ASIC finalises technology-neutral safeguards for AI and algorithmic trading with an 18-month transition

ASIC has amended Australia’s securities- and futures-market integrity rules to strengthen controls over trading systems and algorithms, including those using artificial intelligence or machine learning. The rules commence on 18 March 2028 after an 18-month transition.[1][2]

The rules apply to trading algorithms regardless of whether they use AI, machine learning or more conventional automation. ASIC’s focus is testing, monitoring and governance of trading behaviour across securities and futures markets.[1]

Scope and implementation

The reforms apply trading-system requirements more consistently to manually entered and automated orders, clarify the false-or-misleading-appearance rule and remove some redundant prescriptions. Market participants remain gatekeepers for orders that reach an exchange.[1]

ASIC is also consolidating guidance from RG 241 into updated RG 265 and RG 266. The regulator says this could reduce the volume of relevant securities guidance by almost 60%, but shorter guidance does not reduce the substantive obligation to evidence testing, change control and supervision.[1][2]

For brokers, the transition period should be used to inventory algorithms, define approval ownership, retain test evidence and establish kill-switch and incident procedures. The final rules do not ban adaptive models; they require firms to manage the risks those models can create.[1][3]

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