The European Banking Authority(EBA) have launched a data collection exercise, as part of the CRR (Capital Requirements Regulation) rules, asking for data from companies who trade in commodity derivatives. The requesting document can be found here, and press release here. The data will be used to prepare the appropriate regime for the “prudential supervision of investment firms whose main business consists exclusively of the provision of investment services or activities in relation to the commodity derivatives or derivatives contracts listed in points 5,6,7,9 and 10 of Section C of Annex I of Directive 2004/39/EC (MiFID) (‘commodities derivatives firms’)“.
Commodity derivatives firms falling into this category include those who must set up regulated entities (Investment firms) as a result of not being able to claim an “Ancillary Activity” exemption from MiFID II, as defined by Article 2(1)j and RTS 20. Earlier this year, the own funds requirements of CRR were delayed for commodity derivatives firms until 2020.
The document suggests that the EBA will propose differing rules depending on the level of systemic risk exhibited by the firm, as well as size.