Part 5.1AA Transactions to be under the operating rules of a Market operator
5.1AA.1 Transactions to be under the operating rules of a Market operator
A Market Participant must not enter into a transaction in:
(a) an Equity Market Product other than Under the Rules of a Market;
(b) a CGS Depository Interest other than Under the Rules of a CGS Market,
unless the transaction is entered into pursuant to:
(c) the terms of the relevant product, including a redemption; or
(d) a primary market action, including a Takeover Off-Market Bid for relevant products or an issue, allotment or subscription of new relevant products.
Part 5.1 Client order priority
5.1.1 Application and meaning of dealing on “Own Account”
Subject to Rule 5.1.2, a reference to a Market Participant having an order for its own account means:
in relation to Cash Market Transactions, that the Cash Market Products to be bought or sold are (in the case of a sale) or will be on the completion of the transaction (in the case of a purchase) beneficially owned by the Market Participant or a Prescribed Person, where the Cash Market Products beneficially owned by a Market Participant or Prescribed Person include Cash Market Products which would appear as assets on the balance sheet or consolidated balance sheet of that Market Participant or Prescribed Person; and
(b) in relation to Derivatives Market Transactions, having an order to enter into a Derivatives Market Transaction on its own behalf or for the benefit of a Prescribed Person.
5.1.2 Exceptions
The following are not regarded as orders on a Market Participant’s own account:
an order placed by a life insurance company registered under the Life Insurance Act 1995 (or equivalent State legislation) on behalf of a statutory fund;
(b) an order placed by a Controller or a related body corporate of the Market Participant or of a Controller on behalf of clients of, or funds managed by them or their related bodies corporate.
5.1.3 Fairness and priority in dealing
A Market Participant must deal fairly and in due turn with:
clients’ Orders; and
(b) a client Order and an Order on its Own Account.
5.1.4 Relevant factors
(1) In considering whether Rule 5.1.3 has been complied with, the following factors are relevant:
the Market Participant acts in accordance with its instructions;
(b) orders that do not involve the exercise of discretion by the Market Participant in relation to the time or price or quantity of the order are entered in a Trading Platform in the sequence in which they are received, and otherwise as expeditiously as practicable;
(c) orders of a client (which is not a Prescribed Person) that involve the exercise of discretion by the Market Participant in relation to the time or price or quantity of the order are given preference, within the meaning of subrule (2), over Orders on the Market Participant’s Own Account, unless the client otherwise consents;
(d) if the sequence of entry of Orders into a Trading Platform is not clearly established by the time the Orders were received, and one of the Orders is for the Market Participant’s Own Account, the Market Participant gives preference to the Order of a client over any order for the Market Participant’s Own Account;
(e) if the Market Participant has acted in accordance with its procedures to ensure that a person initiating, transmitting or executing an Order who is aware of instructions of a client (which is not a Prescribed Person) to deal in the relevant products that has not been entered in a Trading Platform does not use that information to the disadvantage of that client;
(f) the Market Participant buys or sells for a wholesale client;
(g) allocation of Market transactions occurs in accordance with Rule 5.1.5; and
(h) a Market Participant’s Orders on its Own Account are not knowingly interposed between Orders of its clients that would otherwise have Crossed.
(2) In paragraph (1)(c), a reference to a Market Participant giving preference to an Order of a client over an Order on the Market Participant’s Own Account, means that from the time of receipt of the Order until it is fully executed, the Market Participant does not enter into, on its Own Account, a Market transaction for the same financial products on the same terms, having regard to subrule (3), unless:
the financial products are allocated to the client in accordance with paragraph 5.1.6(c); or
(b) the financial products are allocated to the client pursuant to an allocation policy previously disclosed to the client, to which the client consents, under which the Market Participant may buy or sell (and be allocated) the same financial products on its Own Account.
(3) For the purposes of subrule (2), a limit order which cannot be executed owing to price differences is not on the same terms.
(4) A Market Participant must keep a record of any consent given by a client for the purposes of paragraph (1)(c).
5.1.5 Fairness and priority in allocation
A Market Participant must allocate Market transactions fairly.
