ASIC has also included a framework for the regulation of derivative trade repositories, or data warehouses that maintain electronic records of derivative transactions.
“This is a major step for Australia in its implementation of reforms to the OTC derivatives market,” ASIC Commissioner Cathie Armour said. “This regime is designed to better enable regulators to identify systemic risk concerns and potential market abuse, by enhancing the transparency of information to regulators and the market.”
The reporting rules establish which entities and what information will need to be reported. They also set out the obligations and requirements of different entities and different instrument types.
In terms of the derivative trade repositories, ASIC explains, among other things, how to apply for an ASIC derivative trade repository (ADTR) licence, what information is needed, and how institutions that have been granted a licence should operate.
There is a different framework for those derivative trade repositories that are overseas operators, and the reforms are aimed at ensuring international consistency and enabling global markets to be well integrated with different Australian OTC derivative actors and infrastructures.
The information has been released on a dedicated section of the ASIC website. However, the regulator will be adding further clarification in the coming weeks. End users of OTC derivatives are not covered by the new reporting regime and ASIC will consult on their obligations later this year.
