mFund wind down and closure

mFund wind down and closure

About this page

ASX has established this page as a resource to help business stakeholders of the mFund Settlement Service (mFund) to find key information about the wind down and closure of the service.

About the closure of mFund

Since launching mFund, there has been a notable shift in investor interest regarding unlisted managed funds which has coincided with a growing demand for Exchange Traded Funds (ETFs).

The market for ETFs has been, and continues to be, strong and the evolution of Active ETFs in recent years has provided a new opportunity for fund managers to bring their open-ended active products to listed markets. ASX will continue to focus on growing the ETF market.

ASX will begin a process of engagement with industry participants impacted by this decision via an Industry Working Group to determine an appropriate transition process. ASX will provide a further update on the timing and next steps after we have engaged with stakeholders.

ASX expects that individual funds will be progressively removed from the mFund platform in tranches up to the proposed closure date of 31 May 2026. This represents a closure notice period of approximately 2 ½ years.

Resources

Key ASX contacts

Please reach out to the ASX Investment Products team if you have any questions.

Andrew Campion

General Manager, Investment Products and Strategy, ASX
Andrew.Campion@asx.com.au

Rory Cunningham

Senior Manager, Business Development, Investment Products, ASX
Rory.Cunningham@asx.com.au

Ashley Parker

Project Manager, Investment Products, ASX
Ashley.Parker@asx.com.au

 

High level wind down and closure timetable

Stage Description Target date Potential milestones (non-exhaustive)
1. Initial wind down Limit expansion of the mFund service & commence industry engagement November 2023
  • Content released on ASX website to assist impacted parties e.g., FAQs.
  • Suspension of new mFund product admissions.
  • Fee relief relating to mFund with respect to broker/PISP transaction fees and issuer fees.
  • Establishment of the Industry Working Group
2. Removal of funds Liaising with mFund stakeholders to convert mFund holdings to direct ownership and remove funds from service. By the end of May 2026
  • Communicate and liaise with individual product issuers and registries to minimise disruption, e.g., synchronising mFund removal with rolling of PDS documents, avoid clashes with fund distribution dates.
  • Determine timing for the cessation of new applications and redemptions to existing mFunds with issuers and brokers. 
  • Removal of funds from mFund and conversion of fund holdings from broker sponsored to issuer sponsored via CHESS.
  • Conversion from mFund products to dual access ETF.
3. Final closure Final stages of legal and operational work to close the mFund service permanently.

By the end of August 2026
  • Removal of references to mFund from ASX website and other relevant sources.
  • Resignation of remaining PISPs and return of Settlement Bonds.

 

mFund Industry Work Group

In response to feedback received from respondents to the consultation, ASX will establish an mFund Industry Working Group (IWG). The objective of the mFund IWG is to help coordinate and facilitate an orderly wind down of the service, and provide an open forum for communication between mFund stakeholders and ASX. 

mFund stakeholders invited to participate in the IWG include the following:

  • mFund brokers i.e. Trading Participants and Settlement Participants accredited for mFund
  • Product Issuer Settlement Participants
  • Product Issuers and/or investment managers with funds admitted to the mFund service

ASX wil host a meeting with mFund business stakeholders to seek preliminary input into the IWG process. Stakeholders that would like to join this meeting of the mFund IWG should respond directly to the calendar invitation here.

 

Converting a fund to an Exchange Traded Product (ETP)

To assist mFund issuers consider if their fund can be converted to an ETP, ASX has prepared the following Preliminary Assessment Questionnaire. Completion of the questionnaire will assist ASX in providing early guidance to prospective issuers on whether a fund can be converted from the mFund Settlement Service and admitted as an Exchange Traded Product (ETP) under the ASX AQUA Product Rules.

Download Preliminary Assessment Questionnaire

Further information about the requirements to be an ETP issuer can be found on the following section of the ASX website.

Information webinar

On 8 February 2024, ASX will hold a webinar to provide details about the ETP admission process and considerations for issuers that may want to convert their fund from mFund to an ETP.

If you would like to register to attend the webinar please click on the link below:

Register for the mFund to ETP Conversion webinar

If you have any question or would like to have an initial discussion with ASX about the process and requirements to convert your fund to an ETP please contact Rory.Cunningham@asx.com.au.

 

Frequently asked questions

Can I continue to settle / redeem my existing customer mFund holdings?

Yes, mFund will remain open for applications and redemptions for products admitted before 27 November 2023 until further notice. No new products will be admitted to the platform after this date.

 

ASX will begin a process to engage with industry participants impacted by this decision to determine an appropriate transition process. Stakeholders will be given the opportunity to provide input into the closure plan and give feedback on proposed closure procedures. Subject to industry feedback, we don’t expect the closure to have full effect until 31 May 2026.
Will ASX CHESS Ops continue to support queries and request relating to existing mFund holdings?
Yes, please contact CHESS Ops via email on ChessSupport@asx.com.au
How do I communicate ASX’s decision to end this service to my clients?

ASX has prepared the following suggested text to assist in your communication with clients.

 

Dear [insert name],

 

We wish to inform you that ASX has decided to discontinue the Managed Fund Settlement Service (mFund).

 

This decision does not affect you in the immediate term and there is no urgent action required. The service will be wound down over an extended timeframe with full closure expected by 31 May 2026.

 

We are working with ASX to ensure an orderly transition and wind down of the service.

 

We will continue to provide further updates on timing and next steps and there will be plenty of time for you to make any necessary adjustments to your portfolio. We will provide further updates and instructions to you as we continue to engage with the ASX.

 

If you have any concerns or would like to discuss potential options for your investments, please reach out to [insert details]. 

 

Regards,

 

Please also refer to the investor-related FAQs.
Can I add new products to the mFund platform?
No, new products will no longer be admitted to the mFund platform.
Can my firm still enter into new mFund transactions? If so, until what date?

Yes, mFund will remain open for applications and redemptions for products admitted before 27 November 2023 until further notice.

 

ASX will begin a process to engage with industry participants impacted by this decision to determine an appropriate transition process. Stakeholders will be given the opportunity to provide input into the closure plan and give feedback on proposed closure procedures. Subject to industry feedback we don’t expect the closure to have full effect until 31 May 2026.
How will ASX communicate the formal wind down plan of this service to my firm?
Formal communication of the wind down plan will occur via ASX Participant notices, email and information posted to this webpage. ASX will begin a process to engage with industry participants impacted by this decision to determine an appropriate transition process.
What will happen to clients who retain mFund holdings up to and beyond the end date of this service?
Clients who wish to retain their holdings beyond the service closure date will be able to hold their units directly with the product issuer (as opposed to on CHESS), subject to any issuer decisions in connection with the future of their funds.
Can I convert existing participant sponsored holdings to issuer sponsored now? 
Yes, this option is available.
Will ASX be communicating to underlying holders regarding the end of this product offering and the impacts to / options for their mFund holdings?
ASX intends to communicate its plans regarding the wind down of mFund with Trading Participants, Settlement Participants, PISPs and product issuers. ASX believes that participants and issuers are best placed to communicate with underlying holders. We will endeavor to provide collateral to support your communication with clients impacted by the closure.
Will there be any fee amnesty with the ASX fees associated with any proposed wind down activities?
Yes, ASX intends to suspend certain participant and issuer fees relating to mFund. As part of its upcoming engagement with industry in relation to the mFund closure, ASX intends to seek feedback on how best to introduce fee relief for affected participants and issuers.