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The wholesale electricity and gas markets must be transparent and competitive

07/ 04/ 2021
  To combat the abuse in energy trade or market manipulation, the provisions on integrity and transparency of the wholesale electricity and gas markets (REMIT) are enshrined in Regulation No 1227 of the European Parliament and of the Council. Ukrainian lawmakers want to implement a similar regulation by proposing several draft laws on this issue. However, it will depend on the correct implementation of REMITs provisions whether the wholesale electricity and gas markets can be more transparent. The implementation of these provisions requires special attention, as, among other things, they provide for granting additional powers to the Regulator, introducing new rules for market monitoring, prohibiting market manipulation, and the use of insider information. So far, three draft laws have been registered in this regard. According to the European Business Association, draft law №4503 should be taken as a basis for work, as one that best complies with the EU REMIT Regulation. Following the REMIT provisions and the draft law itself, the ban on the use of insider information applies only to persons listed in the draft law (Part 2 of Article 11 of the Law On Electricity Market and Part 2 of Article 57 of the Law On Natural Gas Market). In this case, it is provided that if the person specified in this part is a legal entity then a natural person who participates in decision-making on behalf of such legal entity shall be considered as that person who has insider information”, namely the head of the legal entity. Besides, there are sanctions for the use of insider information. Meanwhile, the business community has some comments on the draft law. Therefore, to properly implement the REMIT provisions and ensure a high level of competition in the electricity and gas markets, businesses propose to take draft law №4503 as a basis. Thus, the community is currently preparing some proposals for the document. At the same time, a meeting will be held shortly with the initiator of the draft law, Lyudmila Buimister, Chair of the Subcommittee on Development of Competition and Equal Conditions for Business of the VRU Committee on Economic Development to discuss the document and proposals from the business. We do hope for a constructive dialogue on this issue.   Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.    

To combat the abuse in energy trade or market manipulation, the provisions on integrity and transparency of the wholesale electricity and gas markets (REMIT) are enshrined in Regulation No 1227 of the European Parliament and of the Council.

Ukrainian lawmakers want to implement a similar regulation by proposing several draft laws on this issue. However, it will depend on the correct implementation of REMIT’s provisions whether the wholesale electricity and gas markets can be more transparent.

The implementation of these provisions requires special attention, as, among other things, they provide for granting additional powers to the Regulator, introducing new rules for market monitoring, prohibiting market manipulation, and the use of insider information.

So far, three draft laws have been registered in this regard. According to the European Business Association, draft law №4503 should be taken as a basis for work, as one that best complies with the EU REMIT Regulation.

Following the REMIT provisions and the draft law itself, the ban on the use of insider information applies only to persons listed in the draft law (Part 2 of Article 11 of the Law “On Electricity Market” and Part 2 of Article 57 of the Law “On Natural Gas Market”). In this case, it is provided that “if the person specified in this part is a legal entity then a natural person who participates in decision-making on behalf of such legal entity shall be considered as that person who has insider information”, namely the head of the legal entity. Besides, there are sanctions for the use of insider information. Meanwhile, the business community has some comments on the draft law.

Therefore, to properly implement the REMIT provisions and ensure a high level of competition in the electricity and gas markets, businesses propose to take draft law №4503 as a basis. Thus, the community is currently preparing some proposals for the document. At the same time, a meeting will be held shortly with the initiator of the draft law, Lyudmila Buimister, Chair of the Subcommittee on Development of Competition and Equal Conditions for Business of the VRU Committee on Economic Development to discuss the document and proposals from the business. We do hope for a constructive dialogue on this issue.

 

Be the first to learn about the latest EBA news with our Telegram-channel EBAUkraine.

 

 

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