Separate dark pools licence proposed in HFT crackdown
A Treasury options paper that looks at reforming Australia's financial market licensing regime includes a proposal for implementing tailored or multiple licences so dark pools would be classed separately to public exchanges.
'Australias Financial Market Licensing Regime: Addressing Market Evolution includes two main options; the first would create flexibility in the Corporations Act allowing the Minister for Financial Services and Superannuation, Bill Shorten, to tailor licence obligations for each market type and decide which obligations should and should not apply.
The second option proposes multiple licence classes for dark pools and public exchanges, each with different obligations, similar to the arrangements currently in place in the US and Europe, according to a Treasury statement.
"The current licence approach was based around large public exchanges, like the [Australian Securities Exchange]. Australia's licence regime should be able to accommodate these new market developments such as dark pools, and should be flexible enough to properly regulate any additional market types that may emerge in the future," Shorten said.
The Government is looking to introduce appropriate rules to govern high frequency trading and to ensure those rules can be enforced to protects markets and investors, Shorten added.
Submissions to the paper close on 1 February 2013.
Recommended for you
With the final tally for FY25 now confirmed, how many advisers left during the financial year and how does it compare to the previous year?
HUB24 has appointed Matt Willis from Vanguard as an executive general manager of platform growth to strengthen the platform’s relationships with industry stakeholders.
Investment manager Drummond Capital Partners has announced a raft of adviser-focused updates, including a practice growth division, relaunched manager research capabilities, and a passive model portfolio suite.
When it comes to M&A activity, the share of financial buyers such as private equity firms in Australia fell from 67 per cent to 12 per cent in the last financial year.
