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ESMA Q&A 847 — Q&A — Interpretation of emission allowances under C(4) [Answer Published]
Financial servicesLevel 3Q&AMiFID IIAnsweredOfficial source
Interpretation of "emission allowances" under C(4)
Question
Does the financial instruments in Annex I, section C(4) include derivatives on emission allowances not recognized under the EU ETS, thus making these reportable under EMIR?
Specific example: Derivatives on UKAs, recognized under UK ETS.
Answer
Yes. The definition of derivatives on emission allowances provided in Section C(4) of Annex I to MiFID II does not distinguish between emission allowances recognised for compliance under the EU ETS Directive, and other emission allowances. Therefore, derivatives on emission allowances not recognised for compliance under that Directive qualify as financial instruments.
Source: ESMA original document