ASX Extends Go-live of CHESS Replacement to April 2023 – Regulation Asia


The one-year extension over what was proposed in June reflects a need for more post-trade processing capacity, highlighted by Marchs extreme increases in trading volumes.

ASX has confirmed a new go-live date for the CHESS replacement system as April 2023, a year later than it had proposed, in its response to the consultation feedback, released on Wednesday (28 October).

The consultation on a proposed new implementation schedule was issued at the end of June, setting out key project activities and milestones for system development and testing, user testing, technical accreditation, operational readiness, and operating rule amendments.

In August, ASX said early results of the consultation showed an overwhelming majority of CHESS users could meet a go-live date of April 2022, as proposed in the consultation.

The extension to April 2023 is a response to requests for extra industry testing, more time to prepare for the new system, and additional functionality that will reduce manual processes (e.g. electronic corporate action elections).

Feedback from stakeholders also indicated that Covid-19 continues to have an impact on the industry, including on collaboration, productivity and perceptions of the need to further reduce cutover risk to the new system, ASX said.

The industry also requested substantially more post-trade processing capacity than what had been contemplated pre Covid-19. This is in response to the extreme increases in trading volumes on the ASX platform during the most volatile period of the pandemic in March 2020.

In early March, ASX says daily trading volumes eclipse previous records by approximately 3.5 million trades, compared to less than 0.5 million trades per day historically.

This increase has reset industry and regulator expectations about the possibility of further step increases in daily trading records. The need for the replacement system to scale to much higher processing levels and sooner, is now a Day 1 requirement.

As a result, ASX has adjusted the Day 1 scope and schedule for the CHESS replacement system to target significantly more throughput capacity and scalability, more functionality, more industry testing, and more time for users and ASX to prepare.

The opening of the Industry Test Environments (ITE) have also been deferred, among other changes to the project milestones. ITE1 will now open November 2021 (previously December 2020) and ITE2 will open in April 2022 (previously April 2021).

The response to consultation and implementation schedule are available for download here.

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ASX Extends Go-live of CHESS Replacement to April 2023 - Regulation Asia

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