Australian Carbon Register

 

The review of the Australian carbon register (a copy as of 12 June 2012 available at http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/carbon-register-120612.pdf/$file/carbon-register-120612.pdf) allows for cursory examination of the way in which Australian financial market participants react to the regulatory developments.

 

Carbon register consists of a few columns containing data on the registrant (including the principal’s place of business), and the four types of authorisation with respect to the financial services to be conducted:

 

- ‘Advice Authorisation’,

 

- ‘Deal Authorisation’,

 

- ‘Make a Market Authorisation’, and

 

- Provide a Custodial or Depository Service Authorisation’;

 

the first three items each being subdivided into specific carbon products covered by the registration (the possibilities in that regard are: Carbon Units, Australian Carbon Credit Units (ACCU), Eligible International Emissions Unit (EIEU).

 

Carbon register evidences that market participants during registration as a rule choose all the above carbon units (for particulars as regards the said units see ‘Eligibility for international emission units under Australia cap-and-trade – hedging exercise for large emitters' risk management structures’.

 

Considering in the first place the above-mentioned type ‘Advice Authorisation’ the review of the Carbon Register makes evident that registering for the ‘Financial Product Advice’ is more popular among market participants than the ‘General Financial Product Advice’ (for criteria for differentiation between General Financial Product Advice and Financial Product Advice click here).

 

With respect to the column ‘Deal Authorisation’ the types of financial services chosen by the registrants include:

 

- Deal in a financial product - Apply for acquire, vary or dispose of financial products on behalf of another

 

- Arrange for a person to deal in a financial product - Apply for, acquire, vary or dispose of financial products on behalf of another.

 

For the definitions of the above of financial services under the Australian financial legislation click here.

 

Market participants registering with the Australian Carbon Register must also determine whether they want to be authorised for ‘Making a Market for a Financial Product

 

It is interesting that the fourth type of financial services authorisation being the provision of custodial or depository service is rather rare taking into account the Australian business  preferences.

 

Carbon Register includes also information on whether the financial services considered relate to retail or wholesale clients (click here for criteria for differentiation between ‘retail’ clients and ‘wholesale’ clients under the Australia financial legislation). In that regard wholesale sentiment is overwhelming.

 

To see further developments in the Australian market in this respect is valuable experience as is highly probable that the European financials will in the near future face similar business choices - applying, however, an equivalent MiFID II financial market framework and terminology.

 

 

 

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