5.1.6 Relevant factors
In considering whether Rule 5.1.5 has been complied with, the following factors are relevant:
allocation of Market transactions is immediate and automatic, unless circumstances or instructions justify later or manual allocation;
(b) Market transactions executed pursuant to instructions (whether an Order of a client or an Order on its Own Account) are allocated in the sequence in which the Market Participant received those instructions, entered those instructions or the Market transactions were effected;
(c) the client’s instructions;
(d) allocation of a Market transaction occurs in accordance with the disclosed allocation policy of the Market Participant; and
(e) except as provided in these Rules or the operating rules of the Market where the transaction was executed, a Market Participant does not allocate Market transactions to fulfil all or part of an Order for its Own Account when it has an unfulfilled Order on the same terms for those Market transactions from a client.
5.1.7 Unexecuted order in Underlying Financial Products—Trading Participant not to make Bids or Offers
If a Trading Participant has or receives an Order to buy or sell an Underlying Financial Product in the Underlying Market which may materially affect:
the market price of the Underlying Financial Product in the Underlying Market; or
(b) the level of an Underlying Index, the level of which is calculated by reference to the value of that Underlying Financial Product and other financial products,
the Trading Participant must not make Bids or Offers to enter into an Options Market Transaction over that Underlying Financial Product as Principal until the Order in the Underlying Financial Product has been executed in the Underlying Market.
5.1.8 Allocation policy and Automated Client Order Processing Crossings—Disclosure to Client
(1) A Market Participant must when requested to do so by a person (the Client), disclose to the Client each of the following:
the policy it adopts in the allocation of Market transactions to fill orders placed with it, for each Market requested by the Client; and
(b) in relation to Crossings under the operating rules of each Market requested by the Client:
that the Client’s orders may match opposite orders in a Trading Platform by the same Market Participant, effectively resulting in a Crossing and entitling the Market Participant to commission from both sides of the transaction; and
(ii) if the Market Participant deals as Principal, that the Client’s orders may match opposite orders in a Trading Platform on behalf of the same Market Participant as Principal.
(2) The Market Participant must keep a record of disclosures made under subrule (1).
Part 5.4 Transactions by connected persons (including persons connected with other Market Participants)
5.4.1 Application
In this Part 5.4, a reference to a connected person is a reference to the following persons:
an Employee;
(b) a company controlled by an Employee; and
(c) a Controlled Trust (other than a trust controlled by an Immediate Family of an employee or a trust in relation to which an Immediate Family of an Employee is a trustee or holds more than 50% of the whole beneficial interest).
5.4.2 Internal consent required for trading by connected persons
(1) A Market Participant must not enter into a Market transaction by or for the account of its connected persons, whether the Market transaction is conducted through that Market Participant or through another Market Participant, unless the Market transaction has been approved in writing in accordance with subrule (4) by a director or partner of the Market Participant or a person with written delegation for that responsibility from a director or partner (other than the Employee concerned).
(2) A Market Participant must obtain a separate approval under subrule (1) for each relevant Market transaction.
(3) A Market Participant must take reasonable steps to ensure that a person who approves a Market transaction under subrule (1) takes into account the circumstances of the proposed transaction and anything which might materially affect the price of the relevant Cash Market Product (or, in the case of a Derivatives Market Transaction, the price or value of the relevant Contract Series) the subject of the Market transaction.
(4) For the purposes of subrule (1), the approval in writing must include:
all the information required by Part 4.1 for orders, whether or not the Market Participant will be executing the order to which the approval relates; and
(b) the date and time of approval.
(5) If a Market transaction referred to in subrule (1) is conducted through another Market Participant, that Market Participant must, as soon as practicable after entering into the Market transaction, give to the employing Market Participant a confirmation in respect of the Market transaction.
Part 5.4A Managing confidential Order information
5.4A.1 Protection of Order information
(1A) In this Rule, Order means an instruction to purchase or sell, or an instruction to amend or cancel a prior instruction to purchase or sell:
(1) A Market Participant must take reasonable steps to ensure its officers and employees do not use or disclose information about Orders received by the Participant or transactions resulting from those Orders unless permitted or required under these Rules or the law.
(2) Subrule (1) does not apply to:
(a) information about Orders or transactions if that information is generally available;
(b) Pre-Trade Information about Orders received by a Market Participant if the Pre-Trade Information has been made available by a Market operator under Rule 6.1.2;
(c) Pre-Trade Information about Orders received by a Market Participant if it is necessary to use or disclose that Pre-Trade Information to execute an Order (including disclosure of the Pre-Trade information in a routing instruction);
(d) Post-Trade Information about transactions resulting from Orders received by a Market Participant if the Post-Trade Information has been made available by a Market operator under Rule 6.3.4;
(e) Post-Trade Information about transactions resulting from Orders received by a Market Participant if it is necessary to disclose that Post-Trade Information for confirmation or billing purposes;
(f) information about Orders or transactions disclosed to a person that:
(i) maintains or services the Market Participant’s internal Order management system(s) or Crossing System(s) and who has agreed, in writing, to limit its use of the Order and transaction information disclosed to it to the purposes of that maintenance or service; or
(ii) provides Administrative Services or analytical services to or for the Market Participant in relation to Orders and transactions and who has agreed, in writing, to limit its use of the Order and transaction information disclosed to it to the purposes of those Administrative Services or analytical services, as applicable.
