NSX Limited and Australian Securities and Investments Commission

In the matter of NSX Limited and the Australian Securities and Investments Commission, Deputy President Bernard J McCabe P of the Administrative Appeals Tribunal considered an interlocutory application. The applicant, NSX Limited, a licensed financial markets operator, sought intervention from ASIC under the Corporations Act 2001 (Cth) and Corporations Regulations 2001 (Cth) concerning alleged conflicts of interest faced by ASX Limited (ASXL), the operator of the Australian Stock Exchange. NSX argued that ASXL, as both a market operator and a commercial rival, possessed powers to demand sensitive information from NSX that created specific and significant conflicts with ASXL's regulatory obligations.

The primary legal issue before the Tribunal was whether NSX's circumstances constituted a "specific and significant conflict, or potential conflict that would be specific and significant" as contemplated by Regulation 7.2.16 of the Corporations Regulations. This regulation empowers ASIC to intervene and make decisions under a market operator's rules in such conflict situations. NSX had applied to ASIC for intervention, but a delegate concluded that the threshold for a specific and significant conflict had not been met, leading NSX to seek review in the Tribunal. NSX further sought the Tribunal's determination on two preliminary questions: whether ASXL competed with NSX's business, and if so, whether specific and significant conflicts arose between ASXL's commercial interests and its need to operate the market in accordance with its statutory obligations.

Deputy President McCabe P determined that retaining the proceedings within the Tribunal was the most appropriate course of action, finding ASIC's preferred approach to be too slow and overly cautious, and remittal to be too uncertain. The Deputy President reasoned that the parties were unable to agree on appropriate orders following an interlocutory hearing. Consequently, the Tribunal ordered that the parties participate in an alternative dispute resolution process before an experienced member, ideally before the end of November, with a preliminary discussion to be convened as soon as possible to discuss logistics and potential submissions.