Aug 12 (Reuters) – ASX said on Wednesday a shareholder plans to seek court approval to bring a statutory derivative action against certain former officers and directors of the Australian securities exchange operator over its abandoned blockchain-based clearing and settlement project.
Here are some details:
• Shares of the bourse operator fell as much as 2.5% to A$55.68, posting their biggest intraday decline since July 3.
• The shareholder, Rosherville, has alleged the officers and directors breached their duties in relation to the Clearing House Electronic Subregister System (CHESS) blockchain-based clearing and settlement project and wants to bring the case on behalf of ASX through a statutory derivative action, the company said.
• Under the Corporations Act 2001, a statutory derivative action allows an eligible shareholder or officer to bring legal proceedings on behalf of a company when the company itself is unlikely to do so.
• Court leave is required, and the proceedings are brought in the company’s name for its benefit, generally.
• ASX said there are no allegations against the exchange itself.
• ASX said it will update the market on any further developments.
• The CHESS replacement project, which was meant to modernise Australia’s share settlement system, was paused in November 2022 after an independent review found significant issues with its design and delivery.
• ASX later abandoned the original blockchain-based approach and developed a new replacement plan.
(Reporting by Roshan Thomas in Bengaluru; Editing by Subhranshu Sahu)
