The Commerce Commission has authorised amended by-laws for the Sydney Futures Exchange Clearing House (SFECH).
The Commission advised the applicants, the New Zealand Futures and Options Exchange, the Sydney Futures Exchange and SFECH of its decision yesterday (Monday) evening. Trades in New Zealand are cleared and guaranteed by SFECH.
The amendment to the by-laws requires clearing members to have net tangible assets of A$5 million rather than the previous A$2 million. A condition of the authorisation is that the Commission be notified of any proposal to change the net tangible asset requirement or to impose a net liquid asset requirement.
In December 1993 the Commission authorised SFECH by-laws to be in effect until October 31 this year. The new authorisation has no time limit.
The Commerce Act prohibits arrangements which substantially lessen competition and also prohibits arrangements between competitors which could exclude a rival from a market. However, it also allows them to be authorised if it can be shown that public benefits outweigh detriments to competition.
