ZAR X has renounced its conditional FSB licence to run a stock exchange, which it said short-circuits the repeated appeals and legal applications by the JSE which could delay its launch.
The ZAR X is a new securities trading platform that is introducing T+0 settlement and clearing and will offer a “user-friendly stock exchange in competition with the long-established monopoly of the JSE”.
ZAR X director Geoff Cook said the conditional licence was initially granted in keeping with recognised practice adopted by international regulators.
“From a practical perspective, a conditional licence is irrelevant to the core process,” said Cook.
“It is not stipulated as a necessary preliminary step in the Financial Markets Act and this is what the JSE objected to.”
Cook said the JSE has stated it welcomes competition, but has lodged objections, appeals, and applications since August 2015.
Cook said this “pattern of delay and obstruction” had gone on so long it amounted to “bad faith”.
The JSE’s legal team recently focussed on the FSB registrar’s right to grant a conditional stock exchange licence.
“By renouncing the conditional licence we clear away any justification for the latest round of delaying tactics.”
“We have complied with all FMA requirements and all procedural and operational points subsequently raised by the FSB.”
ZAR X previously said it intends to be operational by September.