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Dealing on own account: Difference between revisions
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There are three alternative ancillary activity tests. Under the “'''[[de minimis threshold test]]'''”, a person’s activity is ancillary to its main business if its ''net outstanding notional exposure'' in cash settled commodity products traded in the EU, excluding those traded on a venue, is less than EUR 3 billion annually. The other two tests are a bit more speculative and fiddly to calculate, but for a repackaging SPV, the first one gives plenty of room to work with. | There are three alternative ancillary activity tests. Under the “'''[[de minimis threshold test]]'''”, a person’s activity is ancillary to its main business if its ''net outstanding notional exposure'' in cash settled commodity products traded in the EU, excluding those traded on a venue, is less than EUR 3 billion annually. The other two tests are a bit more speculative and fiddly to calculate, but for a repackaging SPV, the first one gives plenty of room to work with. | ||
“Excluding those traded on a venue?” We suppose this exclusion is predicated on there being someone else involved in an on-venue trade who has the appropriate permissioning, so these naturally should not count | “Excluding those traded on a venue?” We suppose this exclusion is predicated on there being someone else involved in an on-venue trade who has the appropriate permissioning, so these naturally should not count towards your limit — though query whether they should count towards offsetting exposures you might have in other markets. | ||
The annual threshold should be calculated against an average over three-years on a rolling basis. | The annual threshold should be calculated against an average over three-years on a rolling basis. | ||