NZX competition hopes revived

EYEING AUSSIE: NZX'S all but abandoned aspirations to get a slice of the Australian stock trading market have been gifted a new ray of hope.

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NZX'S all but abandoned aspirations to get a slice of the Australian stock trading market have been gifted a new ray of hope.

Australian Minister for Financial Services Chris Bowen has approved Chi-X as the first market competitor for Australian stock exchange ASX, and confirmed his dedication to open the investment markets up to competition. ASX shares fell to a nine-week low after Chi-X Australia gained the approval.

The announcement came three years after NZX applied for a licence to operate its AXE platform.

It has had almost no response from across the Tasman.

NZX chief executive Mark Weldon previously described the Australian treatment of their application as "disgraceful" and a "complete lack of action and communication". NZX would not comment on the Chi-X announcement, but Mr Weldon previously said the status of the AXE project was "deep freeze".

Spokeswoman Rowan McRae pointed out the organisation had written down the AXE investment in its interim result last year, but thought the project still had business potential.

Mr Bowen said he was unsure of the status of the AXE application and another application from international broking company Liquidnet, but said the applications were not being "pressed".

Supervision of the Australian financial markets was taken out of the hands of ASX last year and the transfer process was due to be completed later this year. Mr Bowen said new market operators could not start until that process was finalised.

The pre-approval for Chi-X would speed the establishment of regulatory guidance for competition, Mr Bowen said.

"If the Australian Securities and Investments Commission advises me that other applicants, whether it be Liquidnet, AXE or any other new participant, meets the requirements to be granted a licence I will grant the licence."

Chi-X Australia was set up in March 2007, a subsidiary of European-based Chi-X Global.

"The decision to support competition is a vital step in the development of Australia as a financial services hub," Mr Bowen said.

- © Fairfax NZ News