2018-01-09
How can energy companies be affected by MiFID II?

mifid 2According to Art. 1 of the updated Markets in Financial Instruments Directive (2014/65/EU—MiFID II), the directive “shall apply to investment firms … and third-country firms providing investment services or performing investment activities through the establishment of a branch in the Union.”

Pursuant to MiFID II, an “investment firm” means any legal person whose regular occupation or business is the provision of one or more of the following investment services to third parties and/or the performance of one or more of the following investment activities on a professional basis:

(1) Reception and transmission of orders in relation to one or more financial instruments, 
(2) Execution of orders on behalf of clients,
(3) Dealing on its own account,
(4) Portfolio management,
(5) Investment advice,
(6) Underwriting of financial instruments and/or placing of financial instruments on a firm commitment basis,
(7) Placing of financial instruments without a firm commitment basis,
(8) Operation of an MTF,
(9) Operation of an OTF.

Why could an energy company be regarded as an investment firm under MiFID II and how to avoid this?

Most energy companies trade on their own account (regardless of whether they are purchasing energy derivatives/financial instruments) directly or indirectly. 

As a rule, under MiFID II entities dealing in financial instruments on their own account are excluded from the scope of the directive. However, a special regime applies to entities trading in commodity derivatives (including energy derivatives) and emission allowances. Generally, such entities may be exempted from the application of the directive if:

(A) such trading in commodity derivatives is an “ancillary activity” (which is determined in accordance with the formulas provided for in the directive), 
(B) they do not apply HFT (high-frequency algorithmic trading), and 
(C) they notify the regulatory authority that they are making use of the exemption.

The exemption will be available to an energy company also if it conducts investment activities or renders investment services other than trading on its own account, provided that such activities or services relate to commodity derivatives and the above conditions are fulfilled. 

Deadline for applying for exemption

Please note that in Q&A dated October 4, 2017 (ESMA70-872942901-28), the European Securities and Markets Authority stated:
 
“Article 2(1)(j) of MiFID II exempts persons who deal in commodity derivatives on an ancillary basis under a number of conditions. One of these conditions is that they notify annually the relevant competent authority that they make use of this exemption. The notification needs to have been made for a firm to be able to rely on it. 

The first of such notifications must be made by January 3rd of 2018. For 2019 and subsequent years, the notification needs to be made by April 1st of each year. Any firm that has not applied for authorisation has to notify."
It should be noted that there will be sanctions for non-fulfillment of the vast majority of new responsibilities required by MiFID II. In this respect, the directive does not spare the addressees of MiFID II, including investment firms, banks and investment funds, but also a large number of other businesses. The maximum administrative fine imposed on a legal person is at least EUR 5 million or the equivalent in national currency, or 10% of the total annual turnover of the legal person according to the last available accounts.




Dodaj komentarz
Nick/Pseudonim
E-mail (ukryty)
WWW
Treść
Subskrybuj

Powiadamiaj mnie o nowych komentarzach do tego artykułu
E-mail (ukryty)


Bądź na bieżąco

Możesz zaprenumerować ten blog. Wpisz adres e-mail, a powiadomienie o nowym wpisie dostaniesz na swoją skrzynkę. 


O serwisie
  • Prezentujemy i omawiamy prawną stronę elektroenergetyki, gazownictwa, ciepłownictwa i sektora wydobywczego.
  • Śledzimy legislację i komentujemy działania URE i UOKiK oraz największych graczy rynkowych.
  • Analizujemy orzecznictwo krajowe i europejskie dotyczące naszego sektora.
O autorach
Ostatnie komentarze
Milena Kazanowska-Kędzierska komentuje Przedsiębiorco paliwowy, utrzymaj swoją koncesję
Archiwum
2018
Tagi
Poznaj inne nasze serwisy

Blog EuroZamowienia.pl
Blog IPwSieci.pl
Blog kodeksWpracy.pl
Blog PrawoMówni.pl
Blog LepszaTaktyka.pl

Ta strona internetowa używa plików cookies (tzw. ciasteczka) w celach statystycznych oraz dla prawidłowego funkcjonowania strony. Każdy może zaakceptować pliki cookies albo poprzez ustawienia przeglądarki lub wyrażenie zgody poniżej. Możliwe jest także wyłączenie cookies poprzez ustawienia przeglądarki, dzięki czemu nie będą zbierane żadne informacje. Dowiedz się więcej w naszej polityce prywatności.



Akceptuję