Global Markets
Main impacts of MiFID II on your transactions with our Global Market Division in Asia
Depending on the types of trading you conduct in the EU, you may also become directly subject to certain MiFID II obligations: as an example, if you execute and/or clear transactions on listed derivatives on EU exchanges with Societe Generale Group, you may be subject to:
Direct electronic access, HFT and Algorithmic trading
Applicable to DMA/SDMA clients. It provides for extra-obligations on trading venues, DEA providers and DEA clients
Who? DMA and SDMA clients. If you clear with us but maintain your own trading membership to a EU exchange you have separate obligation to comply with MiFID II so you should contact the Exchange to ensure compliance with MiFID II.
What? Various requirements on us (as DEA provider) and potentially on you if you sub-delegate the DMA access or SDMA access to your underlying clients, in terms of enhanced due diligence on DEA clients (on-boarding and annual review), pre-trade controls, procedures and arrangements to ensure resilience and capacity (testing, monitoring, controls). For clients using algorithmic trading, requirement to certify their algo, and to identify the algo by a specific ID, and to assign a trader ID + for HFAT clients, additional requirement on record-keeping, and on timestamps (micro-second granularity level).
How? In order for us to comply with this obligation we need to obtain information set out in the DEA questionnaire
Indirect clearing
Extension to indirect clients of the protection offered to direct clients and restrictions on the number of entities between the CCP and the end clearing client
What? Prohibition of “long clearing chains” + enhanced disclosure requirements on the level of protection offered to the client on its assets, and requirement to offer additional protection to indirect clients on their assets (NOSA/GOSA)
Which trades? All listed derivatives executed on EEA exchanges.
Who? All clients regardless of their location
How? In order for us to comply with this obligation we need to obtain information set out in the IC questionnaire
Commodity position reporting
Obligation on IFs to report, on a daily basis, their positions and those of their clients on listed commodity derivatives, emission allowances (incl. derivatives traded on TV) and EEOTC transactions
What? Reporting, with a distinction between first tenor and following tenors. Requirement to tag each trade as “hedge” or “speculative”
Scope? All listed commodity derivatives executed on EEA exchanges.
Where? Reporting to the TV for listed derivatives and to the NCA for EEOTC (At this stage, no EEOTC has been identified).
How? Reporting to the trading venue (via an ARM) (in order for us to comply with this obligation we need to obtain information set out in the Commodity position limit form)
Commodity position limits
Obligation to comply with commodity position limits set for each relevant listed commodity derivative, as published by the relevant national regulator
What? Commodity position limits, calculated at both entity and group level, based on deliverable supply (spot month) and open interest (all other months), and requirement to file an exemption for hedging in case of anticipated excess of limit linked to non-speculative trading.
View some of the limits published in the UK by FCA on some contracts
Scope? All listed commodity derivatives executed on EEA exchanges.
Who? All clients regardless of their location
How? Position limits are handled directly by regulators and not the exchanges (in order for us to comply with this obligation we need to obtain information set out in the Commodity position limit form)