ICE Announces Plans to Implement EU Market Correction Mechanism and Related Price Cap on TTF Natural Gas

AMSTERDAM & LONDON–(BUSINESS WIRE)–Intercontinental Exchange, Inc. (NYSE: ICE), a number one international supplier of information, expertise, and market infrastructure, right this moment introduced the way it intends to implement the European Union’s Market Correction Mechanism Regulation (MCM Regulation) and associated worth cap on TTF pure fuel derivatives, in time for entry into pressure of the regulation.

ICE Endex, based mostly within the Netherlands and operator of the world’s most liquid buying and selling venue for TTF pure fuel futures and choices, plans to change its Rulebook to promote compliance with the MCM Regulation, efficient February 15, 2023, topic to completion of related regulatory processes.

Once the MCM Regulation enters into pressure, the Rules of ICE Endex will forbid market individuals from submitting orders to the alternate order guide in TTF derivatives above the worth cap when the correction mechanism is activated, except purchasers are eligible to make use of the exemptions granted within the Regulation. For particulars on the supposed Rulebook adjustments and associated steering in respect of the MCM Regulation, please see https://www.theice.com/endex/circulars.

At the tip of every buying and selling day, ICE Endex determines and publishes settlement costs for all contracts listed on the alternate. The current methodology and strategy used to decide and publish these costs will stay unchanged to be certain that settlement costs proceed to replicate truthful market worth of TTF futures and possibility contracts. This could imply that settlement costs of TTF futures and choices could deviate from the worth cap when it isn’t reflecting truthful market worth.

Meanwhile, ICE’s in depth engagement with prospects confirms that they require continued entry to a market which helps them of their want to handle danger, seamlessly hedge, and entry and take part within the worth discovery course of, whatever the stage of the pure fuel worth. Therefore, ICE is getting ready to launch a parallel marketplace for TTF futures and choices contracts on its London-based alternate ICE Futures Europe from February 20, 2023, topic to completion of related regulatory processes. This will present market individuals with optionality within the occasion the pure fuel worth rises, and the danger of the MCM worth cap being triggered will increase.

“ICE’s objective is to create markets to enable our prospects to handle their danger and we’ve an obligation to our prospects to present options to the issues they face,” mentioned Trabue Bland, SVP, Futures Exchanges at ICE. “We plan to implement the MCM on TTF contracts traded from ICE Endex in a way that may protect the market construction as greatest as attainable. Simultaneously, we’re getting ready an alternate venue in London to act as an insurance coverage possibility for patrons if the MCM prevents them from buying and selling and adequately managing their danger publicity.”

TTF futures contracts on ICE Futures Europe will mirror these on ICE Endex however won’t be topic to the MCM Regulation and associated TTF worth cap. They will likely be bodily delivered, whereby contracts held to expiry will outcome within the supply of pure fuel on the Dutch Title Transfer Facility (TTF) Virtual Trading Point.

ICE Futures Europe is already house to lots of ICE’s pure fuel markets. This consists of the profitable TTF 1st line contract which performs an integral position in pricing and danger administration of world pure fuel portfolios; ICE’s UK fuel benchmark NBP; ICE JKM LNG (Platts), the benchmark worth for pure fuel for North-East Asia; the newly listed LNG futures for North-West Europe and South-West Europe, and the German THE, French PEG, and Italian PSV Natural Gas 1st line contracts.

About Intercontinental Exchange

Intercontinental Exchange, Inc. (NYSE: ICE) is a Fortune 500 firm that designs, builds and operates digital networks to join individuals to alternative. We present monetary expertise and information companies throughout main asset courses that provide our prospects entry to mission-critical workflow instruments that enhance transparency and operational efficiencies. We function exchanges, together with the New York Stock Exchange, and clearing houses that assist individuals make investments, increase capital and handle danger throughout a number of asset courses. Our complete mounted earnings data services and execution capabilities present data, analytics and platforms that assist our prospects capitalize on alternatives and function extra effectively. At ICE Mortgage Technology, we’re remodeling and digitizing the U.S. residential mortgage course of, from client engagement by way of mortgage registration. Together, we rework, streamline and automate industries to join our prospects to alternative.

Trademarks of ICE and/or its associates embody Intercontinental Exchange, ICE, ICE block design, NYSE and New York Stock Exchange. Information concerning further emblems and mental property rights of Intercontinental Exchange, Inc. and/or its associates is situated here. Key Information Documents for sure merchandise coated by the EU Packaged Retail and Insurance-based Investment Products Regulation could be accessed on the related alternate web site below the heading “Key Information Documents (KIDS).”

Safe Harbor Statement below the Private Securities Litigation Reform Act of 1995 — Statements on this press launch concerning ICE’s enterprise that aren’t historic information are “forward-looking statements” that contain dangers and uncertainties. For a dialogue of further dangers and uncertainties, which may trigger precise outcomes to differ from these contained within the forward-looking statements, see ICE’s Securities and Exchange Commission (SEC) filings, together with, however not restricted to, the danger elements in ICE’s Annual Report on Form 10-Ok for the yr ended December 31, 2021, as filed with the SEC on February 3, 2022.

Category: EXCHANGES

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Source: Intercontinental Exchange