, Employee, or other agent of the person, and whether or not the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the officer, Employee, or other agent,
is deemed to have been engaged in by the person.
Note: There is no penalty for this Rule.
1.1.7 State of mind of a person
(1) If for the purposes of these Rules in respect of conduct engaged in by a person, it is necessary to establish the state of mind of the person, it is sufficient to show that an officer, Employee, or other agent of the person, being an officer, Employee, or other agent by whom the conduct was engaged in and whether or not the conduct was within the scope of the actual or apparent authority of that officer, Employee, or other agent, had that state of mind.
(2) In subrule (1), a reference to the state of mind of a person includes a reference to the knowledge, intention, opinion, belief or purpose of the person and the person’s reasons for the person’s intention, opinion, belief or purpose.
Note: There is no penalty for this Rule.
Part 1.2 Waiver
1.2.1 Waiver of Rules and procedures
(1) Subject to Rule 1.2.3, ASIC may relieve any person or class of persons from the obligation to comply with a provision of these Rules, either generally or in a particular case or category, and either unconditionally or subject to such conditions as ASIC thinks fit.
(2) If any conditions on a waiver given under subrule (1) are imposed, all of the conditions must be complied with for the waiver to be effective.
(3) ASIC may withdraw, in writing, a waiver given under subrule (1) at any time.
(4) Any request by a person for a waiver under subrule (1) must be in writing.
(5) Any waiver given under subrule (1), and any conditions imposed on that waiver, must be in writing.
(6) ASIC may publish notice of a waiver given under subrule (1).
Note: There is no penalty for this Rule.
1.2.2 Compliance with conditions
Failure to comply with a condition imposed under Rule 1.2.1 is a contravention of this Rule.
Maximum penalty: $1,000,000
1.2.3 Period during which relief applies
ASIC may specify the period or specific event during which any relief from an obligation to comply with a provision of these Rules may apply.
Note: There is no penalty for this Rule.
1.2.4 Register
(1) ASIC may establish and maintain a register for recording details of relief granted under Rule 1.2.1 and may enter the following details in the register:
(a) the date that the relief takes effect;
(b) the person or class of person relieved from the obligation;
(c) the provision to which the relief applies;
(d) brief reasons for the relief; and
(e) any conditions that apply to the relief.
(2) ASIC may publish the register referred to in subrule (1).
Note: There is no penalty for this Rule.
Part 1.3 Notice, notification and service of documents
1.3.1 Market Participant to have email system
A Market Participant must acquire and maintain an operating email system for the purposes of receiving notices under these Rules.
Note: There is no penalty for this Rule.
1.3.2 Methods of giving notice in writing
Unless otherwise specified in a Rule, ASIC may give notice under these Rules by any of the following methods:
(a) delivering it to the recipient personally;
(b) leaving it at or by sending it by courier or post to the address of the recipient last notified to ASIC;
(c) sending it by facsimile to the recipient’s facsimile number last notified to ASIC;
(d) a circular or bulletin addressed to a class of persons and delivered or communicated by any means permitted under this Rule;
(e) specific email by any method which identifies a person or person’s title as addressee and no notice of non-delivery has been received;
(f) broadcast email by any method which identifies the addressee and which, having regard to all the relevant circumstances at the time, was as reliable as appropriate for the purposes for which the information was communicated.
Note: There is no penalty for this Rule.
Part 1.4 Interpretation
1.4.1 References to time
In these Rules a reference to time is to the time in Sydney, Australia.
Note: There is no penalty for this Rule.
1.4.2 Words and expressions defined in the Corporations Act
Words and expressions defined in the Corporations Act will unless otherwise defined or specified in these Rules or the contrary intention appears, have the same meaning in these Rules.
Note: There is no penalty for this Rule.
1.4.3 Definitions
“Acquire” has the meaning given by section 9 of the Corporations Act.
“Approved Foreign Bank” has the meaning given by regulation 1.0.02 of the Corporations Regulations.
“Approved Securities” means those securities described as approved securities by the Market Operator under the Market Operating Rules.
“ASIC” means the Australian Securities and Investments Commission.
“ASIC Act” means the Australian Securities and Investments Commission Act 2001 (Cth).
“ASX Clear” means ASX Clear (Futures) Pty Limited (ACN 050 615 864).
“Australian Financial Services Licence” means a licence granted under section 913B of the Corporations Act.
“Block Trade” means any Trade which is executed via the Block Trade Facility.
“Block Trade Facility” means the facility provided by the Market Operator for Trading Contracts and referred to in the Market Operating Rules as the Block Trade Facility.
“Block Trade Order” means an Order in a Contract prescribed by the Market Operator which must be executed via the Block Trade Facility.
“Business Day” has the meaning given by section 9 of the Corporations Act.
“Call” means the demand for payment of a sum of money made upon a Client.
“Clearing Participant” means a person admitted as a participant under the Clearing Rules.
“Clearing Rules” means operating rules:
(a) as the term is defined in section 761A of the Corporations Act; and
(b) made by ASX Clear.
“Client” means in relation to a Market Participant, any person, partnership or Corporation on behalf of whom the Market Participant enters, Acquires or Disposes of a Futures Contract or Option Contract, or on whose behalf the Market Participant proposes to enter, Acquire or Dispose of a Futures Contract or Option Contract or from whom the Market Participant accepts instructions to enter, Acquire or Dispose of Futures Contracts or Option Contracts.
