The Australian Securities Exchange has confirmed the new go-live date for the Clearing House Electronic Subregister System (CHESS) replacement system has been pushed back until April 2023, with increased project scope and a 12-month extension to the proposed date consulted on mid-year.
The decision comes after careful consideration of the feedback from the 100 organisations that participated in the extensive industry consultation, engagement with regulatory agencies, detailed discussions with our technology partners, and completion of a comprehensive project review, according to ASX.
The consultation revealed that although most users indicated that they could meet the new proposed go-live date of April 2022, many asked for extra industry testing as well as more time to prepare for the new system and additional functionality that reduces manual processes, such as electronic corporate action elections, to be delivered as soon as possible.
ASX highlighted the ongoing impacts of COVID-19 on the industry, in areas including collaboration and productivity, the importance of digitising processes and the need to further reduce cutover risk to the new CHESS system.
In the consultation, the industry also requested more post-trade processing capacity than what had been contemplated pre-COVID-19.
ASX explained that 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.
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.
Dominic Stevens, ASX CEO, said: “ASX has listened to the industry, regulators and its
technology partners throughout this project. It is clear that COVID-19 continues to impact the whole industry, including ASX, and this has evolved what our stakeholders want from the CHESS replacement system.”
“In parallel, ASX has considered how we can reduce delivery risk, enhance the customer experience and continuously improve project execution. Consequently, we have increased the scope of the project and extended the timeline. The result is a programme that provides a significantly enhanced CHESS replacement solution on day 1.”
Stevens added: “The functional scope, capacity, scalability and testing of the CHESS replacement system now being developed is greater. It captures the increased requirements of ASX and the industry, and lowers the risk in delivering them. It is also consistent with ASX addressing the expectations of the regulatory agencies that CHESS is replaced as soon as it can be achieved safely and that the new system meets the market’s needs.”
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