The basis for enforcement powers in this regard is rooted in the REMIT itself. The respective provisions are as follows:
- According to Article 13(1), first subparagraph, of REMIT, the National Regulatory Authorities of the EU Member States (NRAs) must ensure that the market abuse prohibitions set out in Articles 3 and 5 of REMIT and the transparency obligation set out in Article 4 of REMIT are applied.
- Article 13(1), second subparagraph, of REMIT requires Member States to ensure that, at least as of 29 June 2013, their NRAs have the necessary investigatory and enforcement powers.
Moreover, Recital 31 of REMIT states:
"It is important that the penalties for breaches of this Regulation are proportionate, effective and dissuasive, and reflect the gravity of the infringements, the damage caused to consumers and the potential gains from trading on the basis of inside information and market manipulation. The application of these penalties should be carried out in accordance with national law. Recognising the interactions between trading in electricity and natural gas derivative products and trading in actual electricity and natural gas, the penalties for breaches of this Regulation should be in line with the penalties adopted by the Member States in implementing Directive 2003/6/EC. Taking account of the consultation on the Commission Communication of 12 December 2010 entitled "Reinforcing sanctioning regimes in the financial services sector", the Commission should consider presenting proposals to harmonise minimum standards for the penalties systems of Member States in an appropriate time-frame. This Regulation affects neither national rules on the standard of proof nor obligations of national regulatory authorities and courts of the Member States to ascertain the relevant facts of a case, provided that such rules and obligations are compatible with general principles of Union law."
However, as the ACER's Reports observe (ACER's annual report on its activities under REMIT in 2014, p. 63), the transposition of enforcement and sanctioning powers by Member States at national level may be very diverse.
Among the shortcomings of the REMIT enforcement noted at present are:
- The case statistics for 2014 showed that in a number of cases potential breaches of REMIT could not be sanctioned due to the fact that NRAs still lacked enforcement and sanctioning powers.
- ACER observes, under REMIT there is no harmonisation of penalties that applies pursuant to Directive 2014/57/EU of 16 April 2014 on criminal sanctions for market abuse (Market Abuse Directive, MAD), which currently establishes minimum rules for criminal sanctions for insider dealing, for unlawful disclosure of inside information and for market manipulation in order to ensure the integrity of financial markets in the Union.
- Harmonisation of penalties beyond market abuse breaches under REMIT is also lacking, for instance, for breaches of the registration and reporting obligations under Articles 8 and 9 of REMIT.
- The potential lack of enforcement powers to ensure the compliance of Registered Reporting Mechanisms (RRMs) with the technical and organisational requirements laid down in Article 11 of the REMIT Implementing Acts (Commission Implementing Regulation No 1348/2014 of 17 December 2014on data reporting implementing Article 8(2) and Article 8(6) of Regulation (EU) No 1227/2011 of the European Parliament and of the Council on wholesale energy market integrity and transparency, OJ L 363, 18.12.2014, p. 121).
I am a market participant and I am facing issues with my RRM in relation to reporting of my data to the Agency which can result in the potential breach of my reporting obligations under Article 8 of REMIT. Who should I contact?
In line with the Agency's internal procedures, all technical issues in relation to data reporting should be addressed to the Agency's Central Service Desk by the RRM reporting data on behalf of the market participant. The RRM should apply the ARIS Contingency Plan if necessary. Please note that the Agency does not have the powers to enforce REMIT. Sanctions for the breach of REMIT provisions are defined and enforced at national level by the relevant NRA, pursuant to Article 18 of REMIT.
Questions and Answers on REMIT, Question II.4.50