Tags: AS | Australia | Stock | Market

Australia Approves Stock Market Competitor

Wednesday, 31 March 2010 06:56 AM

Australia is ending its stock exchange's monopoly and has given approval in principle to a unit of Japanese brokerage Nomura to open a second exchange in a move to spur development of the industry, the financial services minister said Wednesday.

Australia needs to open its share market to competition in order to develop into an Asia-Pacific financial services hub, said the minister, Chris Bowen. He said more competition also should cut costs for 6 million Australians who own shares directly or through pension funds.

"If Australia seriously wants to be considered as a financial center, if we seriously want to be regarded as a global financial services hub, then the days of having a monopoly in our capital and financial markets need to come to an end," Bowen told reporters.

Plans call for the second exchange to be set up by an Australian subsidiary of Chi-X Global Inc., a unit of global broker Instinet, owned by Nomura Holdings. Chi-X Global operates markets in Europe and Canada.

Bowen said Australia's regulator, the Australian Securities and Investments Commission, will take over supervision of the Australian market this year from monopoly holder Australian Securities Exchange Ltd., known as ASX Ltd., while Chi-X Australia Pty. Ltd. settles in.

Bowen said a final decision on Chi-X's license will be made after the necessary regulatory framework was in place and other requirements had been met. He said the in-principle approval allowed the regulator to prepare guidance for competition and permits detailed negotiations on how the second exchange will operate.

"I have received advice from ASIC that Chi-X is well on its way to meeting the legislative requirements necessary to be granted an Australian license," the minister said in a statement.

Bowen said other companies had applied for licenses: Liquidnet Australia Pty. Ltd., a subsidiary of U.S. company Liquidnet Holdings Inc., and AXE ECN Pty. Ltd., which is owned half by New Zealand Exchange Ltd., that country's national stock exchange, and half by Australian companies.

"My understanding is that neither of those applicants is pressing their application at the moment," Bowen told reporters.

ASX stock fell 1.71 percent to an eight-week low on 34.43 Australian dollars ($31.69) in early trading after the government announcement.

© Copyright 2019 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

   
1Like our page
2Share
Headline
Australia is ending its stock exchange's monopoly and has given approval in principle to a unit of Japanese brokerage Nomura to open a second exchange in a move to spur development of the industry, the financial services minister said Wednesday.Australia needs to open its...
AS,Australia,Stock,Market
367
2010-56-31
Wednesday, 31 March 2010 06:56 AM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved