International Conference Mars 2004

in cooperation with

International Conference

The EU Investment Services Directive (ISD) and Energy Trading
– threatening the existence of European energy markets or the beginning of a new era? –

15.-16. April 2004
Berlin-Mitte
Französischer Dom (Friedrichstadtkirche), Gendarmenmarkt 5, 10117 Berlin
Underground station „Französische Straße“ (U6) or „Stadtmitte“ (U2, U6)
Railway station „Friedrichstraße“
Hotels near the venue

Background

Until now energy trading on most liberalised energy markets has been regulated either by public regulation authorities/supervisory authorities or by the organised markets themselves. The new EU Investment Services Directive (ISD) which is supposed to be adopted at the beginning of 2005 marks the first attempt to create a common European legal framework for the execution of commercial agreements and trade orders by providers of financial services, stock exchanges and other alternative trading systems.

„The absence of a single market framework for this business is anachronistic, particularly when one considers parallel steps taken to liberalise underlying commodity and energy markets. This will allow disciplines for preventing market abuse and maintaining orderly markets to be placed on a common EU-wide footing.“ (Commission document Com(2002) 625)

Commodity derivatives will be subject to this new supervision „as long as they are comparable to traditional financial instruments under supervisory aspects.“ Thus electric power, gas, oil and heat derivatives will fall under the application of the directive. Whether physical spot products which are traded on energy markets will also be affected, has not been decided. However this has already been demanded by several
governments of the EU member states.

The directive will have a profound effect on the European financial services market, especially on the energy wholesale market. It is certain that all actors on the energy market will be affected despite the existence of some exemption rules. One positive effect for the concerned companies will be the use of a previously attained licence („European passport“) in all other European member states, something which has not been possible in the past. In contrast to this companies will also face considerable challenges. Advisory activities will be treated as financial services due to the „mounting dependence of investors on personal recommendations“ which in turn will significantly hinder trade on the energy markets.

The application of the Capital Adequacy Directive (CAD) and of the Directive regarding the activities of credit institutions without making the necessary distinctions could have serious consequences. The criteria laid down in these directives concerning the companies equity capital were originally designed for the financial sector. They do not take into account the special circumstances of energy trading. Consequently all national understandings and applications of these directives which pay regard to the special situation of the energy industry would be endangered. The use of energy derivatives as a mean of risk management, which is vital for developing a European single electricity market, will therefore be seriously constrained. Although the directive allows certain exemptions concerning the companies private equity, the question is whether companies trading energy will be able to invoke them.

Conference aims and objectives

The conference will address the following issues:

What is the content of the EU Investment Services Directive?
What implementation schedule is planned?
What are the license requirements for trading energy in the European member states?
What consequences will ISD have on market players/participants in the European member states?
What consequences can be expected for the energy market as a whole?
What kind of special demands does the energy industry place on the supervisory authorities?
What special demands do energy brokers place on the supervisory authorities?

The conference is internationally orientated and will be held in English (German translation provided for some sessions). It wants to build a bridge between European politics and commercial (trading) practices and addresses European supervisory authorities for financial markets and stock exchanges, ministries, political representatives, stock exchange operators, traders and brokers in energy wholesale as well as energy providers.

Our distinguished speakers

Program Thursday 15 April 2004

10.00 Uhr Opening of the Conference and Welcoming of the participants and speakers by the Chairman Dr. Michael Kraus, acting professorship of energy economics, Darmstadt University of Applied Sciences

Welcome adresses by Dr. Werner Langen, MdEP, former minister of state. and Prof. Dr. Georg Erdmann, President of the Gesellschaft für Energiewissenschaft und Energiepolitik (GEE) e.V.

Introductory Presentations

10.30 Uhr Structure and Development of Europe’s Energy Wholesale Market Dr. Michael Kraus, acting professorship of energy economics, Darmstadt University of Applied Sciences

11.00 Uhr Content and Implementation Schedule of the EU Investment Services Directive Dr. Ines Zenke, lawyer and partner with Becker Büttner Held, Berlin

11.30 Uhr Coffee break

Supervision and Practice in Germany, Switzerland and Austria

11.45 Uhr The License Requirement in for Energy Trading in Germany – Present and in Future Dr. Rainer Wiegelmann, BAFin, Bonn

12.15 Uhr Statements by Exchanges and Panel Discussion with Market Players Dr. Hans-Bernd Menzel (EEX), Dr. Jörg Spicker (ATEL), Dr. Ralf Schäfer (RWE), Dr. Günther Rabensteiner (APT), Dr Michael Redanz (Essent Deutschland), Dr. Torsten Amelung (Statkraft), Hermann Schmeink (KOM-STROM) Moderator (in German): Dr. Jacques Piasko (EGL)

13.15 Uhr Lunch

Supervision and Practice in Scandinavia

14.30 Uhr Regulation and Supervision of Energy Commodity Trading in Scandinavia Knut Godager (Kredit Tilsynet - Norwegian Supervision Authority)

15.15 Uhr Statements by Exchanges und Panel Discussion with Market Players Torger Lien (NordPool), Dr. Torsten Amelung (Statkraft), Edward Murray (Vattenfall), Markedskraft* Moderator: Harald von Heyden (EGL Nordic AS)

16.15Uhr End of the first conference day

20.00 Uhr Dinner in the historic Berlin restaurant „Die Möwe“ with performance by the artist Raiko Thal

Program Friday 16 April 2004

9.30 Uhr Welcome by Chairwoman Dr. Ines Zenke, lawyer and partner with Becker Büttner Held, Berlin

Supervision and Practice in UK and the Netherlands

9.40 Uhr Regulation and Supervision of Energy Commodity Trading in the United Kingdom Ted Morris, FSA - Financial Services Authority, London

Regulation and Supervision of Energy Commodity Trading in the Netherlands Theodor Kockelkoren, NAFM – Niederländische Finanzaufsichtsbehörde, Amsterdam

10.20 Uhr Statements von Börsen und Podiumsdiskussion mit den Marktteilnehmern Marc Leppard (IPE), Bert den Ouden (APX), John K. Wright (GFI), John Evans (Spectron), Fiona Smith (Morgan Stanley), Judith de Boeye (ESSENT), Martin Thomas (EnMO) Moderator: Anthony Belchambers (FOA)

11.15 Uhr Coffee break

Supervision and Practice in France and Southern Europe

11.45 Uhr Regulation and Supervision of Energy Commodity Trading in France Franck Saudo, Direction du Trésor (French Ministry for Economics, Finance and Industrie)

12.15 Uhr Statements by Exchanges and Panel Discussion with Market Players Jean-François Conil-Lacoste (Powernext), Maria Luisa Huidobro (OMEL), Pierre Bonnard (RTE), Dr Juan José Alba Rios (Endesa), EDF* Moderator: Arnaud Barbet-Massin (CLC Bourse Crédit Lyonnais)

Concluding Round Table

13.15 Uhr Necessity for Implementing ISD and related questions Dr. Juan José Alba Rios (EFET), Franck Saudo (France), Dr. Michael Kraus, Dr. Ines Zenke, Moderator: Anthony Belchambers (FOA)

13.45 Uhr End of Conference

*invited