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EEX approves changes to rules & regulations regarding MiFID II and introduction of new products

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The Exchange Council European Energy Exchange (EEX) has approved and confirmed all necessary changes to a number of rules and regulations to ensure that the Exchange is fully compliant and prepared for the introduction of MiFID II, which comes into effect on 3 January 2018.

In particular, the Council approved the legal framework to facilitate the transition from Non-MTF trading to the new Organised Trading Facility (OTF). The application for OTF status is currently ongoing and is expected to be granted by the Exchange’s supervisory authority when MiFID II regulation comes into effect.
 
The Exchange Council also approved the introduction of Liquid Milk Futures. EEX is now widely recognised to be the most important trading venue for dairy risk management instruments in Europe and has received numerous requests from market participants to install a hedging instrument for liquid milk. In addition to the existing dairy derivatives (futures for skimmed milk powder, butter and whey powder) this contract would enable market participants to more effectively hedge their respective price risk in liquid milk. The Council agreed that the new Liquid Milk future, which is due to launch in the first half of 2018, will complement the Exchange’s existing dairy portfolio which will in turn, further expand the dairy market at EEX.
 
The Council has also approved the introduction of additional short term power futures for the Netherlands and Eastern-Europe in recognition of the increasing trend towards short term trading in the European power derivatives market. EEX has actively responded to this trend by gradually extending its short-term power future portfolio in several market areas over the past years and today, EEX provides short-term power futures (Day and Week Futures) in 11 of the 17 power derivatives market areas across Europe. In order to further support market development, EEX aims to gradually enlarge its short-term product portfolio with a number of cash-settled futures during the first half of 2018. The new contracts will include; Dutch Peak Week Futures, Dutch Power Day Futures (Base and Peak), PXE Czech Power Day Futures (Base and Peak), PXE Hungarian Power Day Futures (Base and Peak) and PXE Romanian Power Week Futures (Base and Peak). The launch of these additional short-term contracts is in line with EEX’s strategy to enlarge its current product offering and is done so in close coordination with its market participants.
 
Finally, the Council has elected Pierre Chevalier as the new member of the EEX Exchange Council, following the resignation of Le Bouhellect in August 2017. The election is in accordance with Art. 19 (2) of the Saxon Exchange Act Execution Ordinance (SaechsBoersDVO). Chevalier, who has previously been active in the Exchange Council of EEX, has a wealth of experience in the financial sector and is currently employed as Head of Energy Trading, Portfolio/Risk Management at DB Energie GmbH.
 
The Exchange Council of EEX is an official body of the exchange under the German Exchange Act. It consists of a total of 24 members who expertly represent the various relevant interest groups and business circles. In addition to the trading participants who are represented by 19 elected members from five different voting groups, four representatives from associations and one representative of energy science belong to the Exchange Council. The tasks of the Exchange Council include the formulation of the rules and regulations of the exchange and their amendments. The Exchange Council is also tasked with the supervision of the Management Board of the Exchange and the appointment of the Head of the Market Surveillance.

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