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Clearing and settlement of cash equities in Australia

The clearing and settlement services provided by ASX help reduce counterparty and systemic risk, and provide transaction efficiency and certainty for end investors

The clearing and settlement services ASX provides for cash equities in Australia.

Although largely invisible to market users, clearing and settlement services are critical to the operation of Australia’s financial markets. The clearing and settlement services provided by ASX help reduce counterparty and systemic risk, and provide transaction efficiency and certainty for end investors.

Backed by significant capital and collateral, and overseen by Australian regulators, ASX’s clearing and settlement infrastructure supports the world-class reputation of Australia's financial markets.

ASX is committed to working with its customers and other industry stakeholders in the provision and ongoing development of clearing and settlement services to ensure that the needs of users are met and that these services are aligned with global standards.

The ASX Cash Equities Clearing and Settlement Code of Practice sets out ASX’s commitments to its customers and other stakeholders in managing cash equities clearing and settlement infrastructure and services for the Australian market.  The Code of Practice was updated in October 2016 to align it with the ‘Regulatory Expectations for the Conduct of Cash Equity Clearing and Settlement Services in Australia’ released by the Council of Financial Regulators on 12 October 2016.

An information paper on data governance for CHESS and CHESS replacement published on 4 December 2020 explains ASX’s data governance arrangements for CHESS which will continue to apply under the new system, with only limited updates to the data that is received and how it is managed under the replacement system.  Since the paper explain ASX’s approach to data governance under CHESS generally, it is relevant to Day 1 functionality, the release 1.1 features (electronic acceptance and payment for entitlement offers) that will be included in a future release after Day 1, and any other future releases under the replacement system.