Category: European Union Electricity Market Glossary

Published: 11 May 2021

Last Updated: 10 November 2021

 

Name Passing Broker is a broker facilitating deals between a buying and a selling side and then passing the names to both so that they can confirm a bilateral trade without the engagement of the broker. 

 

This service may be provided even though, having brought the investors together, the actual offer or acceptance is not communicated through the broker.

Name Passing Broker can arrange OTC trades on the phone and per emails, however, the kind of assignment this represent may raise some doubts.

 

In the ACER opinion, the Name Passing Broker is not an executive broker (Answer to Question 1.1.2, Frequently Asked Questions (FAQs) on REMIT transaction reporting, 12th Edition, ACER, 30 April 2021).

Answer to Question 1.1.2 Frequently Asked Questions (FAQs) on REMIT transaction reporting, 12th Edition, ACER, 30 April 2021 An example of a broker who is not an executive broker would be a person facilitating deals between a buying and a selling side and then passes the names to both so that they can confirm a bilateral trade without the engagement of the broker.

 
FCA's Perimeter Guidance Manual (Release 50, May 2020 www.handbook.fca.org.uk, p. 9 - 11) presents also the view that the introducers who merely put clients in touch with other investment firms (and nothing more) so that they can provide investment services to those clients are not receiving and transmitting orders - because this, in itself, does not bring about a transaction.

 

But if a person who does more than merely introduce, for example an introducing broker, it is likely to be receiving orders on behalf of clients and transmitting these to clearing firms and therefore may fall within the scope of MiFID.

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