The federal government has granted Chi-X Australia a licence to operate an Australian financial market.
As a condition of receiving the licence Chi-X will have to meet the strict conditions associated with operating an exchange covering issues such as resourcing, properly testing its technologic framework, and ensuring a solid and adequate associated compensation fund is set up.
"Since the Government announced in-principle approval of Chi-X in March 2010, ASIC has worked carefully and methodically to develop robust market integrity rules. These rules are designed to ensure the strength and stability of our financial system while allowing vibrant competition from alternative securities trading platforms," Minister for Financial Services Bill Shorten said.
According to the Minister granting a licence to Chi-X will promote competition in domestic financial markets and will further strengthen Australia's position as a financial services hub for the Asia Pacific region.
"Competition in Australia's financial markets is critical to promoting exchange innovation, lowering transaction costs for market participants, leveraging our pool of national superannuation savings, and improving liquidity and access to capital for companies," Shorten said.
ASIC will be working towards facilitating a smooth transition to having to two competing securities trading platforms in Australia through constant contact and communication with both market operators.
