ASIC Dark liquidity: Commencement of New Market Integrity Rules

Greg Medcraft ASIC chairman

Greg Medcraft ASIC chairman

ASIC would like to remind market participants of new market integrity rule obligations relating to dark liquidity, that come into effect on 10 November 2013.

The new rules relate to the following areas (with the relevant ASIC Market Integrity Rules (Competition in Exchange Markets) provision in brackets):
• Crossing system transparency – crossing system operators must publish on a website, information about their crossing system (e.g. products traded) (Rule 4A.3.1);
• Crossing system tick sizes – the tick sizes that apply to exchange markets will also apply to crossing systems (Rule 4A.6.1);
• Client opt out – crossing system operators must allow clients to opt out of using their system (Rule 4A.4.4); and
• Suspicious activity in a crossing system – if suspicious activity is identified in a crossing system, it must be reported to ASIC (Rule 4A.5.2)

ASIC has previously released guidance in the form of Regulatory Guide 223 Guidance on ASIC market integrity rules for competition in exchange markets (RG 223), which clarifies ASIC’s expectations of market operators and participants.

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