The notion of "inside information" under REMIT


 

REMIT in Article 2(1) defines 'inside information' as non-public information of a precise nature relating to a wholesale energy product which, if it were made public, would be likely to significantly affect the price of that product.

 

The four constituent elements of the above definition are:

 

- information of a precise nature


- which has not been made public,


- which relates, directly or indirectly, to one or more wholesale energy products and


- which, if it were made public, would be likely to significantly affect the prices of those wholesale energy products.

 

Negative precondition for the classifying the relevant piece of data as inside information under REMIT is when it constitutes market participant's own trading plans and strategies.

 

The first thing to consider is the scope of the notion of "information" under REMIT "inside information" rules. In that regard "information" includes various information required to be made public as well as, more generally, any information that a reasonable market participant would be likely to use in its decision to trade in a wholesale energy product. Such information must be crucial enough to have a potential to significantly affect prices, although no actual price effect is required.

 

ACER suggests the following as useful indicators of whether information is likely to have a significant price effect:

— the type of information is the same as information which has previously had a significant effect on prices,

— analysts' research reports, price reporter publications and opinions indicate that the type of information has a significant effect on prices or

— the market participant itself or another reasonable market participant has already treated similar events as inside information.

 

“Transparency information” vs. “Inside information” and “Regulated information”

 

Criteria for differentiation of terms: “inside information”, "transparency information” and “regulated information” are as follows:

 

Inside-information-remit“Transparency information” means fundamental data information according to Regulations (EC) No 714/2009 and (EC) No 715/2009, including applicable:

network codes, and

- guidelines (see, in particular, Commission Regulation 543/2013 of 14 June 2013 on submission and publication of data in electricity markets and amending Annex I to Regulation (EC) No 714/2009 of the European Parliament and of the Council (OJ L 163, 15.06.2013, p. 1);

 

“Regulated information” means inside information and transparency information.

 

Additional comments on the precise meaning of the above notions brings ACER's document of 23 October 2012.

 

Thus, the concept of "inside information" comprises on the one hand only that transparency information that is likely to have a significant effect on the prices of wholesale energy products, but on the other hand goes even beyond and also includes other information that a reasonable market participant would be likely to use as part of the basis of its decision to enter into a transaction relating to, or to issue an order to trade in, a wholesale energy product, insofar as this information is likely to have a significant effect on the prices of wholesale energy products.

 

This means that transparency information is periodic, structured data subject to the above legal measures, inside information, in turn, can be considered as an ad hoc, structured data that is likely to have a significant effect on price that has not been disclosed to the market. Such a requirement goes beyond the periodic and regular publication of data under the above regulations and may highlight or pre-empt certain transparency data.

 

Inside information may relate to any item of information that is within the scope of the above regulations as well as the following further information insofar as this information is likely to have a significant effect on the prices of wholesale energy products:

- Information relating to the capacity and use of facilities for production of electricity or natural gas, including planned and unplanned unavailability of these facilities;

- Information relating to the capacity and use of facilities for storage of electricity or natural gas, including planned and unplanned availability of these facilities;

- Information relating to the capacity and use of facilities for consumption of electricity or natural gas, including planned and unplanned unavailability of these facilities;

- Information relating to the capacity and use of facilities for transmission, including planned or unplanned unavailability of these facilities;

- Information relating to the capacity and use of LNG facilities, including planned and unplanned unavailability of these facilities;

- Information required to be issued in accordance with legal or regulatory provisions at Union, or national level;

- Information required to be issued in accordance with Market Rules;

- Information required to be issued in accordance with contracts;

- Information required to be issued in accordance with customs on the market;

- Other information that a reasonable market participant would be likely to use as part of the basis of its decision to enter into a transaction relating to, or to issue an order to trade in, a wholesale energy product.

 


 

RIS

 

It is useful to note that in line with the above architecture the "Regulated Information Services (RIS)" have been designed (RIS meaning persons registered by the ACER to provide the service of reporting regulated information according to Article 8(5) of REMIT to the Agency on behalf of market participants in accordance with the Agency's certification criteria). 

Thus the following types of RIS are distinguished:

 

- Platforms for the disclosure of inside information according to Article 4(1) of REMIT on behalf of market participants ("inside information platforms") providing the Agency with inside information according to Article 8(5) of REMIT simultaneously with the disclosure of the information according to Article 4(1) of REMIT;

 

- A European Transparency Platform from ENTSO-E or ENTSO-G (European Transparency Platforms) according to Regulations (EC) No 714/2009 and (EC) No 715/2009, including applicable guidelines and network codes, fulfilling the respective requirements of the relevant transparency guidelines and reporting to the Agency transparency information simultaneously according to Article 8(5) of REMIT with the publication of the transparency information;

 

- Platforms for the publication of transparency information according to Regulations (EC) No 714/2009 and EC (No) 715/2009 ("transparency platforms") providing the Agency with individual non-aggregated information according to Article 8(5) of REMIT insofar as not already reported through a European Platform.

 

The more precise explanation of the ACER's approach for reporting of the inside information through RIS is contained in the above-mentioned document of 23 October 2012.

 

It follows that the Agency 'believes that inside information should be reported through RISs. Where platforms for the disclosure of inside information already exist, and such platforms would fulfil applicable technical preconditions on data security and operational reliability, the existing platforms, besides disclosing such information to the public on behalf of the market participants concerned, could also be used for reporting inside information to the Agency. In that case, market participants would only have to report the inside information once to the RIS platform that would both disclose the information publicly and report it to the Agency.'

 

In turn, with respect to perspectives for the European ENTSO-E and ENTSO-G transparency platforms ACER in the document of 23 October 2012 ("Recommendations to the Commission as regards the records of wholesale energy market transactions, including orders to trade, according to Article 8 of Regulation (EU) No 1227/2011") expressed the following opinion:

 

'The Agency acknowledges that such unique European platforms have their merits. However, setting up and further developing European platforms for electricity and gas will require significant resources and will take time, whilst REMIT obligations already apply as regards disclosure of inside information and possibly may already apply as regards reporting such data. Accordingly, at least at an initial stage, the Agency considers reporting through national or regional platforms more likely.'

 

As ACER reports in its annual report on REMIT, currently only a few national or regional platforms for the disclosure of inside information exist. Only four national regulatory authorities (NRAs) stated that there is a platform solution available for both electricity and gas in their Member State, while an additional four NRAs reported that there is a platform for either electricity or gas. 18 NRAs reported that there is still no platform available for inside information in their Member States.

 

The majority of NRAs consider publication through platforms as the preferred option for publication of inside information.

 

  

Last Updated on Monday, 21 March 2016 23:28
 

Search

Copyright © 2009 - 2017 Michal Glowacki. All rights reserved.
The materials contained on this website are for general information purposes only and are subject to the disclaimer