Recommendation 1 Recommendation 2 Recommendation 3 Recommendation 4

Recommendation 5 Recommendation 6 Recommendation 7 Recommendation 8

Market selection

Recommendation 1

Securities Systems* have a primary responsibility to their users** and other stakeholders. They must provide effective low cost processing. Services should be priced equitably.

* Securities Systems = depositories, settlement and clearing systems
** Users = customers of the securities system, and all other parties to whom the securities system owes a duty of care

1.	Is the board that governs the depository answerable to its users?	FASTER: The New Zealand Stock Exchange (NZSE) operates FASTER which is a direct-on-register system and not a depository. It is however functionally equivalent to a depository as it gives participants seamless electronic access to all registers. The NZSE is responsible for FASTER and the board of the NZSE answers to NZSE members and member firms which elect the board. Member firms' direct participants are users of FASTER. Indirect participants are likewise users however they have no representation on the board of the NZSE. NZCSD: The NZCSD is fully owned by the Reserve Bank of New Zealand. The Reserve Bank of New Zealand has a Board which is responsible for the Bank and its subsidiary NZCSD. The Board is answerable to the Minister of Finance.
2.	Does any single organisation, or sector (e.g. brokers, custodians, Stock Exchange) have a large voting position at the board of the depository?	FASTER: NZSE Member firms (brokers) comprise the major representation on the board of the NZSE. NZCSD: Members of the NZCSD are consulted on significant issues that may impact them.
3.	Is there cross subsidisation of products (e.g. international services subsidised by local ones or transaction costs subsidised by asset servicing charges)?	Typically no.
4.	What process is in place at the depository to ensure that it meets the needs of all its stakeholders (e.g. institutions, broker dealers, retail investors, issuers)?	FASTER: Users are owners and elect the board to represent their interests. NZCSD: Austraclear Rules and Operating Guidelines
5.	What is the communications strategy of the depository to its stakeholders and how is this run?	FASTER: Through the NZSE membership structure. NZCSD: The Reserve Bank, as owner of the depository has the following communications strategy: Quarterly newsletter, six monthly user group meetings and annual visits to larger members.