EXCHANGE NEWSWIRE, 14 October 2011

DB1-NYX merger: EU officials voiced worries in the Statement of Objections about the dominant position in the derivatives industry the combined entity would have, want DB1 and NYX to open up their clearing operations to third parties, and want the exchange groups to agree to a more liberal selling of index licenses to third parties, according to the WSJ.

DB1-NYX merger: NYX may request an oral EU hearing in late October in order to defend the DB1-NYX deal, according to NYX CEO Duncan Niederauer, as quoted in Bloomberg Businessweek. Niederauer also said that NYX is “very close to making some key decisions” on the integration and is ahead of schedule.

ICE proposed a New York floor-access fee of $3,000 for its individual members in 1H12, as “over the past several years, the trading-floor population has declined significantly with the growth of electronic trading.” ICE also proposed rebates linked to trading volume for as much as the full access fee, which it considers “appropriate to the needs of the exchange and is not unreasonable from the perspective of floor-based locals and brokers.”

Direct Edge has been sanctioned by SEC for having “weak internal controls”, according to the Financial Times. Regulators charged that in November 2010 the company helped exchange members fix erroneous trades driven by its "untested computer code," breaking transaction rules and Direct Edge's own guidelines as an exchange, according to regulators.

Direct Edge issued a statement in response to the SEC censure in conjunction with the settlement of the administrative proceeding to resolve the issues, saying that it "understands and embraces the responsibilities that come with being a registered national securities exchange. Several months ago, we developed a comprehensive plan to ensure the fulfillment of our obligations . . . with significant investments made to enhance our technology, personnel and processes.”

CFTC Chairman Gary Gensler advocated that European regulators expand the scope of the European Market Infrastructure Regulation (EMIR) to include all derivatives instead of just OTC contracts only, as quoted in Risk.Net. Gensler stressed the importance that “swaps traded on regulated exchanges are also subject to the clearing requirement to bring the benefits of clearing to swaps, regardless of whether they are traded on-exchange of off-exchange.”

Provided By: Equity Research Desk, www.erdesk.com