:Australian stock exchange operator ASX Ltd announced on Monday that it will implement a product-based solution provided by TATA Consultancy Services to design and replace its trading, clearing and settlement system.
ASX said it would implement the new platform in two main releases, with the clearing service to be provided in a first release and the settlement and sub-registration services in a second release.
The estimated cost of the first version of the Clearing House Electronic Subregister System (CHESS) project is between A$105 million ($68.33 million) and A$125 million, over several years, the ASX said.
The ASX’s initial attempt to overhaul CHESS was criticized by the Australian Securities and Investments Commission (ASIC) and the Reserve Bank of Australia, with regulators demanding more in-depth reporting on plans to update the 30-year-old software. years.
ASIC had also opened an investigation into ASX’s public disclosures regarding the previous project before it was abandoned.
ASX was looking to replace its aging all-in-one CHESS software using blockchain-based technology, but abandoned the overhaul in November citing dysfunctional management, concerns about the product’s complexity and scalability, and difficulty to find experts to take care of it.
Australia has also passed laws to encourage competition in a bid to break the ASX’s clearing and settlement monopoly.
“It will be critical for the ASX to now focus on engaging with the market on the detailed design of the CHESS replacement program with a realistic and achievable implementation timeline,” ASIC Chairman said. Joe Longo, in a separate statement.
The estimated timeline for implementation of the first version is 2026, and for the second version, 2028 or 2029, the ASX said on Monday, adding that further stakeholder consultation for the next phase of the replacement project of CHESS is expected to begin in the first quarter. of 2024.
ASX has also entered into an agreement with Accenture to provide additional capabilities and capabilities in delivering the project.
($1 = 1.5366 Australian dollars)