Australian equity markets get a whiff of competition at last? April 5, 2010
Posted by James Webster in : finance , add a commentI’ve not blogged much at all lately, and much less so about the issue of competition in Australian equity markets. However with the news that Financial Services Minister Chris Bowen has given ‘in principle’ support to Chi-X’s application for an Australian Markets License we might see some movement sooner rather than later. More from The Australian and Finextra. The AFR has a good article about this too… alas its behind a paywall.
This all first kicked off in 2007… then the GFC/credit crunch came along and adding a competition angle to markets that were in freefall was clearly off the agenda!
Now that it is ‘game on’ again, it will largely be how quickly ASIC can take on the market supervision role formerly played by the ASX that determines how soon Chi-X goes live. At least their technology is getting in place; they are adopting SMARTS‘ platform for market surveillance, a number of former colleagues of mine work there so that bit at least is in good hands!
There is also the issue of Chi-X and ASX coming to an agreement on the fee to be paid for access to ASX’s clearing & settlement network… possibly a separation of ASX Austraclear from the market side of ASX might be on the agenda in the future. Or possibly not; successive Australian governments (of both flavours) have failed to address the issue of Telstra’s conflicting roles as both wholesaler and retailer with serious break-up talk so addressing these sort of monopolistic issues is not a hot issue.
Scott Riley of the Clearing and Settlement blog also has some links on the matter.
Interestingly AXE ECN, the first proposed alternative to ASX, appears to have gone quiet.