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 PRODUCTS & SERVICES Questions & Answers Section 1 - Contract Specifications Q&A - Contract Specifications
What's the connection between ECX and ICE Futures Europe?
What contracts are offered?
ECX EUA Futures Contract was launched 22 April 2005
ECX EUA Options Contract was launched 13 October 2006
ECX CER Futures Contract was launched 14 March 2008
ECX CER Options Contract was launched 16 May 2008
EUA Daily Futures & CER Daily Futures were launched on 13 March 2009
EUAs are EU Allowances in the European Union Emissions Trading Scheme; CERs are Certified Emission Reductions - credits generated by greenhouse gas emissions reduction projects that fall under the Clean Development Mechanism (CDM) of the Kyoto Protocol.
Are ECX contracts based on any of the industry standard Master Agreements (ISDA, IETA or EFET)? ECX Futures and Options Contracts are set out in Contract Rules and Administrative Procedures within the Regulations of ICE Futures. ICE Futures Europe Regulations cover most of the same issues addressed in the ISDA, IETA and EFET Master Agreements, but are tailored to reflect the specific needs of the ICE Futures contract, such as ICE Futures Europe' s delivery mechanism. How do ECX/ ICE Futures deliver the EUAs / CERs? In simple terms, delivery under ICE Futures rules occurs by the transfer of EUAs or CERs from the seller's account to an ICE Clear Europe account held in one of the National Registries and then on to the buying party.
For CERs, the Person Holding Account held by the Clearing House is in the UK Registry. This includes provision for the Exchange to notify the market, from time to time of the Registries from which the Seller's Clearing Member may make delivery and to which the Clearing House may make delivery. Therefore, on the basis that both the UK Registry and the Registry of another Member State have met the Eligibility Criteria, the Exchange would allow delivery from/to that Registry. ICE Futures Europe Clearing Members who are active in the delivery of CER Futures will be required to open a Person Holding Account in the UK Registry or a Registry notified to the market by the Exchange which has met the Eligibility Criteria. This will be subject to legal advice and on the basis that the Registries have met the definition of Registry.
What are the trading hours?
What are the holiday market closure dates?
How is the settlement price calculated? Settlement Procedure for ICE ECX CFI Futures The Unofficial Closing Prices are determined from trades made during the closing period which is a period of time specified by the Directors from time to time. The closing period is 16:50:00 – 16:59:59 hours (UK local time). The Unofficial Closing Price shall be: (i) Where the total number of lots traded during the closing period is equal to or exceeds 100 lots (or a level determined by the Exchange from time to time), the trade weighted average as detailed below in point 1.9.2; (ii) Where the total number of lots traded during the closing period is fewer than 100 lots (or the level determined by the Exchange from time to time), an Unofficial Closing Price will be determined by a designated Market Supervision Official at his discretion as either: (a) A Quoted Settlement Price (‘QSP’) which is an average of quoted prices for specific contract months provided daily by market participants.
(Where the settlement price so established would be below a final valid bid or above a final valid offer equal to or greater in size than the level determined by the Exchange and made in the closing period, the settlement price shall be the final valid bid or offer of such size closest to the QSP.) (b) A price determined by the designated Market Supervision Official taking account of previous business day’s settlement prices, bids and offers, spread values during that ICE Platform trading session, activity in other contracts or groups of contracts, and/or in a related market, and/or other prices that are recorded by the Exchange or any other factors considered relevant.
The trade weighted average is calculated as follows: (a) Multiply the number of lots traded at each price by that price; (b) Add together the resulting aggregate figures; (c) Divide the total from (b) by the total number of lots traded in (a); (d) Where such average is an exact half tick, the price will be rounded up.
An Unofficial Settlement Price may be corrected or amended at the discretion of the designated Market Supervision Official. Fifteen minutes after the display of the Unofficial Settlement Prices for a Contract, or the corrected Unofficial Settlement Prices for a Contract, such prices will be displayed as Official Settlement Prices for such Contract. Prices will be displayed on the ICE Platform. The Official Settlement Prices for a Contract will be communicated to ICE Clear Europe by the Exchange forthwith, and will become the Exchange Settlement Prices for such Contract thirty minutes after the closing period. No amendment to the Official Settlement Price for a Contract may be made without the express approval of the Vice President of Market Operations, or the Vice President of the Compliance Department or their appointed deputies, or other senior Exchange staff. Official Settlement Prices are available from Quote Vendors, displayed on ICE Platform and the Clearing Processing System (CPS) and used by ICE Clear Europe in the calculation of variation margin in the usual way. |
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