(3) For the purposes this Rule, Administrative Services includes Order routing or execution services.
Part 5.4B Order incentives
5.4B.1 Prohibition on Order incentives
(1A) In this Rule Order means an instruction to purchase or sell, or an instruction to amend or cancel a prior instruction to purchase or sell:
(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:
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
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) 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.
Part 5.5 Participant’s trading infrastructure
5.5.1 Knowledge of Trading Participant
If a Trading Message embedded with a Trading Participant’s unique identifier is submitted in a Trading Platform the Trading Message is taken for all purposes under these Rules to have been submitted in the Trading Platform by or with the knowledge of the Trading Participant.
5.5.2 Organisational and technical resources
A Trading Participant must have and maintain the necessary organisational and technical resources to ensure that:
Trading Messages submitted by the Trading Participant do not interfere with:
the efficiency and integrity of a Market; or
(ii) the proper functioning of a Trading Platform; and
(b) the Trading Participant complies at all times with these Rules and the operating rules of all Markets of which it is a Trading Participant.
5.5.3 Trading management arrangements
A Trading Participant must have arrangements in place so that at all times the Trading Participant can determine the origin of all orders and Trading Messages, including:
the different stages of processing each order (regardless of whether a Trading Message is generated) and the time at which each stage of processing occurred;
(b) the Order that corresponds to a Trading Message;
(c) the identity and capacity of the person placing the Order that corresponds to the Trading Message;
(d) whether the Trading Message was the result of Automated Order Processing;
(e) the Open Interface Device and the computer or other device of the Trading Participant connected to an Open Interface Device of the Trading Participant through which the Trading Message was submitted;
(f) the DTR with responsibility for that Open Interface Device or computer or other device connected to the Open Interface Device (unless the Trading Message was the result of Automated Order Processing); and
(g) whether the Trading Message was submitted on the Trading Participant’s Own Account or for a client.
5.5.4 Trading management arrangements—Records
A Trading Participant must maintain records of the matters referred to in Rule 5.5.3, for a period of seven years from the date of the Trading Message to which the matters relate.
Part 5.6 Automated Order Processing—Filters, conduct, and infrastructure
5.6.1 Responsible use of system for Automated Order Processing
A Trading Participant which uses its system for Automated Order Processing must at all times:
have appropriate automated filters, in relation to Automated Order Processing; and
(b) ensure that such use does not interfere with:
the efficiency and integrity of a Market;
(ii) the proper functioning of any Trading Platform; or
(iii) the efficiency and integrity of any Crossing System operated by the Trading Participant.
5.6.2 Authorised Persons for Automated Client Order Processing
A Trading Participant which uses its system for Automated Client Order Processing must also have procedures in place to ensure that each Authorised Person has demonstrated to the Trading Participant knowledge of the order entry system of the Trading Participant and of the Dealing Rules, directions, decisions and requirements of the relevant Market operator relevant to the type of Order submission facilities given to the Authorised Person by the Trading Participant.
5.6.3 Automated Order Processing system requirements
(1) A Trading Participant which uses its system for Automated Order Processing must ensure that the system has in place:
organisational and technical resources, including having appropriate automated filters, filter parameters and processes to record any changes to the filters or filter parameters, to enable Trading Messages to be submitted into a Trading Platform without interfering with the efficiency and integrity of the relevant Market or the proper functioning of that Trading Platform;
(b) trading management arrangements, including having appropriate automated filters, filter parameters and processes to record any changes to the filters or filter parameters to enable the ready determination of the origin of all orders and trading messages;
(c) security arrangements to monitor for and prevent unauthorised persons having access to a gateway or an Open Interface Device or to a computer or other device connected to an Open Interface Device, and to ensure that the Automated Order Processing system does not interfere with the efficiency and integrity of the relevant Market or the proper functioning of a Trading Platform in relation to that Market;
controls, including automated controls, that enable immediate suspension, limitation or prohibition of the conduct of all Automated Order Processing or Automated Order Processing in respect of:
(i) one or more Authorised Persons or clients;
(ii) Automated Client Order Processing;
(iii) one or more financial products; or
(iv) one or more Markets.
