BRM service

 

BRM service

Benefits of  KELER CCP BRM services

  • Standardized products
  • Guarantee undertaking
  • Elimination of partner risk
  • Increased market liquidity
  • Possibility to reassure a position
  • Real-time matching of orders and trade confirmation
  • Novation of trade as a central counterparty functionality
  • Anonymous trading and Non-discriminatory participation
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Attachments

Products and Principles
Download (64 KB)

2018 updated BRM Trading Calendar
Download (84 KB)

2018 BRM KELER CCP trading calendar
Download (84 KB)

2017 BRM KELER CCP trading calendar
Download (71 KB)

2017 01 BRM's natural gas forward market service design updated
Download (686 KB)

BRM Gas Market clearing membership agreement
Download (710 KB)

KELER CCP BRM introduction onboarding process
Download (558 KB)

BRM Clearing Membership Package.zip
Download (2065 KB)

Fee Schedule of KELER CCP Ltd.

Approved by the Board of Directors of KELER CCP and the Central Bank of Hungary

Approved by the Board of Directors: Order 7/2017/5., on 8 November 2017

Modified: Order 2017.12.04./2. on 4 December 2017

Approved by the Central Bank of Hungary: Order H-EN-III-8/2018. on 15 January 2018

Effective from: 1 February 2018
Download (730 KB)


General Business Rules of KELER CCP Ltd.

Approved by the Board of Directors of KELER CCP and the Central Bank of Hungary

Approved by the Board of Directors: Order 7/2017/4., on 8 November 2017

Modified: Order 2017.12.04./1.  on 4 December 2017

Approved by the Central Bank of Hungary: Order H-EN-III-9/2018., on 15 January 2018

Effective from: 1 February 2018
Download (1658 KB)

BRM’S DEAL - NATURAL GAS FORWARD MARKET SERVICE DESIGN

BRM and KELER CCP’s co-operation started by signing an agreement on the 13th of September, 2016 after two years of preparation. KELER CCP and BRM declared, they will launch central clearing services for clients trading on the BRM’s natural gas forward market.
Currently market participants in Romania have no risk-management solutions for exchange-based natural gas and power trading. There was a need for instruments to minimize risk and provide for post-trading environment. This move also brings an advantage for BRM as the first energy platform offering central clearing services as well.
Romanian market participants will have access to the most advanced clearing and risk management services in Europe. KELER CCP is one of the fastest growing central counterparties in the EU. Services will be based on extensive know-how of European best practices and fully adapted to Romanian market needs. BRM’s market may become the leading platform and their published settlement price serves as a reference price.
Non-discriminatory and anonym trading, standardized products and procedures, guarantee undertaking of the financial settlement.
As soon as all the licencing procedures (approval of the European authority is required for KELER CCP due to the cross-border service provision), IT developments will be finalized and client on-boarding is successfully completed. This shall happen in the mid of 2017 according to the plans.
By creating the trading calendar KELER CCP and BRM needed to take into consideration the national holidays (when trading is closed) in both countries. There are a very few mismatches in 2017, when only one of the partners will be open for business. On these days the market is closed for trading.
Continuous trading will start at 9:00 AM CET, meaning 10:00 AM Bucharest time. Every trading day and will close at 2:00 PM, meaning 3:00 PM Bucharest time, the time difference doesn’t mean disadvantage in any of the countries.
At the beginning, proprietary trading will be available, but we are already planning to develop the market and stretch our services further. With regards to the tradable products, we are planning weekly, monthly, quarterly and yearly products available as set in the Market Rules of BRM.
The process itself is based on KELER CCP’s more then two decades of experience. In a nutshell: KELER CCP receives the matched trades in real-time and in batch form at the end of the day from BRM. At the time of receiving the trades, KELER CCP confirms their validity. At the time of confirmation KELER CCP as a central counterparty becomes the seller of the buyers and the buyer of the sellers on the market (this process is called novation), so the trading members doesn’t have to worry about each others credibility, central counterparty takes off the burden from their shoulders. The process of clearing can be defined as position management beside calculation of the respective financial positions and the related collateral requirements. Positions of the clearing members are calculated each day on their trading activity. Position management will be done on a gross basis, meaning that sell and trade buyers are registered as well.
In order to take part in the clearing solution, the partners must become Clearing Members. For this, according to the industry standards the following requirements have to be met:
  • RON 1 100 000 shareholders equity
  • licence from the relevant authority for gas trading activity
  • completion of the Know Your Customer Questionnaire
  • provide a basic financial collateral and default fund contribution
Different type of collaterals ensures the safety of the trade. The calculation of the initial margin, variation margin, delivery margin is based on a transparent mathematical method according to European standards.
BCR as the nominated settlement bank will be responsible for the execution of financial transactions based on the instructions of KELER CCP. (Financial settlement will be done in RON.)
The physical delivery is conducted by TRANSGAZ, the Romanian gas transmission system operator of the high-pressured gas pipelines
KELER CCP has a well developed, reliable default management process, which proved to be effective throughout it’s two decades of business experience. If the clearing member fails to meet its obligations by the applicable deadline, KELER CCP takes steps without delay to suspend the clearing right (defaulting party closed from trading), and starts to take the available collaterals in order to mitigate financial risk and indemnify the affected parties in line with the default waterfall*.
Upon request KELER CCP will restore the clearing right of the clearing member only after the member met with its obligation.
 
*KELER CCP applies an EMIR compliant guarantee system, and will use its elements in case of a member’s default as follows:
1. collaterals and available balances of the defaulting member
2. default fund contribution of the defaulting member
3. KELER CCP dedicated own resources allocated to BRM default fund
4. default fund contributions of the non-defaulting members
5. remaining other financial resources of KELER CCP
We are planning to stretch our partnership with BRM and TRANSGAZ to different directions, and to be present on the day-ahead market is one of our goals.

KELER – OTHER ACTIVITIES

KELER CCP is the only clearing service provider in the region. Beside central clearing services for the domestic markets, KELER CCP offers general clearing membership services on 8 different energy exchanges under the umbrella of ECC, the Germany energy central counterparty; where we are the 2nd largest clearing partner by means of number of clients. There are clearing members and non-clearing members from more than 20 countries.
Starting in 2014 with EMIR (European Market Infrastructure) reporting, KELER has established an ancillary service line in addition to its core services. KELER as a reporting agent collects and forwards the required details of derivative and energy trades concluded by its clients (market participants) and forwards them to the relevant trade repository or authority. In our proprietary system, ‘Trade Reporting’, we offer a one - stop- shop solution to obligatory reporting matters under EMIR and REMIT (Regulation on wholesale Energy Market Integrity and Transparency), but we are already in preparation for further regulatory reportings, such as MIFID II. LEI-code (Legal Entity Identifier) has been introduced by EMIR as a mandatory element for identification of the parties in the data reporting procedure. KELER has initiated its LEI application service in 2014 offering its existing and potential clients to acquire LEI codes for themselves and on behalf of a third party – their clients – as well
KELER CCP is continuously looking at extending the markets it clears in order to support the organic growth and expansion of our Clients. We aim to expand our influence and market share regionally and becoming a more robust regional service provider.

 

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