CHESS Replacement Project - Australian Securities Exchange · 8 ASX CHESS Replacement I...

CHESS Replacement ProjectImplementation & Transition Webinar

18 December 2019

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ASX CHESS Replacement I Implementation & Transition Webinar I December 20192

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Your Participation

966-082-283


Agenda

Changes to the implementation, transition and cutover timeline

Market feedback on implementation, transition and cutover approach

Market feedback & questions on connectivity

Market feedback & questions on account related migration activities

Market feedback & questions on mandatory vs optional classification of new business requirements

Miscellaneous Questions

General Q&A

Next Steps


Presenters and introductions

5 ASX CHESS Replacement I Implementation & Transition Webinar I December 2019

Katie McDermott - General Manager, Equity Post Trade

Fraser Moodie, Senior Manager, Connectivity & Integration, Equity Post Trade

Anne-Marie Fisher-Taylor, Team Leader, Engineering & Architecture, Equity Post Trade

Frederik Van den Weghe, Head of Product, Equity Post Trade

Changes to implementation, transition and cutover timeline

Implementation, transition and cutover timeline


Migration Dress Rehearsals


• ASX flagged the first migration dress rehearsal may coincide with the AFL grand final weekend. This date has now been confirmed, and is a public holiday in Victoria.

• Some working group members expressed concern on the timeframe between the delivery of CDE7 at end of May 2020 and (i) the start of system testing and (ii) connectivity technical accreditation prior to the first migration dress rehearsal.

• ASX therefore nominates the following revised dates for the three migration dress rehearsals:

• In lieu of the changes to the migration dress rehearsals dates, particularly MDR-3, the completion date for Attestation has been moved to 27 March 2021.

Migration Dress Rehearsals Original Dates Revised Dates

Migration Dress Rehearsal #1 26-27 September 2020 21-22 November 2020

Migration Dress Rehearsal #2 21-22 November 2020 6-7 February 2021

Migration Dress Rehearsal #3 TBA February 2021 13-14 March 2021

System Testing and Technical Accreditation


• Revising the dates for migration dress rehearsals also provides scope to reconsider other key milestone dates while taking onboard market feedback.

• ASX therefore proposes the following revised dates for system testing and technical accreditation:

System Testing Original Dates Revised Dates

Optional 1-Jul-20 1-Jul-20

Mandatory 1-Sep-2020 14-Sep-20

Connectivity Accreditation

Commencement 1-Jul-20 1-Jul-20

Completion 30-Sep-20 31-Oct-20

Messaging Accreditation

Commencement 1-Jul-20 1-Jul-20

Completion 31-Oct-20 20-Nov-20

Operational Readiness


• Operational Readiness cannot commence until systems have been accredited

• In lieu of the revised technical accreditation and migration dress rehearsal dates, ASX provides revised Operational Readiness dates below.

• This will provide the market with additional time to complete Operational Readiness activities.

Operational Readiness Original Dates Revised Dates

Optional 1-Sep-20 1-Sep-20

Mandatory 1-Nov-20 1-Dec-20

Completion 31-Jan-21 26-Feb-21

Implementation, transition and cutover timeline


Market Feedback on Implementation, Transition & Cutover Approach

Market Feedback on the overall approach


Reminder on the call to action

• ASX provided a 3 week window (25 October – 15 November) for the market to provide feedback

• Close to 200 working group members dialed into the webinar on 25 October and over 112 subsequently accessed the recording from the CHESS Replacement webpage

Key themes

1. Some expressed concern on the timeframe between CDE7 and the start of system testing and technical accreditation

2. Request for more details on what happens over the cutover weekend for moving to new registration standards

3. How will new Holder IDs be implemented?

4. How will inflight transactions be managed?

5. How is ASX minimising the volume of data to be migrated on the cutover weekend?

Market Feedback on the overall approach


Key themes cont.

6. When will ASX be providing more information on the browser and how does that fit into timeline for Technical Accreditation?

7. There was no push back on the migration dress rehearsal dates (notwithstanding MDR-1 now falls on a Victoria public holiday and the timeframe from CDE7 to the start of System Testing and Technical Accreditation)

• Some asked how a full settlement cycle will be tested post migration of data

8. When will ASX publish a full set of compliance requirements for Technical Accreditation and Operational Readiness and how exactly do CHESS users demonstrate compliance with new message formats?

9. When will ASX publish what new features are to be made mandatory vs optional as this impacts development and testing effort

10. How does Attestation differ between a participant and a software vendor?

11. Will there be multilateral activity and testing in IWT?

Questions

Q&A


• ASX received a number of questions from the webinars held on 25 Octoberr and 29 November

• Some have already been addressed / answered:

• During the webinar

• Offline via email

• Updated FAQs on the CHESS Replacement webpage and/or technical documentation portal

• As part of the key themes addressed in preceding slides

• Some questions have not been addressed to date

• Other questions will be revisited to allow ASX to share key messages where we feel it will benefit the entire working group

Market Feedback and Questions on Connectivity

Market feedback and questions on connectivity



• Connectivity was highlighted as an important topic during the webinar held on 25 October.

• ASX provided a 3 week window (29 November – 13 December) for the market to provide feedback on the topics raised at that webinar.

