Romania's energy market watchdog ANRE concluded that three local energy traders breached the integrity and transparency of the wholesale energy market and fined them with a total sum of RON 18 million (EUR 3.6 million) for market manipulation – specifically for pre-arranged cross sales (wash sales).

The three companies were investigated as a result of suspicions of manipulation or attempted manipulation of the wholesale electricity market, following transactions carried out in the Centralized Market, with continuous double negotiation of bilateral electricity contracts (PC-OTC), Economica.net reported.

All three companies were found to have breached the regulations as a result of pre-arranged deals among them.

The companies were involved in market manipulation practices wholesale of electricity, ANRE concluded, adding that the transactions carried out are included in the subcategory of pre-arranged washing sales - "pre-arranged trading," thus violating the provisions of art. 5 of Regulation (EU) 1227/2011 on wholesale energy market integrity and transparency (REMIT), regarding the prohibition of market manipulation or attempted market manipulation on wholesale energy markets.

Pre-arranged trades are buy and sell orders for substantially the same volume and price and are undertaken or given by different parties acting in collaboration.

A wash sale is a transaction where the buyer and the seller are one and the same person, i.e., where the purchase or sale of any securities does not involve a change in the beneficial ownership of those securities.

iulian@romania-insider.com

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