controls that enable immediate:
suspension of, limitation of, or prohibition on, the entry into a Market of Trading Messages in a series of related Trading Messages where the Trading Participant has identified that Trading Messages in the series have entered a Market and have interfered with or are likely to interfere with the efficiency or integrity of the relevant Market;
(ii) cancellation of Trading Messages in a series that have already entered a Market where the entry of further messages in the series has been suspended, limited or prohibited under subparagraph (i);
(iii) suspension of, limitation of, or prohibition on, the entry into any Crossing System operated by the Trading Participant of Orders in a series of related Orders where the Trading Participant has identified that Orders in the series have entered the Crossing System operated by the Trading Participant and have interfered with or are likely to interfere with the efficiency or integrity of the Crossing System; and
(iv) cancellation of Orders in a series that have already entered a Crossing System operated by the Trading Participant where the entry of further Orders in the series has been suspended, limited or prohibited under subparagraph (iii).
(2) A Trading Participant that uses its system for Automated Order Processing must have direct control over all automated filters and the filter parameters for those filters.
5.6.4 Review of documentation and systems prior to use of Automated Order Processing system
Before using their system for Automated Order Processing in relation to a Market, a Trading Participant must, for the purposes of providing the certification referred to in Rule 5.6.6, perform a review of the Trading Participant’s policies, procedures, system design documentation, including the Trading Participant’s procedures for implementation of subsequent changes to the Automated Order Processing software, filters and filter parameters, and other relevant documentation concerning the Trading Participant’s compliance with Part 5.6 of these Rules, for the relevant Market.
5.6.5 Representations as to organisational and technical resources, trading management arrangements and security arrangements, prior to use of Automated Order Processing system
(1) Before using their system for Automated Order Processing in relation to a Market, a Trading Participant must, for the purposes of providing the certification referred to in Rule 5.6.6, obtain written representations that the Trading Participant has in place organisational and technical resources, arrangements and controls in relation to the system for Automated Order Processing that meet the requirements of Rule 5.6.3, for the relevant Market.
(2) The representations referred to in subrule (1) must:
be provided by persons who are suitably qualified and experienced in relation to the organisational and technical resources, arrangements and controls for which they are making the representation;
(b) include the name of the person making the representation;
(c) be signed and dated by the person making the representation; and
(d) set out the methodology used by the person to enable them to make the representation.
5.6.6 Certification of Automated Order Processing system
(1) Before using their system for Automated Order Processing in relation to a Market, a Trading Participant must, for the relevant Market:
give a written certification (AOP Initial Certification) to ASIC that includes the matters set out in subrule (2); and
(b) receive a written confirmation from ASIC that the AOP Initial Certification complies with subrule (2).
(2) The AOP Initial Certification given by the Trading Participant to ASIC must include:
the name of the Trading Participant;
(b) the version number and name of the Trading Participant’s Automated Order Processing system;
(c) copies of the representations required by Rule 5.6.5 in relation to the system referred to in paragraph (b);
(d) a confirmation by the Trading Participant that:
the Trading Participant has performed the review required by Rule 5.6.4 and that nothing came to the attention of the Trading Participant during the course of that review which would indicate that the Trading Participant is unable to comply with Part 5.6 of these Rules;
(ii) based on the review required by Rule 5.6.4 and the representations required by Rule 5.6.5, the Trading Participant’s Automated Order Processing system:
does, or does not, permit Automated Client Order Processing, as the case may be; and
(B) meets the requirements of Rule 5.6.3; and
(iii) the representations required by Rule 5.6.5 have been made by persons whom the Trading Participant considers to be suitably qualified and experienced in relation to the organisational and technical resources, arrangements and controls for which they are making those representations;
(e) the name of the directors of the Trading Participant referred to in subrule (3).
(3) At least two directors of the Trading Participant must sign and date the written certification referred to in subrule (2).
5.6.8 AOP Material Change Review
(1) Before making a material change to any of the organisational or technical resources, arrangements or controls employed to comply with Rule 5.6.3 for a Market, a Trading Participant must ensure that an appropriately qualified person performs a review (AOP Material Change Review) of the material changes to the Automated Order Processing system, the Trading Participant’s policies, procedures, system design documentation, including the Trading Participant’s procedures for implementation of subsequent changes to the Automated Order Processing software, filters and filter parameters and other relevant documentation concerning the Trading Participant’s compliance with Part 5.6 of these Rules for the relevant Market.
