Corporations Act 2001

CHAPTER 7 - FINANCIAL SERVICES AND MARKETS  

Note: This Chapter applies to a CCIV in a modified form: see Division 4 of Part 8B.7 .

PART 7.3 - LICENSING OF CLEARING AND SETTLEMENT FACILITIES  

Division 2 - Regulation of CS facility licensees  

Subdivision A - Licensee ' s obligations  

SECTION 821A   GENERAL OBLIGATIONS  

821A(1)    
A CS facility licensee must:

(aa)    

comply with standards in force under section 827D or 827DA ; and

(ab)    

do all other things necessary to reduce systemic risk to the extent that it is reasonably practicable to do so; and

(a)    to the extent that it is reasonably practicable to do so, do all things necessary to ensure that the facility ' s services are provided in a fair and effective way; and

(b)    comply with the conditions on the licence; and

(c)    have adequate arrangements (whether they involve a self-regulatory structure or the appointment of an independent person or related entity) for supervising the facility, including arrangements for:

(i) handling conflicts between the commercial interests of the licensee and the need for the licensee to ensure that the facility ' s services are provided in a fair and effective way; and

(ii) enforcing compliance with the facility ' s operating rules; and

(d)    have sufficient resources (including financial, technological and human resources) to operate the facility properly and for the required supervisory arrangements to be provided; and

(e)    if the licensee is a foreign body corporate - be registered under Division 2 of Part 5B.2 ; and

(ea)    

if the licence was granted under subsection 824B(1) (domestic clearing and settlement facilities) - be registered under Chapter 2A ; and

(f)    

if the licence was granted under subsection 824B(2) (overseas clearing and settlement facilities) - both:

(i) remain authorised to operate a clearing and settlement facility in the foreign country in which the licensee ' s principal place of business is located; and

(ii) get ASIC ' s approval under section 821F before that principal place of business becomes located in any other foreign country; and

(g)    

if the licensee, or a holding company of the licensee, is a widely held market body - take all reasonable steps to ensure that an unacceptable control situation does not exist in relation to the body; and

(ga)    

take:

(i) all reasonable steps; and

(ii) if the licence was granted under subsection 824B(1) (domestic clearing and settlement facilities) - all additional steps (if any) prescribed by the regulations for the purposes of this subparagraph;

to ensure that each core officer of the licensee is:

(iii) a fit and proper person to perform the functions of a core officer of the licensee; and

(iv) without limiting subparagraph (iii) - capable of performing those functions, including being competent to perform those functions; and

(h)    take all reasonable steps to ensure that no disqualified individual becomes, or remains, involved in the licensee (see Division 2 of Part 7.4 ); and

(i)    

take all reasonable steps to ensure that no individual against whom an FMI banning order is made does any of the things mentioned in subsection 853N(1) in relation to the licensee in contravention of the order.

821A(2)    

A person contravenes this subsection if the person contravenes a paragraph of subsection (1) other than paragraph (b) .

Note: This subsection is a civil penalty provision (see section 1317E ).