“Client Account” means an account of a Client.
“Client Trade” means a Trade of a Market Participant held on behalf of a Client.
“Close Out” means to extinguish an Open Position by matching it with an offsetting Open Position and effecting the settlement of each such Open Position against the other.
“Contract” means a contract entered, Acquired or Disposed of on the Market or capable of being entered, Acquired, or Disposed of on the Market.
“Corporation” has the meaning given by section 9 of the Corporations Act.
“Corporations Act” means the Corporations Act 2001 (Cth).
“Corporations Regulations” means the Corporations Regulations 2001 (Cth).
“Cover” means cash and/or Approved Securities as determined by the Market Operator and held by a Market Participant against a Client’s liability from time to time.
“Deal”, “Deal In” or “Dealing” or cognate expressions has the meaning given by section 766C of the Corporations Act.
“Director” has the meaning given by section 9 of the Corporations Act.
“Dispose” has the meaning given by Chapter 7 of the Corporations Act.
“Employee” in relation to a Market Participant includes a Director, employee, officer, agent, Representative, consultant or adviser of that Market Participant, or an independent contractor who acts for or by arrangement with a Market Participant.
“Error Trade” means a Trade transacted in error.
“Exchange For Physical” means a transaction where:
(a) a bona fide physical transaction in a commodity or instrument is completed and physical delivery takes place at the time of the transaction or is intended by both parties to take place at a later time; and
(b) at or about the same time a Contract, opposite in effect, is entered, Acquired or Disposed of by a Market Participant or two Market Participants, for the same or similar quantity or amount of the commodity or a substantially similar commodity or instrument between Market Participants, on behalf of the parties to the physical transaction.
“Expression of Interest” means an enquiry made to a Market Participant either:
(a) to obtain the current best bid and/or offer in a particular Contract; or
(b) to enquire as to the volume that may be obtained at a given price;
but is not a firm Order to buy or sell.
“Financial Products” has the meaning given by Division 3 of Part 7.1 of the Corporations Act.
“Futures Contract” means a Contract designated as a “Futures Contract” by the Market Operator in the Market Operating Rules.
“House Account” means any account other than a Client Account.
“House Trade” means any Trade other than a Client Trade.
“In Writing” means written, typed, printed or lithographed, or partly one and partly another and including any other mode of representing or reproducing words in a visible form, including electronically produced, displayed and recorded matter.
“Initial Margin” means the amount which a Market Participant requires to be paid by a Client in respect of a Futures Contract entered into or proposed to be entered into on behalf of a Client.
“Margin” means Initial Margin and Variation Margin.
“Market” means the market operated by the Market Operator under the Australian Market Licence (Australian Securities Exchange Limited) 2002.
“Market Operator” means Australian Securities Exchange Limited (ACN 000 943 377).
“Market Operating Rules” means the Operating Rules of the Market.
“Market Participant” means a participant in the Market admitted under the Market Operating Rules.
“Minimum Volume Threshold” means the threshold determined by the Market Operator under the Market Operating Rules, being the minimum number of lots in respect of each Contract.
“Month” means calendar month.
“Open Position” An open position exists where the obligations under a Contract held by a party, which has not been closed out are yet to be performed and will refer as the context requires either to an open position as defined by the Clearing Rules held by a Clearing Participant or to such an open position which is held by a Market Participant on the instructions of a client, including open positions held, where applicable on markets other than the Market.
“Operating Rules” has the meaning given by section 761A of the Corporations Act.
“Option” or “Option Contract” means an Option over:
(a) a Futures Contract or a number of Futures Contracts; or
(b) an Option over an Underlying Physical,
as listed by the Market Operator.
“Order” means an instruction to enter into a Contract, or an instruction to amend or cancel a prior instruction to enter into a Contract.
“Order System” means a software application, satisfactory to the Market Operator, for entering Orders into the Trading Platform through a Terminal.
“Other Regulated Entities” means entities prescribed by regulations made for the purposes of paragraph 798H(1)(c) of the Corporations Act, that must comply with these Rules.
“Pre-Opening Phase” has the meaning given by the Market Operating Rules.
“Principal Trader” has the meaning given by the Market Operating Rules.
“Related Body Corporate” has the meaning given by section 9 the Corporations Act.
“Representative” has the meaning given by section 910A of the Corporations Act.
“Roll Business” means trading a position from the nearest delivery month to an equivalent position in a different delivery month.
“Rules” means these Market Integrity Rules.
“Strategy Trade” means a Trade designated by the Market Operator as a strategy trade under the Market Operating Rules.
“Terminal” means an automated Order entry interface through which an Order System routes Orders to the Trading Platform.
“Trade” and similar expressions means “trade” as defined in section 9 of the Corporations Act.
“Trading Day” means a day on which the Market is open for Trading.
“Trading Participant” has the meaning given by the Market Operating Rules.
“Trading Platform” means a facility made available by the Market Operator to Market Participants for the entry of trading messages, the matching of Orders, the advertisement of invitations to Trade and the reporting of transactions.
“Underlying Physical” means the asset, instrument, index, reference rate or any other thing, excluding a Futures Contract, whose price movement determines the value of the Contract.
“Variation Margin” means the difference between the value of a Futures Contract or Option Contract as shown in the Contract, and the value of that Contract at any given time.