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Mifid

Industry associations suggest Q+A on position reporting

Several trade associations, including FIA, EFET, GFMA and ISDA have proposed a questions and answer document to ESMA on position reporting under MiFID II. The document can be found here. If adopted by ESMA, the proposals will help to answer some of the many outstanding points on position reporting, which is outlined in ITS 4. ESMA released a final draft of ITS 4 (see here) a few weeks ago.

Position reports must be submitted by Market Operators, and also Investment Firms. Many energy and commodity traders, who are able to use the Ancillary Activity exemption, will not be required to submit such reports. However they will be required to provide data on the “hedge” status of positions so that the correct breakdown can be reported by the relevant parties.

The Q+A addresses the issue of reporting of the “end client”, a requirement in MiFID II for the reporting party. The Q+A looks at the topic of reporting the end client of a non investment firm, (i.e. the client of the client of the investment firm) and also the issue of reporting of Economically Equivalent OTC contracts, which according to the second MiFID II consultation of the FCA (see here) is not required to be reported by non investment firms.

About avivhandler

Aviv is the Managing Director of ETR Advisory, a niche consultancy focused on energy and commodity regulation. He has more than 20 years of experience in energy and commodity trading, credit, risk and financial technology. He has delivered a series of trading, credit and risk solutions to a wide variety of oil majors, power and gas companies and investment banks. Prior to founding ETR, he was Partner at SunGard Global Services, where he built a Centre of Excellence in European Energy Regulation. Before that, he founded Coherence, a consulting firm specializing in credit risk in commodity and energy trading as well as software product management. The credit practice ultimately became part of Sirius Solutions, where he was the Managing Director of Europe. He has also held management roles at KWI and Iris Financial, among other organizations. Mr. Handler holds a degree in computer science from Imperial College, University of London.

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