Document ID: chunk:federal_register_of_legislation:F2024L00683:body:0:p2
Version: federal_register_of_legislation:F2024L00683
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accordance with the SSF Standards in order to promote overall stability of the Australian financial system. Primary responsibility for the design and operation of a securities settlement facility in accordance with the SSF Standards lies with a CS facility licensee's board and senior management.

How a Licensee Meets the SSF Standards

Each SSF Standard comprises a list of requirements that, through the operation of section 821A of the Act, are binding on, and must be met by, a CS facility licensee that operates a securities settlement facility. To comply with an SSF Standard a CS facility licensee must comply with the headline standard (in bold type) and each of the 'sub'‑standards listed under the headline standard. The SSF Standards are to be interpreted in accordance with their respective objectives and by looking beyond form to substance. In interpreting the SSF Standards, the word 'should' is to be treated as indicating a requirement upon the securities settlement facility to take the relevant action, unless otherwise agreed by the Reserve Bank. The Reserve Bank may, from time to time, issue guidance containing further information on specific aspects of the SSF Standards.

Where the requirements in the SSF Standards and those of the Act and Corporations Regulations 2001 are inconsistent, the requirements of the Act and Corporations Regulations will prevail to the extent of such inconsistency.

Note: The SSF Standards are based largely on the Committee on Payment and Settlement Systems (CPSS) and the Technical Committee of the International Organization of Securities Commissions (IOSCO) Principles for Financial Market Infrastructures (FMIs) (the Principles) and associated key considerations.[1] The Reserve Bank has, in parts, added to and amended the text of the Principles and associated key considerations.[2]

SSF Standards

Standard 1: Legal basis

A securities settlement facility should have a well-founded, clear, transparent and enforceable legal basis for each material aspect of its activities in all relevant jurisdictions.

   1.1 A securities settlement facility should be a legal entity which is separate from other entities that may expose it to risks unrelated to those arising from its function as a securities settlement facility.

   1.2 The legal basis should provide a high degree of certainty for each material aspect of a securities settlement facility's activities in all relevant jurisdictions.

   1.3 A securities settlement facility should have rules, procedures and contracts that are clear, understandable and consistent with relevant laws and regulations.

   1.4 A securities settlement facility should be able to articulate the legal basis for its activities to the Reserve Bank and other relevant authorities, participants and, where relevant, participants' customers, in a clear and understandable way.

   1.5 A securities settlement facility should have rules, procedures and contracts that are enforceable in all relevant jurisdictions. There should