(2) Before implementing a material change the subject of an AOP Material Change Review a Trading Participant must, for the purposes of providing the AOP Annual Notification, obtain written representations from the person who performed the AOP Material Change Review that nothing came to the attention of the person during the course of the AOP Material Change Review that would indicate that the Trading Participant is unable to comply with Part 5.6 of these Rules.
(3) The representations referred to in subrule (2) must:
include the name of the person making the representation; and
(b) be signed and dated by the person making the representation.
5.6.8A AOP Annual Review
(1) Where a Trading Participant has not performed an AOP Material Change Review in relation to an Automated Order Processing system for a Market in the 12 months before the AOP Annual Review Date, the Trading Participant must, for the purposes of providing the AOP Annual Notification in relation to the Automated Order Processing system, ensure that an appropriately qualified person performs a review (AOP Annual Review) of the Automated Order Processing system, the Trading Participant’s policies, procedures, system design documentation, including the Trading Participant’s procedures for implementation of changes to the Automated Order Processing software, filters and filter parameters and other relevant documentation concerning the Trading Participant’s compliance with Part 5.6 of these Rules.
(2) A Trading Participant must, for the purposes of providing the AOP Annual Notification in relation to an Automated Order Processing system for a Market, obtain written representations from the person who performed the AOP Annual Review in relation to that Automated Order Processing system, that nothing came to the attention of the person during the course of the AOP Annual Review that would indicate that the Trading Participant is unable to comply with Part 5.6 of these Rules, for the relevant Market.
(3) The representations referred to in subrule (2) must:
include the name of the person making the representation; and
(b) be signed and dated by the person making the representation.
5.6.8B AOP Annual Notification
(1) A Trading Participant must, within 10 Business Days of each AOP Annual Review Date for a Market, give a written notice (AOP Annual Notification) to ASIC that includes, for the relevant Market:
the name of the Trading Participant; and
(b) the version number and name of the Trading Participant’s Automated Order Processing system; and
(c) a confirmation by the Trading Participant that nothing came to the attention of the Trading Participant during the 12 months before the AOP Annual Review Date that would indicate that the Trading Participant is unable to comply with Part 5.6 of these Rules; and
(d) the name of the directors of the Trading Participant referred to in subrule (2).
(2) At least two directors of the Trading Participant must sign and date the AOP Annual Notification.
5.6.11 Further certification
(1) A Trading Participant must, if directed by ASIC in writing to do so, provide a further certification for a Market in a form acceptable to ASIC from an appropriately qualified person acceptable to ASIC as to compliance by the Trading Participant with the Automated Order Processing Requirements for the relevant Market.
(2) A Trading Participant must comply with a direction under subrule (1) within the time specified in the direction.
5.6.12 Limitations on Automated Order Processing
(1) This Rule applies where ASIC reasonably considers that:
a Trading Participant is not complying with the Automated Order Processing Requirements in relation to one or more Markets; or
(b) it is otherwise appropriate to direct a Trading Participant to take the actions referred to in subrule (2).
(2) A Trading Participant must, if directed to do so by ASIC:
cease conducting Automated Order Processing in relation to one or more Markets until ASIC is satisfied that the Trading Participant complies with the Automated Order Processing Requirements for the relevant Market; or
(b) immediately suspend, limit or prohibit the conduct of Automated Order Processing in respect of:
one or more Authorised Persons or clients;
(ii) Automated Client Order Processing;
(iii) Automated Order Processing;
(iv) one or more financial products; or
(v) one or more Markets,
as required by the direction.
Part 5.7 Manipulative trading
5.7.1 False or misleading appearance
A Market Participant must not make a Bid or Offer for, or deal in, any financial product:
as Principal:
with the intention; or
(ii) if that Bid, Offer or dealing has the effect, or is likely to have the effect,
of creating a false or misleading appearance of active trading in any financial product or with respect to the market for, or the price of, any financial product; or
on account of any other person where:
the Market Participant intends to create;
(ii) the Market Participant is aware that the person intends to create; or
(iii) taking into account the circumstances of the Order, a Market Participant ought reasonably suspect that the person has placed the Order with the intention of creating,
a false or misleading appearance of active trading in any financial product or with respect to the market for, or the price of, any financial product.
