Revised REMIT brings new obligations for market participants: ACER addresses algorithmic trading notifications
Revised REMIT brings new obligations for market participants: ACER addresses algorithmic trading notifications
What is it about?
The Regulation on Wholesale Energy Market Integrity and Transparency (REMIT) aims to prevent and protect consumers and businesses against market abuse in the European electricity and gas markets. The rules were revised in May 2024 to ensure they keep pace with evolving market dynamics.
In April 2024, ACER addressed several questions from stakeholders to help them comply with their reporting obligations under the revised REMIT, before it entered into force.
As a follow up, ACER now clarifies (in an open letter) the obligations for market participants to notify national regulatory authorities and ACER on their usage of algorithmic trading and direct electronic access.
What is algorithmic trading?
Algorithmic trading involves using computer algorithms to automate trades at high speeds, while direct electronic access allows persons to trade directly on organised market places using another entity’s trading code or infrastructure.
Why is the open letter relevant?
Today’s open letter provides examples of activities that fall under the new notification obligations for algorithmic trading, helping market participants comply with the revised REMIT (Article 5a).
These notifications will reinforce regulatory oversight, ensure market transparency, and help manage risks associated with advanced trading methods.
ACER invites market participants to review both open letters and ensure they meet the new obligations.
What are the next steps?
In September 2024, ACER intends to publish an open letter to clarify the obligations detailed in Article 9 (1), which require that non-EU market participants must designate their representative in the EU, as well as the obligations for persons professionally arranging or executing transactions (Article 15).
By the end of 2024, ACER aims to revise the existing ACER Guidance on the application of REMIT to incorporate the changes introduced by the revised REMIT.