The European Securities and Markets Authority (ESMA) has published a new Q&As document on commodity derivatives topics under MiFID II and MiFIR. The Q&As document covers position limits and ancillary activity.
On position limits the Q&As cover a number of important points, including what is a ‘lot’ for energy products and economically equivalent over-the-counter contracts, when securitised derivatives are to be classed as commodity derivatives and the typical features which ESMA considers differentiates them from exchange traded commodities, and how position limits for futures and options should be applied.
Among other things on ancillary activity the Q&As explains how financial instruments which fall under the definition of C6 should be counted when firms calculate the size of their ancillary activities.
View ESMA prepares for MiFID II commodity derivatives regime, 19 December 2016