5.7.2 Circumstances of Order
In considering the circumstances of the Order, a Market Participant must have regard to the following matters:
whether the Order or execution of the Order would be inconsistent with the history of or recent trading in that financial product;
(b) whether the Order or execution of the Order would materially alter the market for, or the price of, the financial product;
(c) the time the Order is entered or any instructions concerning the time of entry of the Order;
(d) whether the person on whose behalf the Order is placed, or another person who the Market Participant knows to be a Related Party of that person, may have an interest in creating a false or misleading appearance of active trading in any financial product or with respect to the market for, or the price of, any financial product;
(e) whether the Order is accompanied by settlement, delivery or security arrangements which are unusual;
(f) where the Order appears to be part of a series of Orders, whether when put together with other Orders which appear to make up the series, the Order or the series is unusual having regard to the matters referred to in this Rule 5.7.2;
(g) whether there appears to be a legitimate commercial reason for that person placing the Order, unrelated to an intention to create a false or misleading appearance of active trading in or with respect to the market for, or price of, any financial product;
(h) whether the transaction, bid or offer the execution of which is proposed will involve no change of beneficial ownership;
(i) the frequency with which Orders are placed by a person;
(j) the volume of financial products the subject of each Order placed by a person; and
(k) the extent to which a person amends or cancels an instruction to purchase or sell a financial product relative to the number of transactions executed for that person.
5.7.3 Obligations apply to Automated Order Processing
A Market Participant must also comply with this Part 5.7 in respect of Orders the subject of Automated Order Processing.
Part 5.9 Fair and orderly markets
5.9.1 Market must remain fair and orderly
A Market Participant must not do anything which results in a market for a financial product not being both fair and orderly, or fail to do anything where that failure has that effect.
5.9.2 Representative must be available
A Trading Participant must ensure that a Representative of the Trading Participant is available to receive communications from other Trading Participants of the relevant Market or from the operator of the relevant Market during the following times on a Trading Day:
for a Market that operates an Open Session State and a CSPA Session State:
in relation to Cash Market Products—from the beginning of Open Session State until the end of CSPA Session State;
(ii) in relation to Options Market Contracts—during Open Session State;
(b) for a Market that does not operate an Open Session State and a CSPA Session State but operates a Continuous Trading Period and a Post-Trading Administration Period—from the beginning of the Continuous Trading Period until the end of the Post-Trading Administration Period;
(c) for a Market that does not operate the session states or periods referred to in paragraphs (a) or (b)—during Trading Hours;
unless otherwise determined in writing by ASIC and notified to the Trading Participant.
5.9.3 Must not take advantage of breakdown or malfunction
A Market Participant must not take advantage of a situation arising as a result of a breakdown or malfunction in any Market operator’s procedures or systems or an error in any Trading Message submitted by the relevant Market operator.
Part 5.9A Trading Suspensions
5.9A.1 Prohibition on trading during Trading Suspensions
(1) A Market Participant must not match an Order or execute a transaction in connection with an Order in circumstances where the financial product the subject of the transaction is in a Trading Suspension on all Markets on which that financial product is quoted.
(2) In this Rule, Order means an instruction to purchase or sell, or an instruction to amend or cancel a prior instruction to purchase or sell:
Part 5.10 Dealing in Cash Market Products
5.10.1 Trading Participants may not deal in Cash Market Products for which Official Quotation will be sought
Except as permitted in Rule 5.10.2, a Trading Participant is prohibited, either in its own office or elsewhere, from making quotations or dealing in a new issue or placement of Cash Market Products (except Loan Securities):
made for the purpose of qualifying a company for admission to the Official List of a Market; or
(b) for which Official Quotation or permission to be traded on any Market will be sought,
until those Cash Market Products have been granted Official Quotation or permission to be traded (as applicable) on a Market.
