In December 2007, the Commission issued a joint mandate to the Committee of European Securities Regulators (CESR) and the European Regulators’ Group for Electricity and Gas (ERGEG) requesting joint advice on issues concerning record keeping and transparency of transactions in electricity and gas supply contracts and derivatives in the context of the Third Energy Package. Advice was also sought on a possible clarification of the scope of the Market Abuse Directive in relation to trading in energy and energy derivatives, in the context of the review of that Directive by the Commission to be completed in early 2009.
CESR and ERGEG have now published a joint consultation paper on market abuse issues relating to energy trading. In the joint consultation paper ERGEG and CESR advise the European Commission to explore a tailor-made EU market abuse framework for the electricity and gas sector, and note that there are substantial interdependencies between electricity and gas markets and some other markets, such as emission allowances, coal and oil markets. Trading in these markets is to a large extent conducted by the same market participants. CESR and ERGEG also call for legally binding disclosure obligations in energy sector regulation including sanction mechanisms. The regulators drafted their advice following a mandate from the Commission in the context of the Third Energy Package. Comments are due by 29 August 2008.