Position Limit and Position Reporting – Workshop at ETRC

February 10, 2017

 

Every year, ETRC gathers market participants and regulators across Europe to discuss all things regulation and compliance.

On top of the big-picture discussion and guidance, you’ll also be welcome to a more in-depth series of workshops.

This year, one of the focus areas is position limit and reporting and will be covering everything from Identifying contracts affected, “Equivalent” contracts, rolling in OTC trades to what must be reported (and by whom) as well as the technologies which can help.

Running this workshop will be none other than our partners from Capgemini Consulting; who are leading specialists in assisting companies and governments in transform their functions and structures to adapt to the world around them.

 

What makes you qualified to run this workshop? Tell us a bit about your background and what you are currently working on.

 

I’ve been working for more than 5 years in the energy trading and risk management sector now. I am a Manager in the Energy & Utilities branch of Capgemini Consulting and I am part of the energy trading and risk management core competence group. The energy trading and risk management team offers among other things extensive expertise and in-depth experience on different regulatory topics associated with the energy trading industry (MiFID, REMIT, EMIR etc..). Especially regarding MiFID II we have been following the continuous developments very closely. Before working at Capgemini Consulting, I worked for KPMG, in the energy & natural resources department focusing on trading and risk management. Later on, I worked for Ernst & Young also in the energy trading and risk management department.

 

For you, what would be one of the trickiest things regarding MIFID?

 

Looking at MiFID II from an energy trading perspective, the trickiest things are the ancillary exemptions clauses and the associated tests which have been developed by ESMA. Getting to know or specifying when a certain player is subject to what extent or to what part of MIFID II is a crucial part of MiFID II. The potential indirect consequences of MiFID on the specific business model are equally important, however.

 

Is that reflective in what most of your clients come to you for with advice?

 

Definitely, coming from the MiFID I understanding the traditional concern of our clients is the individual applicability to the regulation, followed by the desire to understand the direct regulatory duties associated with the applicability. However, the way of how MiFID II may actually influence the business model itself is usually not on the radar at first. 

 

During the workshop, you’re going to be speaking specifically on position limit and position reporting. When it comes to these areas, what would you say are the most common mistakes people are making?

 

Mistake is a difficult word because the regulation itself isn’t in place yet so it’s more or less ‘mistake’ in a sense of not considering or not taking into account certain parts of the regulation. Especially the multi-venue component as well as the scope of the contracts and market places that are subject to MiFID II represents common issues. 

 

When you’re in an industry which is open to interpretation, there are loads of regulatory bodies or different directives, how do you make sure you have the most accurate information that you know people can trust?

 

Capgemini Consulting offers a widespread and extensive industry knowledge regarding different market regulations. Our ETRM team experts are specialized on different energy trading related regulations and discuss and challenge new developments continuously internally with finance industry colleagues and externally with energy trading clients. We are also in a very close interaction with several market participants from different industries. There’s a very close interchange of internal and external opinions especially looking at MIFID II.

 

Can you please give us a brief overview of Cemil Erdogan’s background?

 

Cemil has been working in the energy trading business since 2009 and is at Capgemini Consulting for 5 years now. He’s a Senior Manager at Capgemini and he’s also part of the energy trading and risk core competence group. He has been working on a wide range of energy trading topics starting from asset backed trading (asset optimization) through regulatory topics as well as on the implementation of individual risk management systems. He has a very in-depth knowledge, not only from the theoretical or academic point of view of MIFID II but also on what a trader, a risk manager, a risk controller and others are concerned with.  Cemil is the initiator and one of the two authors of Capgemini’s “energy trading 2.0” series which is a well-established annual market study on best practices in the energy trading industry.

 

See more:

Capital Requirements Directive – what can you expect at ETRC?  

The consequence of a shift from bank regulation to trading regulation

 

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