Please insert at least 3 characters

FAQs on transaction reporting – Question II.2.3.8

For Exchange Traded Commodity Derivatives only, executed by an executing broker and cleared at a clearing broker. From the end client’s point of view only:

  1. Can ACER confirm that if an underlying client is not a REMIT market participant, then they themselves have no reporting obligation?
  2. Can ACER confirm that if an underlying client has registered as a REMIT market participant, however only executes cash settled derivatives, with no ability to make or take delivery and is not a direct exchange member, they would not be considered market participants for the purpose of reporting these trades only and themselves would not have a reporting obligation?
  3. Can ACER confirm that if a client is a REMIT market participant, which has a reporting obligation, but does not clear through an EMIR regulated clearing broker, or have any reporting obligations under EMIR, they can place reliance on the fact that the beneficiary will be reported by the Executing broker on their transaction report via the OMP?

Answer:

With regard to point (1) if the executing broker’s client is not a market participant there is no obligation to report REMIT transactions. The obligation to report REMIT transaction is on REMIT market participants. Please see Q&As on REMIT document, Questions II.4.2, II.4.43, and II.4.47

With regards to point (2) the question may apply to two different scenarios:

(a) if an underlying client has registered as a REMIT market participant, it means that they enter into transactions, including the placing of orders to trade, in one or more wholesale energy markets.

If the client executes cash settled derivatives, with no ability to make or take delivery and is not a direct exchange member, the client has to report all their transactions including cash settled derivatives because the client is a market participant in a first place.

(b) if an underlying client has registered as a REMIT market participant, but does NOT enter into transactions, including the placing of orders to trade, in one or more wholesale energy markets, that client should not have registered as REMIT market participant and therefore, as indicated in the TRUM ANNEX II: “a client of an exchange member that places orders to trade on the order book of the venue to trade EU gas or electricity derivatives for financial settlement or it is equivalent (e.g. trading on futures for the physical delivery without having arrangements to take or make the delivery of the commodity) should not be considered a market participant unless the client of the exchange member is itself a member of the exchange for the purpose of this trade.”

With regard to point (3) if a client is a REMIT market participant, which has a reporting obligation, but does not clear through an EMIR regulated clearing broker, or have any reporting obligations under EMIR, as indicated in the TRUM Annex III “market participants should report transactions under REMIT only if those transactions are not reported under EMIR …….”  they may place reliance on the executing broker reporting the client’s ID as beneficiary in filed (8) on executing broker’s transaction report reported by the OMP (or third party RRM), or alternatively report a back to back transaction between the client and the executing broker.

It is worth noting that there may be some ETDs traded on EU venues by non-EU counterparties that are not reported under EMIR (e.g. U.S. counterparties reporting under the Dodd Frank Act). The Agency understands that these trades have to be reported under REMIT and, if not reported under EMIR, have to be reported through the Organised Market Places or third party RRM reporting on their behalf.

Last update: 14/12/2016   RSS_Icon Subscribe to this Page’s RSS