market surveillance nord pool spot as - nasdaq, inc. · areas towards belarus f. special...
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MARKET SURVEILLANCE NORD POOL SPOT AS
Carl Anders Heilmann Lien
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Agenda
Regulatory regime
REMIT
Market Surveillance
Market Conduct Rules Insider trading Disclosure requirements Market Manipulation
Investigations and sanctions
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Regulatory regime
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NVE
Nord Pool Spot AS
Ministry of Oil and Energy
Trading rules
Market Conduct Rules
Cross-border trading license
Marketplace license
REMIT
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Appendix 5: Market Conduct Rules
1. Definitions
2. Specific Market Regulations a. Elspot Market Regulations b. Elbas Market Regulations c. Special Regulations for Trading in the Estonian Electricity Exchange
Area towards Latvia d. Special Regulations for Trading in the Estonian Import area towards
Russia e. Special Regulations for Trading in the Lithuanian Import and Export
Areas towards Belarus f. Special Regulations for Import and Export between Lithuania and
Latvia and between Lithuania and Kaliningrad
3. Product Specifications
4. Clearing Rules
5. Market Conduct Rules
6. Fee Schedule
7. Ethical Guidelines
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REMIT Regulation (EU) no 1227/2011 of the European Parliament and of the
council of 25 October 2011 on wholesale energy market integrity and transparency (REMIT)
Entered into force December 2011 (not implemented in Norway)
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Market Surveillance
Required to have a market surveillance department
Report to Norwegian Water Resources and Energy Directorate (NVE)
REMIT – NPS is obliged to
– Have arrangements in place to identify breaches of the prohibition against market manipulation and of the prohibition against insider trading
– Report possible breaches to the national regulatory authority
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Market Surveillance
Monitors trading activity – Elspot and Elbas – N2EX market
Investigates possible breaches
In order to ensure an efficient market that is attractive to investors it is essential to
– Ensure the independence of employees – Ensure that commercially sensitive information is kept confidential – MS is operated independently from commercial activities of the exchange – Information given to MS is confidential
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Market Surveillance Direct access to information Market data (trading and clearing)
– All orders and trading results from Nord Pool Spot and N2EX
Market Surveillance may request information – From all members – From TSOs
Market Surveillance at NASDAQ OMX Commodities
Fundamental market information
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Market manipulation
Disclosure requirements Insider trading
Prohibition against trading while holding
inside information
Duty to share certain information
with the market
Prohibition against dissemination of misleading information and equivalent
behaviour
The Market Conduct Rules
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Inside Information
..the term “Inside Information” means information of a precise nature which has not been made public, which relates, directly or indirectly, to one or more Products and which, if it were made public, would be likely to significantly affect the prices of those Products
Information regarding the Member's own plans and strategies for trading shall not be considered as Inside Information
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Prohibition against Insider Trading
Members who possess Inside Information in relation to a Product shall be prohibited from: – Using that information by acquiring or disposing of, or by trying
to acquire or dispose of, for their own account or for the account of a third party, either directly or indirectly, Products to which that information relates;
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Disclosure Requirements
Participants have to publish information regarding the following: – Any outage, limitation, expansion or dismantling of capacity
– 100 MW or more for one Generation Unit, Consumption Unit – 100 MW or more for one Production Unit with an installed capacity of 200 MW or more – in the transmission grid that reduce cross zonal capacities by 100 MW or more – In the transmission grid that reduces power feed-in and/or consumption by 100 MW or more
– for the current year and three (3) calendar years forward, including updates of such information;
– Any erroneous or missing Orders in the Elspot market of 200 MW or more; – Any information that is likely to significantly affect the prices of one or more derivatives based on Products if
made public. – Any Inside Information not covered by sub-paragraph (a) to (c) above
All information which shall be publicly disclosed pursuant to this Section 5 shall be publicly disclosed as soon as possible, and no later than 60 minutes after occurrence of the event which leads to the relevant information. Such information shall be publicly disclosed as an Urgent Market Message (UMM)
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Urgent Market Message
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Area
Production Unit
Generation Unit
Available Capacity
Duration
Cause of the event
Occurrence of
information
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Market Manipulation
Transactions or orders – False or misleading signals regarding supply of, demand for or
price of products at NPS – Secures the price at an artificial level
Disseminating information through the media which can give false or misleading signals regarding supply and demand or price of Products
Attempted manipulation is also forbidden
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Good Business Conduct
Orders shall reflect a genuine purchase or sales interest and that all transactions to which the member is a party is genuine
Not improperly influence the price or price structure in the physical markets nor disturb other members access to or participation in the market
Not apply unreasonable business methods
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Report to NVE
Monitoring Investigation of
suspected breach
Further investigation on violation on
laws or regulations
Found breach
Dialogue with market participant
MS makes recommendation for disciplinary sanction
Sanction
Possible breach discovered
Sanction by Nord Pool Spot AS
Board of Directors/ CEO
Sanction
Procedures for disciplinary actions
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Suspects breach REMIT
Report to National regulator
Sanction pursuant to REMIT by national
regulator
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Disciplinary Actions
Non-public warning
Public warning
Violation Charge up to NOK 2,500,000 (two million five hundred thousand)
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Information from MS
UMM
News from MS
Quarterly report – Investigations – News – Sanctions – Statistics – Tips from participants
MCR
Guidelines
Disciplinary actions
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Statistics Investigations from MS
Total 2012 1st quarter 2013
Number of written investigations initiated in the period
127 16
Number of statements of breach issued in the period
50 5
Number of written warnings 0 0
Number of violation charges 0 0
Number of cases sent to authorities 8 2
Number of tips received from members 33 4
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Concluded breaches:
Total 2012 1st quarter 2013
Disclosure requirements
49 5
Market manipulation 0 0
Insider trading 10 0
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Contact
Tel +47 67 10 91 35 (this line is recorded) [email protected] www.nordpoolspot.com
*Correspondance with Market Surveillance is confidential
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