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Australian Market Licence

AML requirements

Section 791A of the Corporations Act 2001 (Cwth), as amended by the FSR Act, requires an entity to hold an AML if the entity operates a financial market being a facility through which offers/invitations to acquire/dispose of financial products are regularly made to, and accepted by, Australian investors. Please note that the specific requirements differ between domestic and overseas operators of financial markets.

The definitions and ambit regarding each of the terms used in the provisions are detailed and complex, and require careful analysis. Professional advice should be sought, as there are serious penalties and repercussions for operating a financial market without an AML.

What is the process for applying for an AML?

1. Lodgment of an AML application with ASIC

2. Demonstration of compliance with applicable obligations.

3. Establishment of written Operating Rules.

4. Establishment of appropriate supervisory arrangements to monitor and oversee participant conduct.

5. Establishment of appropriate conflict of interest management procedures

6. Ensure adequate clearing and settlement arrangements in place for trading on the market.

7. Establishment of appropriate enforcement processes and procedures.

8. Establishment of sufficient resources (financial, technological and human) to operate the market.

9. Implement adequate compensation arrangements.

What can Block Legal & Compliance do for AFSL applicants?

1. advise you regarding ASIC requirements and the licensing process;

2. project manage or review your AML Application;

3. draft policies and procedures (including Operating Rules) and/or application proofs;

4. liaise with ASIC to finalise your AML application;

5. provide assistance with compliance with ASIC Policy Statements 172 or 177 (as applicable);

6. provide training and workshops to staff and Boards regarding the process and applicable legal/regulatory requirements;

7. provide specialised assistance in key areas such as drafting of legal, operational and compliance documentation;

8. provide implementation advice and guidance once AFSL is obtained; and

9. provide ongoing compliance oversight and reviews, and training, once AML has been granted.

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