5.10.2 When Trading Participants may deal in Cash Market Products for which Official Quotation will be sought
Notwithstanding Rule 5.10.1, a Trading Participant may deal in Cash Market Products to which Rule 5.10.1 applies, subject to any other provisions of these Rules and the operating rules of the Market on which Official Quotation of, or permission to be traded, the Cash Market Products will be sought, in the following circumstances:
the Trading Participant may underwrite or sub-underwrite a new issue or placement of Cash Market Products;
(b) the Trading Participant may dispose of Cash Market Products if those Cash Market Products comprise an underwriting or sub-underwriting shortfall;
(c) where the Cash Market Products have been issued on a pro-rata basis to holders;
(d) where a listed entity acquires assets and as part or full consideration, issues new Cash Market Products (except Loan Securities) to the vendor and the Trading Participant:
has made a prior firm arrangement with the vendor to place these Cash Market Products as soon as they are issued; and
(ii) ensures that the details of the issue to the vendor are advised to the relevant listing Market by the listed entity immediately the Cash Market Products are issued;
(e) where a Trading Participant:
makes a placement of new Cash Market Products (except Loan Securities) for which Official Quotation or permission to be traded on a Market will be sought, and the Trading Participant ensures that all investors accepting the Cash Market Products are informed in writing that Trading Participants cannot deal in the Cash Market Products either as Principal or agent until Official Quotation or permission to be traded on that Market is granted in respect of those Cash Market Products;
(ii) accepts selling orders in Cash Market Products (except Loan Securities) for which Official Quotation or permission to be traded on a Market will be sought, and the Trading Participant takes all reasonable steps to ensure that the Cash Market Products are not sold before the Cash Market Products have been granted Official Quotation or permission to be traded on that Market; or
(iii) accepts selling orders in Cash Market Products (except Loan Securities) where the Cash Market Products are of the same class as Cash Market Products which have already been granted Official Quotation or permission to be traded on the Market and:
the Cash Market Products have already been issued by the Issuer; and
(B) the fact that the Cash Market Products have been issued has been notified to, and released to the relevant Market by, the Company Announcements Office of the relevant Market operator;
(f) a Trading Participant may dispose of or acquire ETF Securities which are the subject of a subscription application if:
the ETF Securities are in a class of ETF Securities which are quoted on a Market;
(ii) the subscription application is irrevocable and subject only to transfer of the subscription consideration from the subscriber to the Issuer;
(iii) the disposal or acquisition is made on the relevant Market in accordance with these Rules and the operating rules of that Market;
(iv) there is an arrangement between the Issuer and the relevant Market operator under which the ETF Securities will be granted Official Quotation or permission to be traded on the relevant Market before settlement of the disposal or acquisition; and
(v) the number of ETF Securities on issue is regularly reported to the operator of the relevant Market on the basis required by the operator of that Market.
5.10.3 Dealings in Securities for which Official Quotation will not be sought
A Trading Participant may deal in new Securities issued by a listed entity of a Market for which Official Quotation or permission to be traded on that Market will not be sought, 24 hours after that entity has advised that Market of the details of the issue.
5.10.4 Dealings in Cash Market Products suspended from Official Quotation
A Trading Participant of a Market must not deal in Cash Market Products which have been suspended from quotation or trading on a Market unless the Cash Market Product is an Equity Market Product that is quoted on one or more other Markets and is not in a Trading Suspension on one or more of those other Markets.
Part 5.11 Suspicious activity reporting
5.11.1 Notification requirement
(1) Subject to subrule (2), if a Market Participant has reasonable grounds to suspect that:
a person (the Insider) has placed an order into or entered into a transaction on a Market in relation to a financial product while in possession of inside information (within the meaning of section 1042A of the Corporations Act), whether or not the Market Participant is aware of:
the identity of the Insider; or
(ii) all of the details of the order or transaction; or
(b) a transaction or an order transmitted to a Trading Platform of a Market has or is likely to have the effect of:
creating an artificial price for trading in financial products on a Market;
(ii) maintaining at a level that is artificial (whether or not it was previously artificial) a price for trading in financial products on a Market;
(iii) creating, or causing the creation of, a false or misleading appearance of active trading in financial products on a Market; or
(iv) creating, or causing the creation of, a false or misleading appearance with respect to the market for, or the price for trading in, financial products on a Market,
whether or not the Market Participant is aware of:
the intention of any party to the transaction or order; or
(vi) all of the details of the transaction or order,
the Market Participant must, as soon as practicable, notify ASIC in writing of the details of the transaction or order (to the extent known to the Market Participant) and the reasons it suspects the matter set out in paragraphs (a) and, or, (b).
(2) A Market Participant is not required to notify ASIC under subrule (1) if the Market Participant has reported the information that would otherwise be required to be contained in the notification to ASIC under subrule (1) to the Australian Transaction Reports and Analysis Centre under section 41 of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 or under section 16 of the Financial Transaction Reports Act 1988.
