Article 2(1) of REMIT generally defines "inside information" as:
- information of a precise nature,
- which has not been made public,
- which relates, directly or indirectly, to one or more wholesale energy products and
- which, if it were made public, would be likely to significantly affect the prices of those wholesale energy products.
Definition for "trading plans" pursuant to ACER guidelines
A systematic method for screening and evaluating wholesale energy products, determining the amount of risk that is or should be taken, and formulating short and long-term investment objectives.
A successful trading plan will also involve details like the type of trading system to be used.
Most plans require the use of various types of technical analysis tools.
However, according to Recital 12 of REMIT, information regarding the market participant's own plans and strategies for trading should not be considered as inside information.
The scope of the notion for "trading plans" and "trading strategies" on the REMIT ground may rise some doubts, thus some guidelines issued in that regard by the European energy sector regulator (ACER) are highly noteworthy (see boxes).
Definition for "trading strategies" pursuant to ACER guidelines
A set of objective rules designating the conditions that must be met for trade entries and exits to occur.
A trading strategy includes specifications for trade entries, including trade filters and triggers, as well as rules for trade exits, money management, timeframes, order types, etc.
A trading strategy, if based on quantifiable specifications, can be analysed on historical data to project the future performance of the strategy..
It may be ambiguous, for example, how to treat an internal order between a single company internal departments' for transaction's execution. Is this an inside information within the REMIT meaning?
To answer this question it is necessary to assess firstly, whether the above internal order (assuming all other preconditions are met) represents an information regarding a trading plan or a strategy - consequently, whether it is an information regarding "a systematic method for screening and evaluating wholesale energy products, determining the amount of risk that is or should be taken..." etc.
In my view it may be doubtful whether a single internal order fully suits into this matrix, however, it is possible that a combination of orders, potentially, and depending on the circumstances of the case, may fulfil this condition.
Nevertheless, such an internal order may, possibly, fully qualify as an information, which must be protected under other set of rules (parallel to REMIT) such as MAD, MAR, exchanges' and trading platform's internal rulebooks, unfair competition law and so on.