Activity Report 2012 - Eurelectric

FInanCIaL REGULaTIon
EURELECTRIC activities this year focused on three
key pieces of financial regulation, to avoid that their
implementation has unintended negative consequences
for the EU energy market.
In October 2011 the European Commission proposed a
review of the Markets in Financial Instruments Directive
(MiFID). EURELECTRIC has been working to ensure
appropriate and proportionate treatment of EU electricity
companies, which are active on financial markets in a
fundamentally different way than financial companies.
In particular, the previously established exemptions
should continue to apply. Final negotiations are expected
to take place under the Irish Presidency in early 2013.
Another key dossier is the Regulation on over-the-counter
derivatives, central counterparties and trade repositories
(EMIR), which came into force in August 2012. Among
other things, it lays down that OTC derivative contracts
above a certain threshold would need to be cleared
through central counterparties. The threshold, along
26 eurelectric activity report 2012
with several other technical standards, is currently
under discussion. EURELECTRIC is working to ensure that
the Regulation imposes proportionate measures that
recognise the specific needs of electricity companies
and allow them to manage their commercial risk without
affecting the overall aims of reducing systemic risk and
increasing transparency.
Finally, this year also saw an active engagement of
EURELECTRIC on REMIT, the EU Regulation on Wholesale
Energy Markets Integrity and Transparency. Although
it entered into force in December 2011, many issues
remain open, including a lack of clarity on certain
provisions and definitions (i.e. insider trading, market
abuse, market participant, wholesale energy product)
but also the required registration format and the data
reporting framework. This uncertainty could jeopardise
risk management for energy firms. EURELECTRIC has raised
these concerns with ACER and the European Commission.