The competition regulator says the JSE’s conduct has impeded the growth of rival exchange A2X. From Moneyweb.
The Competition Commission (CompCom) wants the Johannesburg Stock Exchange (JSE) fined up to 10% of its turnover for what it says is anti-competitive behaviour that has hurt rival exchange A2X.
In a complaint filed with the Competition Tribunal, the commission accuses the JSE – Africa’s largest stock exchange – of exclusionary conduct and wants an order forcing it to amend its rules to make inter-exchange trading easier, and to allow all JSE trades to be executed, cleared and settled on A2X.
Listen: A2X eyes more individual investors [Nov 2023]
Deposing for the commission, senior CompCom analyst Marlon Dasarath says the JSE’s conduct has raised barriers to growth and expansion for new entrants such as A2X.
The other two primary exchanges in SA that facilitate new capital raises – the Cape Town Stock Exchange and the Integrated Exchange – use a different settlement model to the JSE. It requires trades to be settled, meaning funds and scrip change ownership, within three days. This is known as the trade-plus-three settlement system.
A2X is a secondary trading market, meaning it offers a venue for shares already listed on the JSE. It does not accommodate initial public offerings.
A2X competes with the JSE for the same secondary market business, using the same member brokers, clients and products on a trade-plus-three days settlement system.
The CompCom says the JSE relies on entrenched procedures and rules that restrict A2X from competing with it.
At the core of this is the JSE’s broker dealer accounting system, or BDA, which is its back-office accounting and deal management platform. The CompCom says this is insufficiently interoperable with A2X systems.
The JSE mandates the use of its BDA system, which raises barriers to cross-platform trade.
The JSE refuses to combine off-book and on-book trades originating on A2X into a single contact note for execution and conclusion, while bending its own rules and directives when doing the same business for its own benefit, according to the complaint.
Read:
Spar Group lists on A2X [May 2024]
JSE plans overhaul to encourage smaller listings [Apr 2024]
In response to the complaint, the JSE responds that it “has cooperated fully with the commission throughout its investigation” and “denies these allegations in the strongest possible terms”, adding that it has been advised by external legal counsel that the commission’s claims are without merit. (See full response below).
According to the CompCom complaint, the JSE imposes requirements and restrictions on its brokers for reverse matched principal trades (MPTs) originating on the JSE but concluded on A2X. These same restrictions do not apply to MPT trades originating on A2X and concluding on the JSE.
This differential treatment of trade types favours the JSE by creating overly complex and inefficient processes for A2X.
Africa’s largest exchange is enforcing mandatory use of its BDA system, which it refuses to make sufficiently inter-operable with A2X systems, says the complaint.
Read: JSE: Smaller and smaller in a changing market
The JSE justifies this to ensure reliable and accurate information is fed into its Capital Adequacy System, which is critical for risk management and regulatory compliance. This is particularly prejudicial to smaller brokers, who often lack the resources of larger firms.
The JSE’s refusal to share data and enable interoperability raises both capital requirements and operational costs for brokers trading across both platforms.
Though the Financial Sector Conduct Authority (FSCA) has regulatory oversight, much of the day-to-day supervision is left to the exchanges themselves. Brokers active on both exchanges have a choice of where to buy or sell stocks, like Sasol, on behalf of clients. There can be price differences between the exchanges, as well as different fees that would influence the broker’s choice of venue.
The BDA allows the JSE to manage the risk of non-settlement by keeping tabs on brokers’ accounting records.
The CompCom complaint shows the JSE held a 62% market share in secondary trading in December 2024 – well above the 45% market dominance threshold under the Competition Act – compared with A2X’s 38%.
The JSE had 290 listings with a combined market cap of R21.2 trillion in December 2024, against A2X’s 184 listings and a market cap of R10.8 trillion.
JSE response
“The JSE notes that the Competition Commission recently announced on social media that it has referred the JSE to the Competition Tribunal for prosecution. The matter is in the referral stage which is an initial procedural step. The Commission did not provide details in its announcement and posted a non-confidential version of its referral affidavit,” the JSE said in a statement.
“The Commission referred this matter to the Tribunal on 1 October 2025. Since then, the JSE has been liaising with the Commission and the Tribunal regarding the further conduct of the matter.
“The JSE is preparing its plea to the Commission’s referral, which, by agreement with the Commission and the consent of the Tribunal, will be filed in early 2026,” it added.
“Given the nature of these proceedings, the JSE cannot say when or indeed if the matter will proceed to trial.
“The referral arises from a complaint that A2X Proprietary Limited [A2X] submitted to the Commission in October 2022, alleging that the JSE is abusing a dominant market position by engaging in exclusionary conduct concerning the JSE’s broker dealer accounting [BDA] system and matched principal [MP] trade type,” it noted.
‘Full cooperation’
“The JSE has cooperated fully with the Commission throughout its investigation it denies these allegations in the strongest possible terms and has been advised by external legal counsel that the Commission’s claims are without merit.
“The Commission’s referral seeks an order from the Tribunal that the JSE amend its rules relating to the BDA system and the MP trade type, as well as a potential administrative penalty”.