5.11.2 Confidentiality
A Participant who notifies ASIC under subrule 5.11.1(1) must not disclose that the notification was made, or the information contained in the notification, to any person other than:
for the purposes of seeking legal advice; or
(b) as required by law.
Part 5.12 Market Bid—Announcements by Market Participant
5.12.1 Announcement of a Takeover Market Bid
(1) A Market Participant acting on behalf of a Bidder in relation to a Takeover Market Bid must announce the bid to the Market where Cash Market Products in the Bid Class have been granted Official Quotation, in accordance with subrule (2).
(2) For the purposes of subrule (1), the announcement must include the following information:
a description of the Bid Class of Cash Market Products in the Target and the total number of Cash Market Products in that Bid Class;
(b) the price offered for Cash Market Products in the Bid Class;
(c) the date of the commencement and conclusion of the Offer Period;
(d) the number of Cash Market Products in the Bid Class that the Bidder had a relevant interest in immediately prior to the announcement (expressed as a percentage of the total number of Cash Market Products in the Bid Class); and
(e) a statement:
as to whether the Bidder will buy Cash Market Products in the Bid Class On-Market before the Offer Period commences and, if so, the maximum number of those Cash Market Products to be bought and the price that will be paid;
(ii) that the Market Bid is an offer to buy all the Cash Market Products in the Bid Class that exist or will exist at any time during the Offer Period for the price offered; and
(iii) that the Offer Period may be extended and the offer price may be increased in accordance with the Corporations Act.
5.12.2 Announcement of variations to a Takeover Market Bid
A Market Participant acting on behalf of a Bidder in relation to a Takeover Market Bid must announce to the Market where Cash Market Products in the Bid Class have been granted Official Quotation, in writing:
an increase to the price offered for Cash Market Products in the Bid Class;
(b) an extension to the Offer Period;
(c) a withdrawal of the Takeover Market Bid;
(d) any other variation to the Takeover Market Bid in accordance with the Corporations Act; or
(e) if the Market Participant ceases to act on behalf of the Bidder.
Part 5.13 Acquisition of Cash Market Products during the Bid Period
5.13.1 Acquisition of Cash Market Products by Bidder
(1) This rule applies to both Takeover Market Bids and Takeover Off-Market Bids.
(2) A Market Participant acting on behalf of a Bidder must not offer to buy on behalf of the Bidder Cash Market Products in the Bid Class On-Market during the Bid Period for a price that varies from the consideration offered under the Takeover Bid unless and until an announcement has been made to the Market where Cash Market Products in the Bid Class have been granted Official Quotation.
(3) For the purposes of subrule (2), the announcement must be made in writing, by facsimile or electronic delivery to the operator of the Market where Cash Market Products in the Bid Class have been granted Official Quotation.
5.13.2 Acquisition of Cash Market Products by another Bidder
(1) Where Cash Market Products are subject to a Takeover Market Bid, a Market Participant acting on behalf of another Bidder, must not buy the Cash Market Products in the Bid Class of the Target on behalf of that Bidder unless and until the Market Participant has announced in accordance with subrule (2):
a Takeover Market Bid on behalf of the person pursuant to Rule 5.12.1; or
(b) an increase in the price offered under a Takeover Market Bid for the Cash Market Products pursuant to Rule 5.12.2.
(2) For the purposes of subrule (1), the announcement must be made in writing, by facsimile or electronic delivery to the operator of the Market where Cash Market Products in the Bid Class have been granted Official Quotation.
Part 5.14 Market Participant acting for Bidder or Issuer
5.14.1 Market Participant to advise seller if acting for Bidder or Issuer
Where a Market Participant:
has an order from the Bidder in relation to a Takeover Off-Market Bid;
(b) has made an announcement to the Market where Cash Market Products in the Bid Class have been granted Official Quotation, on behalf of a Bidder to acquire Cash Market Products under a Takeover Market Bid; or
(c) acts for a company involved in a buy-back under Chapter 2J of the Corporations Act conducted On-Market on the Market where Cash Market Products in the Bid Class have been granted Official Quotation,
the Market Participant must not accept, or transact, an order to sell Cash Market Products in the Bid Class referred to in paragraph (a) or subject to the announcement referred to in paragraph (b) or subject to the buy-back referred to in paragraph (c) unless the Market Participant:
advises the seller that it is acting for the Bidder or that it is acting for the company involved in the buy-back and is thus unable to give the seller advice in respect of the proposed sale; and
(e) does not give the seller any advice in respect of the proposed sale.