NASDAQ OMX Stockholm AB (NASDAQ OMX Stockholm) application to become a Recognised Overseas Clearing House under s288 & 292 of the Financial Services and Markets Act 2000.
Start date: 10 August 2011
Closing date: 21 September 2011
On 7 June 2011, the OFT received by email from the Financial Services Authority (FSA) an application from NASDAQ OMX Stockholm AB (NASDAQ OMX Stockholm) for Recognised Overseas Clearing House (ROCH) status under sections 288 and 292 of the Financial Services and Markets Act 2000 (FSMA). The application was dated 31 May 2011.
NASDAQ OMX Stockholm is a private limited liability company incorporated in Sweden, where it has its principal place of business. It offers trading and clearing of exchange traded futures and options on Danish, Finnish, Norwegian, Russian, Baltic and Swedish equities and fixed income contracts, and the clearing of customised contracts and commodities and commodity derivatives. NASDAQ OMX Stockholm also operates an exchange for a cash equity market.
As a fully integrated entity in trading and clearing, NASDAQ OMX Stockholm becomes the central clearing party through novation in all transactions and assumes the credit risk of its members and participants. NASDAQ OMX Stockholm secures its obligations by capital resources and collateral received from members and clients.
NASDAQ OMX Stockholm is authorised as a stock exchange and licensed to engage in trading and clearing operations by the Swedish Financial Supervisory Authority (FI). All its operations are subject to the supervision of the FI and the Swedish central bank where appropriate.
While NASDAQ OMX Stockholm currently operates within the scope of an exemption from the need for UK authorisation, ROCH status would give it more flexibility and regulatory certainty in the way it conducts its business related to UK, where it has a large number of members. In particular, NASDAQ OMX Stockholm currently offers clearing to the N2EX market governing and relating to electricity contracts with physical delivery in Great Britain.
Under section 303(3) of FSMA 2000, the Office of Fair Trading (OFT) must report to H.M. Treasury, the FSA and the Competition Commission on whether any of the regulatory provisions or combination of regulatory provisions of an applicant for recognition has a significantly adverse effect on competition. When assessing competition in this context, the OFT is likely to pay particular attention to the applicant's rules on participation criteria and the arrangements for clearing and settlement of trades.
The OFT is currently conducting its competition assessment of NASDAQ OMX Stockholm's application. As part of this process, the OFT, invites comments from any parties that have an interest in the application. NASDAQ OMX Stockholm's rules can be accessed on its website: www.nasdaqomx.com/nordicrules.
If you have any queries regarding the content of this consultation, please contact Praful Depala to whom responses should be sent:
Mr Praful Depala
Services, Infrastructure and Public Markets (FSMA team)
Office of Fair Trading
Fleetbank House
2-6 Salisbury Square
London, EC4Y 8JX
Telephone: 020 7211 8506
Fax: 020 7211 8505
or by email to: praful.depala@oft.gsi.gov.uk
The consultation period lasts for six weeks in total and will end on 21 September 2011. If organisation's are considering responding then the OFT would appreciate an indication that this is the case. If no responses are received by 21 September 2011 the consultation will close. The OFT may, however, exercise a degree of flexibility taking into account the summer holiday period.
Please note that the OFT may choose to refer to comments received in response to this consultation in future publications. If you consider any document or information that you provide to the OFT to be confidential, that document or information should be placed in a separate Annex and marked 'confidential information' at the time that it is provided to us. At the same time, you should also provide a written explanation as to why the document or information should be treated as confidential. All information received is subject to Part 9 of the Enterprise Act 2002.
If you are replying by email, these provisions override any standard confidentiality disclaimer that is generated by your organisation's IT system.
Team leader
John Leaning (020 7211 8533, john.leaning@oft.gsi.gov.uk)
Project Director
John Riley (020 7211 8143, jon.riley@oft.gsi.gov.uk)
Senior Responsible Officer
Sonya Branch (020 7211 8707, sonya.branch@oft.gsi.gov.uk)
Any media enquiries should be directed to a member of our Press Office.
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