Keeping up with the MiFID IIs, the REMITs, the EMIRs, and all the usual suspects | Part 2/3

November 24, 2017


An interview with Aviv Handler, Managing Director of ETR Advisory

Read part 1 here »
Read part 3 here »


So people need to think through whether there’s a contradiction between complying with, say, REMIT in the energy industry, and GDPR or MiFID II in the personal stuff as well. I’m not sure of whether people have thought about how these issues interact.


“The GDPR applies to every industry, but when it comes to implementing our rules, like MiFID II and REMIT, there’s a certain overlap, and it’s possible to successfully comply with one while breaking the other.”

3) You mentioned that when implementing regulations, like MiFID II and REMIT, there’s a certain overlap and it’s possible to successfully comply with one while breaking the other. What would a possible solution be?


First of all, you have to be mindful of both rules. For example, if you’re sending trader information as part of your MIFID II reporting, you need to make sure that you do that in such a way that doesn’t breach any of the GDPR rules around transmitting, securing, and retaining that data. You might need to store that part of the message in a particular place so as to have it in reach at a certain point.

“These EMIR review changes have a similar issue: although on the surface they do make life easier, it’s not as quite easy as it looks.”

4) You have mentioned that the EMIR reporting changes of the 1st of November 2017 are more significant than previous ones. Why is that so?


In EMIR terms, the market is very focused on the EMIR RTS changes of November the 1st. The fields used for reporting are among the changes. The requirements are relatively well-understood I would say; but there’s a bigger review that was made of EMIR, initially by ESMA, then by the European Commission that resulted in some recommendations to modify EMIR at level 1 (so, at a higher level). The legislative proposed for the EMIR changes is not yet in the Official Journal and will likely go into use in 2019, although some bodies are still commenting on the changes. For the energy industry, there are five significant changes and some of those are quite major, and most of those are major in ways that actually may make implementation easier, rather than harder. These changes are:


a) The removal of the final backloading deadline of EMIR -which was seen as problematic and actually not that useful.

b) Exchange rate derivatives do not have to be reported by market participants, by the clearer.

c) Internal derivative trades do not have to be reported under EMIR, if one of the counterparties is a non-financial; so for energy companies that’s a significant reduction in reporting in general, because most of them tend to be non-financial counterparties.

d) Enforced delegation rule: if a small energy company trades with a big financial counterparty, that financial counterparty reports both sides of the trade.

e) The rules around threshold calculations have been made easier as well.



Read part 1 here »
Read part 3 here »

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