ASX is replanning CHESS replacement implementation timetable
In June, ASX will seek user input on the new schedule that will move the go-live date from April 2021 to a later date.
ASX has earlier today posted an update on the plans regarding the replacement of its Clearing House Electronic Subregister System (CHESS) with a new system based on Digital Asset’s (DA) distributed ledger technology (DLT).
The Exchange is replanning the CHESS replacement implementation timetable due to the uncertainty created by the COVID-19 pandemic. It is also in response to user feedback on timing, requested functionality changes, and the need for ASX to complete aspects of its own readiness.
In June, ASX is set to seek user input on the new schedule that will shift the go-live date from April 2021 to a later date. In the meantime, the target of opening an Industry Test Environment (ITE) in July is retained.
The replan is poised to provide additional time for users to complete their operational readiness activities and to consider the rule changes that accompany the new system. It will also increase the time available for back office software developers to familiarise themselves with key aspects of the new system in a production-like testing environment, and enable them and ASX to complete software development and testing.
ASX Deputy CEO Peter Hiom said: “Right now, in this environment of heightened volatility and activity levels, the industry needs to focus on day-to-day operations. We will therefore wait until June to consult on the new timetable when we expect everyone will have more time to consider the replan and better assess the implications of COVID-19. We will then announce the new schedule”.
“ASX remains fully committed to CHESS replacement. We continue to progress the project, including system development and testing, supporting back office software developers, and assisting users in their readiness activities. The investments we are making in the new system and in distributed ledger technology are for the long-term benefit of the financial services industry and the Australian economy,” Mr Hiom added.
ASX has undertaken extensive consultation with market users over the last three years on the functionality and timing of the CHESS replacement system.
Feedback has been diverse, with some users advocating no delay and others indicating they would like the project extended to give everyone more time to prepare. Users have also requested changes to the functionality of the new system as part of the recently completed consultation process on detailed business requirements. ASX also needs some additional time to complete some of its development and readiness activities. These issues were under consideration by ASX prior to the COVID-19 pandemic.
In recent days, ASX has received further feedback about the ability of users to focus on the CHESS replacement project during this period of heightened volatility and activity levels. With many firms in the industry, including ASX, operating with a large proportion of staff working from home, the ability to participate in coordinated readiness activities later this year is unclear.