Key themes

1. Working group members primarily sought further information on the secure browser (specifically around timelines and connectivity).

2. Questions were also asked regarding the application process for Industry Test Environment (ITE).

Q&A – Connectivity


Q: Will we need a separate agreement (and application process) for connectivity to ITE vs CDE?

Q: We ask the ASX to provide clarification on what is deemed a success on Connectivity (eg are we required to maintain continuous connectivity for a set period of time?)

Q: When will functionality of the ASX Browser be published. Can any high level details be provided now? Will the ASX Browser be ready to test at the beginning of IWT?

Q: A statement was made in the session about ASX Net requirements needing to be finalised by December. Is there some process whereby we can confirm that our existing ASX Net set up is suitable for IWT and Prod go-live of CHESS Replacement?

Q: Will we need to sign up to a new SWIFT closed user group (CUG) for ITE and Prod?

Q: If I use iVPN today can I use IPSEC in the future?

Q: When can we start configuring ASX Net for ITE & Prod?

Secure Browser: Account Details View


Market Feedback and Questions on account related migration activities

Market feedback on account related migration activities



• The webinar held on 29 November focused on account details in the new system and account related migration activities

• ASX provided a 2 week window (29 November – 13 December) for the market to provide feedback

• Close to 130 working group members dialed into last month’s webinar

Key themes

1. Request for further information on holder records, stakeholder adoption of the new ISO 20022 standard in account registration details and account conversion.

Q&A – Account related migration activities


Q: How will ASX identify the Primary Account holder for joint holdings?

Q: Will ASX capture beneficial owners in the holder records or just the named party, such as the trustee? For example super funds, will ASX only capture the trustee company?

Q: ASX stated the new format will support up to four joint holders, what about those issuers whose constitution does not allow this?

Q: Will share registries be mandated to clean client records to ensure it meets the new standard? If no, this may be an issue with stock conversions.

Q&A – Account related migration activities


Q: ASX described that for overseas addressees, with the exception of NZ addresses, the conversion will only populate Address Lines 1-3 in the new structure (i.e. Town/State/Postcode will be blank).

Given the Account Modification and Report messages state that the Town is mandatory, how will this affect account registration detail changes and also account messages associated with Conversions, Transfers and SRN enquiries?

Q: As part of the migration, can sponsoring participants provide the ASX a list of holder types, i.e. individual or company to ensure the correct holder type is recorded?

Market Feedback and Questions on Mandatory vs. Optional Classification of New Business Requirements

Market feedback on Mandatory vs. Optional classification of New Business Requirements



• Mandatory vs optional classification of new business requirements was discussed at the webinar held on 29 November

• ASX provided a 2 week window (29 November – 13 December) for the market to provide feedback

Key themes

• ASX received a number of queries in relation to the classification of ‘Mandatory vs. Optional’. Participants sought further guidance as to what ‘mandatory’ means, and how it affects various stakeholders in relation to the new business requirements classified as ‘mandatory’ by 31st December 2021.

Q&A – Mandatory vs Optional classification of New Business Requirements


Business Requirements classified as ‘Mandatory’ by 31 December 2021

• Settlement Locks

• Bilateral demand settlement instructions

• Corporate action DRP elections

• Corporate action Entitlement Offers

Miscellaneous Questions

Q&A – Miscellaneous


Q: Accreditation. A number of questions were received on accreditation, ranging from scope, timing, optionality of messages and optionality of tags within messages.

Q: Is the ASX considering having a trading but non settlement day on the first day after the migration, to allow participants to focus on correct production system operation on day 1, and payment providers on day 2?

Q: While we have yet to utilise, we are concerned the trade tool ingest introduces a requirement to ensure the ‘prices of the Securities are close to the current market price’. Given the vast amounts of testing required we request this restriction is lifted during the IWT phase to streamline the testing process & creation of data for all testing (including volume testing)

Q: When will ASX publish the date for the next webinar and others (with agendas) so that we can plan ahead to have key resources available?

Q: Does the ITE (Industry Test Environment) become Production?

Next Steps

Next Steps


Review and feedback:

• Webinar recording and slides will be published on the CHESS Replacement webpage

• Provide feedback by contacting [email protected] – use “I&T webinar” as the subject heading

• Feedback welcome by COB 17 January 2020

Reminder:• Written submissions requested by 17 January 2020 on the 1st tranche of operating rule amendments• Email [email protected] to notify intentions of bulk cancellation of dormant accounts by end February

2020

Immediate steps following today’s session

Next Meeting:

• Date: Wednesday, 29 January 2020; invitations to follow

• Topic: Inflight transactions

Thank you.

Disclaimer


This document provides general information only. ASX Limited (ABN 98 008 624 691) and its related bodies corporate (“ASX”) makes no representation or warranty with respect to the accuracy, reliability or completeness of the information. To the extent permitted by law, ASX and its employees, officers and contractors shall not be liable for any loss or damage arising in any way (including by way of negligence) from or in connection with any information provided or omitted or from anyone acting or refraining to act in reliance on this information.

© 2019 ASX Limited ABN 98 008 624 691

CHESS Replacement Project - Australian Securities Exchange · 8 ASX CHESS Replacement I...

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