As the latest version of the ACER's reporting guidelines acknowledges, the client participation in the trading venue not involving a membership does not entail a reporting requirement for the client under REMIT.
Annex III to the Trade Reporting User Manual (encompassing issues involved with the reporting of energy derivatives contracts under REMIT and EMIR) has been updated by the Ljubljana-based Agency for the Cooperation of Energy Regulators (ACER) on 6 October 2015.
The current version 2.0 of the said manual has extended ACER's clarifications, which now cover also instances of client participation in the trading venue.
It occurs, the type of participation in the trading venue decisively influences on by whom REMIT order report must be submitted, not to mention the impact on the report content.
ACER clarifies this point using an example: Client (A) is not a member of the venue, but uses the trading systems of an Exchange Member (EM) to trade on the Central Limit Order Book (CLOB).
In this particular case, the Agency believes that Client (A) is currently not considered a REMIT market participant entering into transactions which are required to be reported to the Agency in accordance with Article 8(1) of REMIT, unless it enters into transactions, including the placing of orders to trade, in one or more wholesale energy markets (e.g. any other wholesale energy market).
"For derivatives related to EU wholesale gas or electricity products that are only for financial settlement, only the person entering into the transactions in the EU gas or electricity derivatives traded on venues, via its own trading membership, is the REMIT market participant for the purpose of reporting.
For example, a client of an exchange member that places orders to trade on the order book of the venue to trade EU gas or electricity derivatives for financial settlement or it is equivalent (e.g. trading on futures for the physical delivery without having arrangements to take or make the delivery of the commodity) should not be considered a market participant unless the client of the exchange member is itself a member of the exchange for the purpose of this trade.
However, if that person also enters into transactions, including the placing of orders to trade, in one or more wholesale energy markets, e.g. enters on a physical trade (or its derivative) for the delivery (or transportation) of gas or electricity in the EU, that person is a market participant and has to report all the transactions on wholesale energy products including those trades that are only for financial settlement.
Market participants should bear in mind that the meaning of entering into transactions in EMIR is different than the meaning of entering into transaction in REMIT, where the latter refers to entering into transaction in "wholesale energy markets" and not to be counterparty to a contract, as CCPs or clearing members are."
Annex III to the Trade Reporting User Manual, version 2.0, p. 2
In this case the Exchange Member (EM) is the Market Participant and the (EM) shall report the transactions.
The above rules do not apply when Client (A) has its own membership of the exchange, but uses the trading systems of an Exchange Member (EM) to trade on the Central Limit Order Book (CLOB). In this particular case, the Agency believes that Client (A) is a market participant and has the obligation to report its transactions.
The above delineation has also an effect when it comes to the way Fields 1 and 3 of the order report are to be populated.
In the latter of the above instances, Field 1 of the order report (designated for the "ID of the market participant or counterparty") will be populated with the Client(A)'s ACER code(or other code), while in the former - with the Exchange Member's ACER code (or other code).
Furthermore, Field 3 - to be populated with the "ID of the trader and / or of the market participant" - would be, analogously, filled in with data relating to either the Client (A)'s Trader ID, or the Exchange Member's Trader ID (or Client (A)'s Trader ID if available).
Given the fact, REMIT reporting comes with costs and operational burdens, which ensue - depending on the formula - on different parties, the regulator's interpretation at issue will feed into the overall business costs' assessments where specific forms of market access are analysed.
See more on the The notion of "market participant" under the REMIT Regulation