Start date: 11 October 2012
Close date: 22 November 2012
CME Europe Limited (CMEEL) has made an application to the Financial Services Authority (FSA) to become a Recognised Investment Exchange (RIE) under section 287 of the Financial Services and Markets Act 2000.
CMEEL is a UK subsidiary of the Chicago Mercantile Exchange Inc. (CME Inc.) which proposes to establish a London-based derivatives exchange offering foreign exchange (FX) derivatives and expanding into other asset classes over time. CMEEL expects to launch the exchange in mid-2013.
The principal business aims of CMEEL in applying for recognition are to establish, launch and develop a fully operational RIE with an initial suite of FX products which has particular appeal to customers in Europe, the Middle East, Africa and Asia. These products are shown below.
|1||Australian Dollar/US Dollar (AUD/USD)||16|| US Dollar/South African Rand(USD/ZAR)
|2||British Pound/US Dollar (GBP/USD)||17|| Euro/Offshore Chinese Renminbi(EUR/CNH)
|3||Euro/US Dollar (EUR/USD)||18||Euro/Czech Koruna (EUR/CZK)|
|4||Euro/British Pound (EUR/GBP)||19||Euro/Hungarian Forint (EUR/HUF)|
|5|| New Zealand Dollar/US Dollar
|20||Euro/Polish Zloty (EUR/PLN)|
|6||US Dollar/Canadian Dollar (USD/CAD)||21||Euro/Turkish Lira (EUR/TRY)|
|7||US Dollar/Japanese Yen (USD/JPY)||22||US Dollar/Turkish Lira (USD/TRY)|
|8||US Dollar/Swiss Franc (USD/CHF)||23|| US Dollar/Offshore Chinese Renminbi(USD/CNH)
|9||Euro/Danish Krone (EUR/DKK)||24||Euro/Chinese Renminbi(EUR/CNY)|
|10||Euro/Japanese Yen (EUR/JPY)||25||US Dollar/Ukrainian Hryvnia (USD/UAH)|
|11||Euro/Norwegian Krone (EUR/NOK)||26||US Dollar/Brazilian Real (USD/BRL|
|12||Euro/Swedish Krona (EUR/SEK)||27||US Dollar/Chinese Renminbi (USD/CNY)|
|13||Euro/Swiss Franc (EUR/CHF)||28||US Dollar/Indian Rupee (USD/INR)|
|14||US Dollar/Israeli Shekel (USD/ILS)||29||US Dollar/Korean Won (USD/KRW)|
|15||US Dollar/Mexican Peso (USD/MXN)||30||US Dollar/Russian Ruble (USD/RUB)|
CMEEL intends to use CME Globex as its electronic trading platform and CME Clearing Europe Limited [see note 1] is proposed to provide central counterparty clearing services.
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 CMEEL's application; as part of this process, the OFT invites comments from any parties that have an interest in the application. CMEEL's current draft exchange rules and procedures are found at the links below alongside redacted versions of the product transaction module and a template contract specification.
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
2-6 Salisbury Square
London, EC4Y 8JX
Telephone: 020 7211 8506
Fax: 020 7211 8505
Or by email to: email@example.com
The consultation period lasts for six weeks will end at 23:59 on 22 November 2012.
If interested parties are considering responding to this consultation, the OFT would appreciate an indication that this is the case by 25 October 2012.
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.
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