Regulatory Alerts2021-12-14
Order on the Setting of Limits for Holding Commodity Derivatives
The Danish Financial Supervisory Authority (Finanstilsynet) issues this order to establish position limits for agricultural and critical commodity derivatives traded on supervised markets. The authority is empowered to set and revise these net position limits in accordance with EU regulations, specifically to support economic recovery following the COVID-19 crisis. The regulation entered into force on January 1, 2022, and repealed the previous 2017 order on commodity derivative holding limits.
Order on the Setting of Limits for Holding Commodity Derivatives 1)
Pursuant to Section 128, Paragraph 1, of the Act on Capital Markets, cf. Act Consolidation No. 2014 of 1 November 2021, as amended by Act No. 2383 of 14 December 2021, it is hereby ordered:
Section 1. This Order applies to agricultural commodity derivatives and critical or significant commodity derivatives traded on marketplaces subject to the supervision of the Danish Financial Supervisory Authority, and through economically equivalent OTC contracts.
Section 2. The Danish Financial Supervisory Authority sets limits on the size of the net position that a person may hold in a commodity derivative covered by Section 1, in accordance with Commission Delegated Regulation (EU) 2017/591 of 1 December 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards regulatory technical standards for the application of position limits on commodity derivatives, and with Directive (EU) 2021/338 of the European Parliament and of the Council of 16 February 2021 amending Directive 2014/65/EU as regards disclosure requirements, product governance and position limits, and with Directives 2013/36/EU and (EU) 2019/878, as regards their application to investment firms, with a view to contributing to the recovery after the COVID-19 crisis.
Paragraph 2. The Danish Financial Supervisory Authority revises the limits when there is a significant change in the available supply, the number of open positions, or another significant change in the market for the commodity derivative in question covered by Section 1.
Paragraph 3. The Danish Financial Supervisory Authority publishes the set limits on its website.
Section 3. This Order enters into force on 1 January 2022.
Paragraph 2. Order No. 1229 of 24 November 2017 on the setting of limits for holding commodity derivatives is repealed.
The Danish Financial Supervisory Authority, 14 December 2021
Jesper Berg / Anne Bruun
- The Order contains provisions implementing parts of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU, OJ 2014, No. L 173, p. 349, and parts of Directive (EU) 2021/338 of the European Parliament and of the Council of 16 February 2021 amending Directive 2014/65/EU as regards disclosure requirements, product governance and position limits, and of Directives 2013/36/EU and (EU) 2019/878, as regards their application to investment firms, with a view to contributing to the recovery after the COVID-19 crisis, OJ 2021, No. L 68, p. 14.
Statutory Order Series A 2021 Published on 16 December 2021 14 December 2021. No. 2425. Ministry of Industry, Business and Financial Affairs, Danish Financial Supervisory Authority, ref. no. 21-013143 CQ002003