ASIC makes this instrument under subsection 798G(1) of the Corporations Act.
1.1.2 Title
This instrument is ASIC Market Integrity Rules (Chi-X Australia Market-Capital) 2014.
1.1.3 Commencement
This instrument commences on the later of:
(a) 26 May 2014; and
(b) the day on which the instrument is registered under the Legislative Instruments Act 2003.
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, section 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 Chi-X Market;
(b) the activities or conduct of persons in relation to the Chi-X Market;
(c) the activities or conduct of persons in relation to Financial Products traded on the Chi-X Market.
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.
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.
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.
Part 1.2 Waiver
1.2.1 Waiver of Rules
(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).
1.2.2 Compliance with conditions
Failure to comply with a condition imposed under Rule 1.2.1 is a contravention of this Rule.
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.
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 persons 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).
Part 1.3 Notice, notification and service of documents
1.3.1 Market Participant to have email
A Market Participant must acquire and maintain an operating email system for the purposes of receiving notices under these Rules.
1.3.2 Methods of giving notice in writing
Unless otherwise specified in a Rule, ASIC may give a 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.
Part 1.4 Interpretation
1.4.1 References to time
In these Rules a reference to time is to the time in Sydney, Australia.
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.
1.4.3 Definitions
“ASIC” means the Australian Securities and Investments Commission.
“ASX” means ASX Limited (ACN 008 624 691).
“ASX Listing Rules” means the Listing Rules of ASX.
“ASX Market” means the market for Financial Products operated by ASX.
“ASX Market Integrity Rules” means the ASIC Market Integrity Rules (ASX Market) 2010, and the ASIC Market Integrity Rules (ASX Market-Capital) 2014, as amended from time to time.
“ASX Participant” means a participant in the ASX Market admitted under the Operating Rules of the ASX Market.
“Australian ADI” has the meaning given by section 9 of the Corporations Act.
“Business Day” means a day other than a Saturday, Sunday, New Year’s Day, Good Friday, Easter Monday, Christmas Day or Boxing Day.
“CHESS Depository Interest” has the meaning given to the term “CDI” by rule 2.13.1 of the operating rules of ASX Settlement Pty Limited (ACN 008 504 532).
“Chi-X Australia” means Chi-X Australia Pty Ltd (ACN 129 584 667).
“Chi-X Market” means the market operated by the Market Operator under Australian Market Licence (Chi-X Australia Pty Ltd) 2011.
“Clearing Facility” means, in relation to a Market Transaction, the clearing and settlement facility, within the meaning of section 761A of the Corporations Act, through which the Market Transaction has been or will be cleared.
“Clearing Participant” means a person admitted as a participant under the Clearing Rules.
“Clearing Rules” means:
(a) in relation to a particular Clearing Facility, the operating rules, procedures, practices, directions, decisions and requirements of that Clearing Facility;
(b) in relation to a particular Clearing Participant, the rules of the Clearing Facility to which that Clearing Participant is subject.
“Corporations Act” means the Corporations Act 2001 (Cth).
“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.
“ETF” means a Managed Fund:
(a) which is listed on the ASX Market;
(b) with power and approval to continuously issue and have quoted on the ASX Market, Equity Securities in the Managed Fund;
(c) which provides for the issue of new Equity Securities in return for the subscriber transferring to the Managed Fund a portfolio of Securities; and
(d) for which the price of the Financial Product, index, foreign or Australian currency, commodity or other point of reference for determining the value of the Equity Securities is continuously disclosed or can be immediately ascertained.
“ETF Security” means a Financial Product issued by or provided pursuant to an ETF.
“Equity Market Product” means:
(a) a share in a body;
(b) a financial product referred to in subparagraph 764A(1)(b)(i) or subparagraph 764A(1)(ba)(i) of the Act; or
(c) a right (whether existing or future and whether contingent or not) to acquire, by way of issue, the following under a rights issue:
(i) a share covered by paragraph (a); or
(ii) a financial product covered by paragraph (b); or
(d) a CHESS Depository Interest,
admitted to quotation on ASX and able to be traded on the Chi-X Market.
