Generally, a person ‘makes a market for a financial product’ if:
(a) they regularly state the prices at which they propose to buy or sell financial products on their own behalf; and
(b) other persons can reasonably expect to be able to regularly buy and sell at those stated prices.
It is not necessary for a market maker to quote both buy and sell prices—a person may still be market making if they quote only the prices at which they propose to buy a financial product, or only the prices at which they propose to sell a financial product.
There is a distinction between making a market for a financial product and operating a financial market. To distinguish between the two, the general test is whether the person operates a facility where the prices for a financial product are quoted on behalf of other persons (operating a financial market) or solely on their own behalf (making a market). However, a person will not be operating a financial market if their conduct consists solely of making or accepting offers on their own behalf, or on behalf of a single person.
Source: Australian Securities & Investments Commission Regulatory Guide 236 ‘Do I need an AFS licence to participate in carbon markets?’ May 2012 (http://asic.gov.au/asic/pdflib.nsf/LookupByFileName/rg236-published-9-March-2012.pdf/$file/rg236-published-9-March-2012.pdf)