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Mifid, Uncategorized

FCA opens hedge exemption applications and publishes more position limit information

The UK’s Financial Conduct Authority (FCA) has opened the “Connect” system which allows Non Financial Entities to apply for hedge exemptions from the MiFID II position limits regime, for contracts under the FCA’s jurisdiction (that is, contracts found on venues in the UK). Links can be found on the commodity derivatives page here. The FCA recently published a guide on how to make the application (see here).

The FCA has also added new information on the contracts on which limits will be set. Previously a list of contracts on which “bespoke” limits will be set was published. There is now more information on this page, which provides a table and spreadsheet not only of the bespoke contracts, but also of the “de minimis” contracts which must be aggregated.

The page also states that some actual limits will be published in October. This follows the agreement made with ESMA by National Competent Authorities that limits can be published directly, rather than waiting for an opinion to be issued by ESMA (see here).

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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