“Equity Securities” means:
(a) shares in a body corporate or an unincorporated body other than redeemable preference shares which are Loan Securities in accordance with paragraph (c) of the definition of Loan Securities; or
(b) interests in a managed investment scheme, except those referred to in paragraph (d) of the definition of Loan Securities; or
(c) renounceable and non-renounceable rights to subscribe for Securities other than Loan Securities; or
(d) options over unissued Securities other than Loan Securities; or
(e) convertible notes; or
(f) any Securities which are determined by the operator of the Relevant Financial Market to be Equity Securities,
but does not include Options Market Contracts, or Securities determined to be Loan Securities by the operator of the Relevant Financial Market.
“Family Trust” means a trust in which:
(a) the person or the Immediate Family of the person is the sole or majority beneficiary; or
(b) the person has the ability to remove the trustee of the trust and replace that trustee with his or her own nominee.
“Financial Product” has the meaning given by Division 3 of Part 7.1 of the Corporations Act.
“Futures Market Contract” means a contract on the terms of a Futures Series.
“Futures Series” means a set of contractual terms on which futures contracts are authorised for trading by the operator of the Relevant Financial Market.
“Immediate Family” in relation to a person, means that person’s spouse and any non-adult children.
“Issuer” means, in relation to an Equity Market Product, the legal entity which issues the Equity Market Product.
“Listing Rules” has the meaning given by section 761A of the Corporations Act.
“Loan Securities” means:
(a) debentures, stocks or bonds issued or proposed to be issued by a government; or
(b) debentures of a body corporate or an unincorporated body; or
(c) redeemable preference shares which have a fixed and certain date for redemption, other than shares having a participating entitlement to rights or options referred to in paragraphs (c) and (d) of the definition of Equity Securities; or
(d) interests in a managed investment scheme, relating to a financial or business undertaking or scheme, common enterprise or investment contract, the trustee or representative or responsible entity of which only invests in or acquires one or more of Loan Securities, mortgages and cash; or
(e) any Securities which are determined by the operator of the Relevant Financial Market to be Loan Securities,
but does not include Options Market Contracts, or Securities determined to be Equity Securities by the operator of the Relevant Financial Market.
“Managed Fund” means a managed investment scheme which is a registered managed investment scheme pursuant to section 601EB of the Corporations Act or a managed investment scheme which ASIC has exempted from those registration requirements.
“Market Operating Rules” means the Operating Rules of the Chi-X Market.
“Market Operator” means Chi-X Australia.
“Market Participant” means a participant in the Chi-X Market admitted under the Market Operating Rules.
“Market Transaction” means a transaction for one or more Equity Market Products, entered into on a Trading Platform or reported to the Market Operator under the Market Operating Rules.
“Official Quotation”, in relation to Financial Products, means admitted to quotation by ASX under the ASX Listing Rules.
“Operating Rules” has the meaning given by section 761A of the Corporations Act.
“Option Series” means a set of contractual terms on which options are authorised for trading by ASX on the ASX Market.
“Options Market Contract” means a contract on the terms of an Option Series.
“Order” means, in relation to Equity Market Products, an instruction to purchase or sell Equity Market Products, or an instruction to amend or cancel a prior instruction to purchase or sell Equity Market Products.
“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.
“Principal Trader” means a Market Participant with Trading Permission which limits it to trading on its own behalf.
“Related Body Corporate” has the meaning given by section 50 of the Corporations Act.
“Relevant Financial Market” has the meaning given by section 9 of the Corporations Act.
“Representative” has the meaning given by section 910A of the Corporations Act.
“Rules” means these market integrity rules.
“Security” or “security” means:
(a) a “security” within the meaning of section 761A of the Corporations Act; or
(b) a managed investment product.
“Trading Messages” means those messages submitted into a Trading Platform relating to trading functions, such as Orders, amendment or cancellation of Orders and the reporting or cancellation of Market Transactions on the Trading Platform.
“Trading Permission” means the right to submit Trading Messages in a Trading Platform.
“Trading Platform” means a facility made available by the Market Operator to Market Participants for the entry of Trading Messages, the matching of Orders and the reporting of transactions.
Note: There is no penalty for this Rule
Part 1.5 Transitional
1.5.1 Repeal
The following provisions of the ASIC Market Integrity Rules (Chi-X Australia Market) 2011 are repealed: